Do the Latest Sales Figures and Patent Activity Suggest the Electric Vehicle Market Is Stalling?

Sales of low-emission cars recently fell in the UK for the first time in over two years in a development that the Society of Motor Manufactures and Traders called a “grave concern” for the industry.  Meanwhile, Toyota has opened up almost 24,000 of its hard-earned patents related to low-emission vehicles to other car manufacturers in an attempt to accelerate the flagging uptake of its electric vehicle technologies.

Taken at face value, these headlines offer a gloomy forecast for the electric vehicle industry.  But do these industry developments signal that the electric vehicle future is now in doubt, or is this merely a bump in the road for the industry?

First, we must take a closer look at the low-emission vehicle sector itself and the elements that make up this developing industry.  To make for an improved comparison with fossil fuel vehicles, stats for low-emission vehicles bundle together figures for a number of alternative-fuel vehicles, including those for so-called plug-in hybrid electric vehicles (PHEV), which use an internal combustion engine in combination with a battery-powered motor, and full battery-powered electric vehicles (BEV).  If we break down the stats for these two main parts of the industry, and look at some of the contributing factors to the overall fall in sales, the outlook starts to look less bleak for electric vehicles.

Plug-in hybrid vehicles, which rose to success relatively quickly with the likes of the Toyota Prius, show a significant fall in sales in the UK of 50.4%.  This fall can largely be attributed to the scrapping of government subsidies for PHEVs in last year’s Budget.   Meanwhile, despite a reduction in the government subsidy for battery electric vehicles from £4,500 to £3,500, BEVs actually show a strong rise in sales of 61.7%.  As a result of the swing towards battery electric vehicles, for the first time, sales of BEVs have overtaken those of PHEVs in the UK.

This shows that the industry is still weaning itself off a reliance on fossil fuels.  For many years, plug-in hybrids have offered the best of both worlds, providing low emissions and allowing access to green subsidies, while providing the peace of mind that comes with having an internal combustion engine and the ability to stop at a petrol station to cure range anxiety.  However, it seems that hybrid vehicles were always merely a stepping stone for the industry on its way to purely battery-powered electric vehicles, and we may now be reaching the tipping point for BEVs.

Indeed, if we look at Toyota’s move to open up part of their patent portfolio to other manufactures, a similar pattern can be seen.  The 24,000 patents released by Toyota relate mainly to the core technologies used in plug-in hybrid and fuel cell vehicles.  With the success of the Prius, Toyota has invested heavily in plug-in hybrids, a market which now seems to be on the wane.  Meanwhile, Toyota has also been a pioneer of fuel cell vehicles, which aim to do away with the need to plug in at all, instead relying on alternative fuels, such as liquid hydrogen.

The tipping of the balance towards battery-powered electric vehicles threatens to cut straight through the middle of Toyota’s EV expertise, with plug-in hybrids having largely served their purpose of easing the industry towards BEVs, and fuel cell vehicles offering clear advantages over BEVs but without being able to match the real-world practicality of their counterparts.  Toyota’s move, therefore, may be seen as a bid to prolong the relevance of plug-in hybrid vehicles while kick-starting a long-term push towards the goal of making fuel cell vehicles commercially viable on a large scale.  This move can therefore be seen as a response to the rise in success of purely battery-powered vehicles.

So, while at first glance developments in the industry do not paint a picture of a healthy electric vehicle market, the signs are there that we may actually be witnessing the transition from hybrid vehicles to full electric vehicles.  The industry is not without its challenges to face, such as the need for improved infrastructure to cope with vehicles solely reliant on a plug-in charge, but the future seems decidedly brighter than the headlines suggest.

If you are involved in developing electric vehicle technologies, the attorneys in Gill Jennings & Every’s advanced engineering group have a wealth of expertise in the electric vehicle sector and would be happy to help with your IP needs. Please contact us via engineering@gje.com to discuss your IP needs, or find my contact details on my web profile here.