The reality, as we all know, is very different. But what would you say is the primary cause of EV (and non-EV) sticker prices rising. Is it the tech?

These informal, unscripted vlog-style videos are a chance for the team to ask the audience their opinions on topics in the world of cleaner, greener, safer, smarter and more equitable transportation and energy – and are filmed without a teleprompter in a single take.

Presenter: Nikki Gordon-Bloomfield Camera, Edit & Color: Vi Horton Art & Animation: Erin Carlie Producer: Nikki Gordon-Bloomfield

Read the transcript here:

Hey everybody, happy Sunday. I hope that whatever you are and whatever you are doing, you are safe, you are well, and you are with someone you care about who also cares about you.

We’ve had a lot of rain this week in the garden, but that’s not the topic of today’s Sunday musings. So go and watch the chicken and garden update if you are so inclined. There’s also the mystery of who’s been eating all of my chicken feed—which is not really a mystery, to be honest.

Anyway, today we are back from our Thanksgiving break. I hope that if you were celebrating and had some time off, it was an enjoyable break. I can’t believe that we’re already back at work. But I don’t have to worry too much because in two or three weeks, we’re going to have another break for the Christmas and New Year period. We all need it—we really all need it.

Anyway, today I want to talk to you about what is driving up the cost of new vehicles. Like it or loathe it, the President of the United States held an event this week in which he announced that the U.S. government is going to roll back the corporate average fuel economy standards for light-duty vehicles. That includes cars and the majority of pickup trucks that private citizens drive around.

His reasons for doing so include that he doesn’t like his predecessor, Joe Biden, very much, that he believes electric vehicles are not all that great, and that fuel economy standards are driving up the costs of new vehicles. I want to ask you all what you believe the real reason is for rising prices of vehicles around the world. It’s not just a U.S. problem.

Obviously, in the U.S., it’s fairly obvious what’s been driving the price rises. Some of it is down to tariffs on imported components and steel, and trade policies that the U.S. currently has, some of which were enacted by the current president. But there are also other forces at work. I think some of it is—yes, a lot of EVs on the market today are still quite expensive because automakers have chased range per charge as opposed to efficiency.

If you look back in history, the BMW i3 was such a revolutionary vehicle at the time, and still is today. When BMW engineered that vehicle, it said, “Okay, we’re not going to just whack a really big battery pack inside this vehicle. We’re going to work on advanced composite materials, advanced drivetrain research, and produce a vehicle that not only has a decent range but has a decent range on a remarkably small, comparatively small battery pack compared to some of its rivals.”

I don’t think any other automaker really to date has picked that mantle up. Obviously, the Tesla Roadster, if it makes it to market, will hopefully blow the competition out of the water with its range per charge and its aerodynamic shape. But mainstream automakers really haven’t embraced efficiency in a way that I wish they would have done.

I think one of the reasons why a lot of EVs on the market today, and plug-in hybrids, haven’t really changed their prices all that much in the last decade is primarily because while the cost to produce battery packs and EVs has dropped significantly, the size and the power rating of the battery packs and the motors that we’re putting into these vehicles today have just gone up and up and up. And the vehicles have got larger and larger and larger.

We’ve talked about vehicle size on the channel before, but I think that’s really one of the primary reasons for vehicle prices going up. But I know it’s not just an EV and plug-in hybrid problem—ICE vehicle costs have gone up as well. And at that point, you have to ask: is it really more efficient engines and drivetrains? While automakers are still investing in more efficient ICE drivetrains, a lot of their investment budget these days is shifting toward EVs.

And while they might be producing EVs, they’re still churning out V6s and V8s and other types of gas guzzlers, many of which still have quite noticeably high sticker prices despite having older technology. We can explain some of that away coming from the geopolitical angle—tariffs, etc. But it’s not just U.S. tariffs affecting the price of U.S. vehicles. It affects vehicle prices around the world.

I think it’s also down to the inclusion of advanced technology in the majority of vehicles. As consumers have become more tech-savvy, they expect more in their cars than they used to. I’m not saying you may feel that way, but a lot of consumers do. Automakers are using in-car tech as a way to lure customers in.

