Myth: It is impossible to convert the entire global road transportation fleet to electric vehicles

 |  6 May 2024

False. The global vehicle fleet turns over roughly every 20 years.

As in other disruptions throughout history, once the new technology becomes economically competitive, it will naturally replace the older technology as market adoption follows an S-curve. Today, electric vehicles (EVs) have reached parity and now represent better value for money than internal combustion engine (ICE) vehicles, which means fleet turnover will naturally result in electrification as well.

Furthermore, the promise of autonomous driving technology will further accelerate the pace of adoption because electric and autonomous technologies are complementary. Vehicle utilization will thus shift substantially away from private ownership toward Transportation-as-a-Service (TaaS) provided via robot taxis, or robotaxis for short.

History also shows that supply chain constraints are only ever temporary for materials that are not fundamentally scarce. Recent supply chain bottlenecks in batteries that were exacerbated during the covid-19 pandemic, for example, have already begun to yield as new investment expands supply to meet demand.

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The disruption of the transportation sector by robotaxis and TaaS is inevitable. In common with other technology-driven disruptions, the shift to TaaS will be non linear and follow an S-curve, where TaaS will become progressively cheaper and improve its functionality, while ICE vehicles will become ever more expensive to operate and harder to use. 

Learn more about the disruption and transformation of the transportation industry.

Published on: 12/07/23

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