The impact of COVID-19 on Electric Vehicles (EV) will differ across regions. We are already seeing post-crisis EV sales rebounding strongly in China. We also expect investments to remain on track in Europe due to continued strong regulatory tailwinds. EV demand might stagnate in the United States, especially if federal regulations about emissions loosen and oil prices remain low at the pump. In India we predict faster electrification across transportation needs given that prices at the pump have been delinked to oil prices and continue to remain high.
As the pandemic continues, need for social distancing will have a significant impact on mobility behavior and preferences. Many people may switch to a transport mode that reduces the risk of infection, but the exact shifts will largely depend on affordability and their pre-COVID habits. People who used a private vehicle may use it even more extensively, while those who previously relied on public transport might switch to alternate modes, such as personal mobility, biking or walking. We refer to this switch to a trade down, where commuters look for safer yet cheaper options in a slowing economy. Evidence from Chinese cities post lockdown confirms that private cars, walking, and biking have gained the most share since the pandemic began, while buses and subway ridership have experienced temporary declines.
But we at AdvantEdge feel that such changes are temporary and that shared-mobility solutions, including all forms of public transit, will rebound and continue to regain lost customers due to the lockdown. Micro-mobility solutions could also pick up more quickly if strict disinfection protocols are installed. That said, the pandemic could produce some permanent shifts over both the short and long term. WFH or remote work could become the norm temporarily, if companies recognize its continued benefits. If more people permanently work from home, the reduction in commutes would likely produce a long-term decrease in total vehicle kms traveled.