Automotive executives are less confident in adopting electric vehicles than they were a year ago

A New York City freight station seen in the Yorkville neighborhood of New York City.

Adam Jeffery | CNBC

DETROIT — Global auto executives are less confident about the adoption rate of electric vehicles than they were a year ago amid supply chain problems and growing economic concerns, a survey released Tuesday showed.

Of the more than 900 automotive executives who took part in KPMG’s annual global automotive survey, the international consulting and accounting firm reported that 76% worried that inflation and high interest rates would negatively affect their business next year. In the United States alone, the figure was 84%.

Amid these concerns, KPMG reports that auto executives are less optimistic about fully electric vehicles becoming widespread in the United States and the world by 2030. Estimates of new cars sold as electric vehicles by then globally ranged from 10% to 40% in this survey. year, down from 20% to 70% in the previous year.

For the United States, the median forecast was for electric vehicle sales to be 35% of the new-car market — down from 65% a year earlier and well below the Biden administration’s goal of 50% by 2030 announced late last year.

“There is still a sense of optimism in the long term, however, and more importantly, there is a sense of realism in the near term. You see that realism throughout the survey,” Gary Silberg, global automotive president at KPMG, told CNBC.

The diminishing optimism in electric vehicle adoption comes amid stricter federal vehicle incentive requirements. growing concerns about raw materials for batteries; Vehicle price registration. These concerns are in addition to other supply chain issues and recession concerns.

“You can be optimistic in the long term, but in the near term you have to be very realistic,” said Silberg. “It’s not about rainbows and butterflies and euphoria anymore, it’s game on.”

Tesla vs. Apple?

Executives who participated in the survey expect Tesla To remain a global leader in electric vehicles but with a much narrower lead.

Perhaps most surprisingly, the executives also said they believed in the tech giant an Applewhich has been rumored to be developing a car for years, will be among the market leaders in electric vehicles.

Apple received 133 votes in the survey regarding electric vehicle driving. This is the fourth highest number of votes, behind Tesla (223 votes), Audi (206) and BMW (196). Apple received 91 votes a year ago, although the company has not publicly confirmed its plans to buy a car.

Silberg said the sentiment around Apple is based on its brand, experience with mass production, and Foxconn, which currently makes its own iPhones. The contract manufacturer recently entered the auto industry and is building an electric pickup truck in Ohio, where executives have expressed plans for further growth in the segment.

Among the top 10 brands after Apple are Ford, Honda, BYD, Hyundai-Kia, Mercedes-Benz and Toyota. It was an unexpected omission general motors. None of the automaker’s brands cracked the top 12. That’s even though the automaker is investing billions of dollars in technologies and has a goal of selling EVs exclusively by 2035.

KPMG left the term “leadership” open to interpretation for respondents.

recession fears

KPMG did not use the term recession in its released results, but Silberg said it reflected economic concerns about inflation and higher interest rates.

Those concerns coincide with ongoing supply chain problems for automakers — from raw materials for electric vehicles to semiconductor chips. In a separate study involving semiconductors, automobiles are seen as the most important sector to increase revenue over the next year. This is the first in 18 years of the survey, according to KPMG, which expects automotive semiconductor revenue to exceed $250 billion by 2040.

Despite the concerns, 83% of automotive executives surveyed globally said they were “confident” of higher profits over the next five years – up from 53% in last year’s results.

In the US, 82% of CEOs said they were “confident” of profitable growth in the next five years, compared to 67% in 2021.

KPMG surveyed 915 executives in October. More than 200 participants were CEOs and 209 other C-level executives. More than 300 participants were from North America, including 252 from the United States

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