Are electric cars an aspirational purchase at last?

It’s a long road ahead, but could new electric vehicles see an end to the internal combustion engine?

It’s a long road ahead, but could new electric vehicles see an end to the internal combustion engine?

It wasn’t long ago that if you mentioned electric vehicles (EVs) you would most likely imagine a golf buggy or a driverless monorail accessing airports or leisure parks. No more. Now we have the £100k+ BMW i8, a “plug-in-hybrid” which can reach 0-62 mph in 4.4 seconds and the equally impressive Tesla Model S with its fully electric kWh all-wheel drive, which can accelerate to 62 mph in 2.7 seconds. They are already becoming the envy of the school pick-up and boasting these amazing performance figures, are exciting even serious petrol heads (who incidentally will need to look for a new collective noun in the future).

These new models are the pinnacle of what is definitely now a seismic and systemic change in the automotive world and reflects changing attitudes. It may even signal the end of the internal combustion engine – but not for some time yet as, pun intended, it is a long road to when that will be completely the case and this article explains a little bit about why that has to be the case.

Growing Demand

The growth in EVs, be it full EVs, plug-in-hybrids or vehicles with electric-powered components is something driven by attitude. That of the public and of the car manufacturers and their dependent supply-chain has definitely and significantly changed and the pace of that change has gathered speed dramatically. The buying public have switched on to Elon Musk’s Tesla vision because he has made it look decidedly sexy, cleaner and safer. It has been helped by favourable tax and company car bias from central government and it is becoming more affordable (relatively – more on this below). Manufacturers have plugged into the electrification revolution because the relative cost of battery packs have fallen significantly; in response to progressive tightening of CO2 emissions regimes globally; because China is driving the market and because they have to remain competitive and avoid losing market share to Chinese manufacturers and last but not least they have seen, through Tesla and other EV sales, that there is definitely a market there.

So, without exception, all of the OEMs have announced model releases or planned EV models amongst their range with the high water mark being Volvo’s announcement that all the model range it launches from 2019 will have an electric engine, placing electrification at the core of its future (although for the foreseeable future those ranges will have plug-in-hybrid versions so petrol and diesel ICE contribution is not completely dead, even in Sweden).

Despite announcements of forthcoming models from the likes of JLR, Aston martin, BMW, Mercedes, VW Audi and the announcement by Tesla that its more affordable Model 3 is now in sale (for which the first 300,000 in the launch have been snapped up despite a requirement to make a £1,000 deposit), things will not change overnight. There are already 2 million EVs on the road globally which represents a 1,500 per cent increase from 2005, yet it is still a relatively small share of total vehicle sales compared to ICE vehicle sales. In Norway, EVs comprise almost a third of all sales, due largely to government subsidies but the UK is more typical with EVs at just over 1 per cent of total sales.

Change is coming

In order for EVs to be the mainstay of a profitable car industry some very basic factors need to change. At the moment there is a trio of inhibitions to a thriving EV industry and a mass adoption by the public. These are the cost, the current lack of range (or “energy density”) and lack of supporting infrastructure. This is even before we get to some real issues around safety and environmental concerns around electrification and the dependency of the rest of the world on China, which has almost all the reserves of lithium under its soil. Looking at each of these in a little more detail.

Stumbling Blocks

The major stumbling block to the conversion to mostly electric powered cars is still the cost of the battery packs. Batteries are almost all lithium ion powered, extremely heavy (currently about a tonne in weight) and very expensive to create and put together. There is a scramble to build a supporting bank of power plants including colossal gigaplants envisioned by Tesla’s billionaire visionary Elon Musk. It is true that battery costs have fallen by as much as 80 per cent since 2010 but the cost of the units still remains a major concern. Typically the battery packs alone can cost around £12,000, which equates to approximately 40 per cent of the cost of a typical entire EV RRP. That explains why most existing and proposed EVs are at the luxury end of the spectrum, where the profits can absorb some of this cost. However, it currently makes the manufacture of mass-market, cheaper cars, uneconomical. Organisations such as McKinsey and Bloomberg separately conclude that it will take a decade for prices to equalise with ICE costs and will require extensive subsidies and research funding to improve the efficiency of the operations. Most economic commentators say that it will be 2025 before EVs are price competitive with ICE vehicles. A real mass market cannot happen until that point. The race to get there does also pose huge issues of profitability and liquidity for the car manufacturers until that tipping point occurs.

Car buyers are also put off by the well to wheel range issues, currently a natural inhibitor, with current lithium ion models typically advertising ranges of between 185 and 250 miles but some only reliable to 100 miles before needing a full recharge. Comparing this to ranges expected from a full tank of fossil fuel is creating “range anxiety” amongst punters and a failure to embrace the technology right now. A race is on, in laboratories and seats of learning, to try and push forward battery technology, in terms of significant increases in range and charging time, whether it be changing the composition of the battery or to move to solid-state battery alternatives to lithium ion. The good news is that the likes of US Department of Energy and their equivalents in China, India and the Eurozone are throwing serious resource at this, as well as getting collaboration from private sector giants such as Samsung, Panasonic, IBM, Tesla and our own Dyson.


Assuming this impressive cohort do make the necessary progress, this is not the end of the story. What we have by way of existing public infrastructure is well documented to be under increasing strain, even now. There is already 6 EVs for every public charging point. Lots of these are at the likes of railway station car parks where there is a growing frustration around access and general hogging of those limited charging bays. The AA publishes helpful information such as the average distance to a charging point is less than 4 miles but if one delves slightly deeper into this stat, these are very much concentrated in the conurbations and in rural areas the distances extend up to nearly 50 miles to a public charger, which creates a need to plan routes carefully.

Plans to expand the range and access to power is a sub-set of the move to full electrification, which can only be achieved by huge public investment. Erik Fairburn, the CEO of PodPoint, estimates that 45 million power points will be needed in the UK to satisfy the all-electric regime required by the government by 2040. The car manufacturers cannot reasonably be expected to self-fund this as the economic model does not stack up. Huge expansion of the power charging plan needs to occur through a combination of urban access to power and the linking of supply to and from power plants, which if the environmental benefits are to be achieved, need to be safe and situated away from urban areas and where possible provided through smart electricity, not powered by coal, oil or gas powered power stations.

Past the point of no return...

It is undoubtedly true that we have passed a point of no return in the road towards an end to the internal (infernal!) combustion engine powered cars on our roads. All manufacturers are fully committed to introducing, developing and in the case of the likes of Volvo, going all-in, in poker parlance, into plug-in vehicles. They are being driven to do so by governments that, USA aside, remain committed to meeting the standards for CO2 emission reductions, set by The Paris Accord. Proposals for car sharing, automated vehicles and the like will help but we are currently only problem shifting, in that while the desire to take ICE vehicles off the roads, reduce greenhouse gases and clean the air in our towns and cities is undeniably binary, we have a real mountain to climb globally to create an environment that can support this and make it the new normal.

Our content explained

Every piece of content we create is correct on the date it’s published but please don’t rely on it as legal advice. If you’d like to speak to us about your own legal requirements, please contact one of our expert lawyers.

Mills & Reeve Sites navigation
A tabbed collection of Mills & Reeve sites.
My Mills & Reeve navigation
Subscribe to, or manage your My Mills & Reeve account.
My M&R


Register for My M&R to stay up-to-date with legal news and events, create brochures and bookmark pages.

Existing clients

Log in to your client extranet for free matter information, know-how and documents.


Mills & Reeve system for employees.