The number of companies that existed to build horse and buggies plummeted at the turn of the 20th century—from 13,800 in 1890 to only 90 in 1920. A century later, as fate would have it, it’s likely we’re entering a similar phase with the combustion engine vehicle.
There’s good reason for that. After decades of dormancy, innovations in electric vehicles have produced a product that is simply better than what’s currently on our roads. And it’s not just that they go 0 to 60 in two seconds. “Beyond that, it runs cheaper and it’s more efficient than internal combustion,” Mike O’Donnell, Magnet’s VP of Operations, told me recently. “It’s better for the environment, less CO2.”
With California’s ban on sales of new gas-powered cars set to begin in 2035—and other states likely to follow suit—manufacturers with a hand in the automotive industry must prepare for disruption. They’ll want to stay educated on a moving-target timeline and be intentional about their path forward. With that in mind, here’s a primer on where things stand and what to expect.
Barriers to EV Adoption
The million-dollar question is how long it will take to reach critical mass, and therefore how urgently manufacturers in the combustion engine space should be planning their exits.
It might be helpful to think of what we’re currently experiencing as akin to a massive chicken and egg problem. We simply don’t have the pieces in place to support wide-scale EV adoption. And without it, some consumers remain leery of going fully electric, while automakers take a deliberate, measured approach to transition. Then again, if consumers were to dive in head-first or automakers were to stop selling combustion engine cars tomorrow, government agencies and utility companies would be forced to act much more quickly.
One chief concern right now is ensuring we have the electrical power to handle heavier EV adoption. Just a few weeks ago, during a prolonged heat wave in Texas that pushed its power grid toward capacity, Tesla drivers received an in-console note asking them to charge only during non-peak hours.
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Our power grids are only equipped for so much usage. That’s why California has had rolling blackouts during the summers, when air conditioners are humming. “To plug in your car in your garage to charge that giant battery in there, we’re going to need more juice, right?” O’Donnell says. “And there’s no more juice.” The precursor to mass EV-adoption, then, will require not only modernizing the aging power grid infrastructure, but adding capacity to the power plants that supply the electricity—through some mix of natural gas, nuclear energy, or renewables like wind and solar. In the U.S., renewables made up 19.8 percent of electricity generation in 2020, a number expected to rise to 35 percent by 2030.
Beyond grid questions, we’ll need to put up a reliable web of openly accessible charging stations—either at gas stations or elsewhere—so that consumers feel comfortable knowing they’ll be able to find a charge no matter where they’re traveling. That, again, will take time.
“I think a lot of people think, well, if we just make a lot of these cars, like, next year, we could have 100% electric cars—probably not,” O’Donnell says. “But it’s going to happen, whether it’s five years or 20 years.”
A quick aside: Recently, electric carmakers have been hit with the sharp increases in prices for materials felt by many along the supply chain, with demand for lithium outpacing supply. While it’s a short-term trend that will cause a few headaches, I find little reason to believe it will impact long-term trends toward EVs. In fact, prices are expected to level out and begin declining by 2026.
The EV movement is well on its way.
How Manufacturers Can Prepare for EVs
With the exact timeline up in the air, the trick for manufacturers who produce internal combustion engines or other parts made for combustion engine vehicles will be to stay educated, stay prepared, and think critically about how they can leverage their skills, knowledge, and resources toward a new path.
To be sure, not every manufacturer in the automotive industry will be upended. Electric vehicles still need steering wheels. They still need dashboards and control panels. They still need a steering rack and seats. But for every job that remains, there will be several more that won’t. Electric vehicles don’t require catalytic converters or exhaust systems or engines or transmissions, billions of dollars in manufacturing that will disappear.
And while there are smart ways that workers in those sectors can transition into new ones, it is extremely important to be clear-eyed about the ways your specific skills and expertise will stack up. “One thing that won’t happen is a company that takes aluminum, melts it, makes it into casting, drills holes in it, machines it, puts pistons in it—they’re not going to make a battery,” O’Donnell says. “With batteries, it’s a chemical process. You have chemicals, you mix them together, you make pastes, make membranes—it’s a whole different process.”
That doesn’t mean there is no future for these manufacturers. “If they invest, they could migrate into something different than engines,” says O’Donnell. “Maybe they get into powerplant design because they know combustion and how flames propagate and those engines. It may not be that they use the same capital equipment, but they can use their technical knowledge and translate that into another industry.”
For as much disruption as a transition to EVs will bring, it also represents incredible opportunity for manufacturers willing to think ahead and invest early.
Injection molders, for instance, should be looking at the thick plastic boxes that form the outside of EV batteries. Those skills translate.
Thick wire already exists inside cars today. Cable makers and connection makers should be talking to the Teslas and GMs of the world to understand the wiring needs of the EV industry, the specific connections those vehicles require.
Batteries will be big business—there’s a reason states are competing to land factories. But there is opportunity throughout the EV ecosystem. The automotive manufacturers that prepare for the inevitable transition to an electric vehicle ecosystem will be the ones who not only survive, but flourish, in a fully electric future.