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The digest includes a general news agenda, expert interviews on the prospects of electric vehicles and battery technology, an analytical overview of the current state and future prospects of the industry in Russia and worldwide, an overview of domestic market players, and a Tesla case study.
One of the most notable and important technological transformations is taking place in the global automotive industry. Electric cars, which only a couple of decades ago looked like fashionable toys, are becoming both an environmentally friendly and economically attractive means of transport.
Recent sanctions and the withdrawal of foreign carmakers from the Russian market present a dilemma for the country: should Russia try to catch up with the rest of the world by establishing full-fledged production of traditional internal combustion engine cars despite their growing lack of relevancy, or should it make the leap and jump on the ‘electric car’ bandwagon?
Understanding how this dilemma is resolved today, evaluating how electric vehicles have already penetrated the economy, and identifying the main vectors of its further development are the main objectives of this issue.
Conclusions and observations:
Electric cars are often seen as a greener technology and a step towards a zero-CO2 economy. This is one side of the coin. The other side is the development of unmanned vehicles, which naturally will be powered by electricity. On top of these two trends is the economics of electric cars, which is becoming increasingly competitive. Along with the development of technology, changes are also occurring in the concept of urban traffic organisation, the approach to the production process, and inter-industry synergy (including through recycling).
Whatever happens, electric vehicles continue to evolve: the growth rate of electric vehicle sales increased both during the COVID-19 pandemic and during the crisis events of 2022. In Russia, sales of new electric cars grew by 34% in the first 10 months of 2022, while overall sales of new passenger cars and light commercial vehicles fell by more than 60%.
Half of car owners in Russia are ready to switch to an electric car. Firstly, because it is environmentally friendly, secondly, because petrol prices are high, and thirdly, because an electric car is more economical to maintain and operate.
According to the Concept for the Development of Electric Vehicles in Russia, one in ten cars made in Russia will be electric by 2030. In eight years’ time, about 220,000 electric cars are planned to be manufactured in Russia every year, and the total number of electric-powered vehicles will exceed 1.4 million. The International Energy Agency (IEA) forecasts that there will be between 200 and 350 million electric cars in the world by that time.
According to the Ministry of Economic Development, Russia will be able to produce its own fully localised electric vehicles if it creates and develops domestic pull production in electrochemistry, electromechanics, and control electronics.
The battery accounts for at least 40% of the cost of an entire electric car. Various options for making electric cars cheaper are being discussed. For instance, batteries could be standardised and reused in stationary energy storage systems. Different financing and ownership schemes are also being considered, including those under which cars are bought without batteries and the latter are supplied through leasing.
Russia is gradually building up its own production of lithium-ion batteries for electric cars, and several lithium deposits are planned for development: rising prices for this metal on the global market make these projects economically feasible and profitable. The US Geological Survey estimates that Russia has 1 million tonnes of lithium reserves.
Eventually, all federal highways in Russia will be equipped with the necessary infrastructure and will be fully open to electric vehicles and drones.
As for the competitiveness and economics of two different technologies—the internal combustion engine and the electric motor—a great number of factors should be considered, emphasises Konstantin Trofimenko, Leading Expert at the Institute for Transport Economics and Transport Policy Studies at HSE University.
‘An electric car may be more expensive to purchase than a car with a traditional internal combustion engine, but it will be cheaper in operation—if only because it breaks down less often as it does not have as many mechanical parts inside. Although, of course, this depends primarily on the car's operating parameters.
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