Like they might have done in years past if they were smartphone manufacturers. You know, at one point in history, the fact you had a smartphone was enough. But when Apple came out with the iPhone, all other phone manufacturers had to try and ape what Apple was doing in order to stay relevant in the marketplace.

Now EVs are bringing a lot of connected, quite futuristic services to customers. ICE vehicles are now having to copy that, and you’re now seeing connected services become a fairly standard feature across most markets around the world, across most vehicle price points—even if it’s very basic services, like an online mapping system, instead of having your maps on an SD card that you just put into a slot on your dash and then forgot about.

A decade ago, that was the norm, and if you wanted to have a new updated map, you had to pay four, five, six hundred bucks for a new SD card to be mailed out to you. Sometimes it had to be officially coded to only work with your car’s VIN. If you’ve ever owned a Toyota Prius, you’ll know the headache that was its mapping system. That wasn’t all that long ago.

Now it’s all about over-the-air updates. It’s all about software development. It’s all about new features. And for automakers, it’s all about features that they can sell subscription services for, too. At the end of the day, I’m not looking at this from an analytical point of view, but my gut reaction is that connected services are actually costing automakers a lot of money. They’re putting it in these vehicles and passing the cost on to customers.

Not only can they charge customers for access to the service, but they can also increase the sticker price because those vehicles have connected services. They’re not adding the connected services as a complimentary extra and then asking you to pay for a subscription if you desire. They’re rolling the cost of development, and your free trial, into the purchase cost of your vehicle—and that ultimately drives the price of the car up.

I’ve been talking to the team this week, and Vi quite astutely pointed out that automakers have been taking a lot of things out of cars that, a decade or two ago, would have been standard fit features—like spare wheels and jacks. More recently, sometimes even tire mobility kits are now considered optional. Instead of being a standard feature, if you don’t have a spare wheel, they’re now an add-on that you must spec at the time of purchase—or be content buying a fix-a-flat can or your own tire compressor after you’ve purchased the vehicle.

Obviously, we’re seeing that with all kinds of EVs as well. Charge cables, which used to be included as standard, are generally considered an optional extra now—unless you have a really high-end vehicle. Sometimes you might get a low-end emergency charge cable for free, but if you want one that can actually meaningfully charge your vehicle at any speed, you’re going to have to fork out a couple of hundred bucks, maybe even more, to get that at the point of purchase.

So I’m starting to think that laying the blame at the feet of efficient vehicles—whether that be more efficient gasoline or diesel vehicles, or electric vehicles or plug-in hybrids—is incredibly short-sighted, incredibly patently false. I think as a community, we need to be having this discussion and talking to one another, talking to our elected leaders about what’s really going on.

As I said in my analysis piece—though I cannot fully speak today—analyzing the introduction of per-distance-driven taxes on EVs (per mile or per kilometer), the data very clearly shows that EVs are orders of magnitude better for the planet long-term over their life than comparable ICE vehicles. Even if they cost more from a resource point of view to manufacture, as long as you keep them on the road and support them, they are better for the planet. But we’re not allowing ourselves to speak up.

I think about the reality of that. We’re either completely tired of the hogwash we’re seeing from the White House and other leaders around the world, or we’re so busy just surviving that we don’t have the spare cycles to have that conversation with people.

So over your end-of-year break—whether you’re celebrating Christmas, Kwanzaa, Hanukkah or whatever festivals you celebrate—if you’re getting together with people who are skeptical about EVs and the cost of vehicles, maybe have that conversation. Ask them what they feel the real cost drivers are for new cars. Because I don’t think it’s efficient drivetrains and battery packs. I think it’s all of that tech and all of those expected features that automakers are now rolling in and charging us—the end users, the consumers—to have in our vehicles, so that we can then become a revenue stream for those automakers down the road.

Enjoy the rest of your weekend. I hope you have a wonderful, peaceful one. Wow, I said I couldn’t speak today—I am very tired. I have wobbles. It’s the middle of the day, and I have wobbles, which is never a good sign. But transport, after all, take two, is always about me being very honest and open, and I try to be as authentic as possible. It’s not like TED Talks where I stand up in front of a camera with a suit on. This is what you see is what you get.

So yeah, I’m going to go and make a cup of tea now. Have a good week.

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