Economy, Auto
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Global Carmakers to Invest $90 Billion in EVs

Nissan’s 7-year-old Leaf is the world’s top-selling electric vehicle.Nissan’s 7-year-old Leaf is the world’s top-selling electric vehicle.

Ford Motor Co’s plan to double its electrified vehicle spending is part of an investment tsunami in batteries and electric cars by global automakers that now totals $90 billion and is still growing, a Reuters analysis shows.

That money is pouring into a tiny sector that amounts to less than 1% of the 90 million vehicles sold each year and where Elon Musk’s Tesla Inc, with sales of only three models totaling just over 100,000 vehicles in 2017, was a dominant player.

With the world’s top automakers poised to introduce dozens of new battery electric and hybrid gasoline-electric models over the next five years - many of them in China - executives continue to ask: Who will buy all those vehicles?

“We are all in,” Ford Motor Executive Chairman Bill Ford said of the company’s $11 billion investment, announced on Sunday at the North American International Auto Show in Detroit. “The only question is, will the customers be there with us?”

“Tesla faces real competition,” said Mike Jackson, chief executive of AutoNation Inc, the largest US auto retailing chain. By 2030, Jackson said he expects electric vehicles could account for 15-20% of new vehicle sales in the United States.

Investments in electrified vehicles announced to date include at least $19 billion by automakers in the United States, $21 billion in China and $52 billion in Germany.

But the US and German auto executives say that the bulk of those investments are earmarked for China, where the government has enacted escalating electric-vehicle quotas starting in 2019.

Mainstream automakers also are reacting in part to pressure from regulators in Europe and California to slash carbon emissions from fossil fuels. They are under pressure as well from Tesla’s success in creating electric sedans and SUVs that inspire would-be owners to flood the company with orders.

Daimler has said it will spend at least $11.7 billion to introduce 10 pure electric and 40 hybrid models, and that it intends to electrify its full range of vehicles, from mini-compact commuters to heavy-duty trucks.

The largest single investment is coming from Volkswagen AG, which plans to spend $40 billion by 2030 to build electrified versions of its 300-plus global models.

In the United States, General Motors Co has outlined plans to introduce 20 new battery and fuel cell electric vehicles by 2023, most of them built on a new dedicated, modular platform that will be introduced in 2021.

Chinese automakers, including local partners of Ford, VW and GM, all have publicized aggressive investment plans.

For now, Nissan Motor Co Ltd’s 7-year-old Leaf remains the world’s top-selling electric vehicle and the company’s sole battery-only car — an offering soon to be swamped by new rivals bringing tougher competition that could add pressure to pricing.

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