Battery supplier: cheap gas won’t change long-term outlook for electric cars image

South Korea’s Samsung SDI Co Ltd, a company that has specialized in supplying automakers with batteries for electric cars, believes that today’s slump in worldwide oil prices won’t affect the growth predictions for the sector.

The forecast comes from an executive of the firm that primarily supplies electric vehicle batteries to BMW and is engaged in a worldwide combat for domination of the business with LG Chem, Panasonic and others. “The growth in electric vehicles until 2020 will come in response to various regulations being imposed by key governments in the United States, Europe and China as opposed to economic benefits like oil prices,” commented Samsung SDI Senior Vice President Kim Jeong-wook. Because of range anxiety – the electric cars trail the mileage ratings of gas counterparts – upfront cost of ownership and a lack of widespread charging networks, the adoption of electric cars has not gone as planned – with automakers envisioning just a decade ago the roads filled with such autos.

Additionally, since June last year, the global supply of oil has exceeded demand and because the OPEC decided not to cap production the crude oil continued to drop. That, corroborated with the fact that America has become a leading producer, has led to cheap gas prices across the states, with retail gasoline even going below $2 a gallon. The global auto sales are also increasingly turning away from fuel efficient – and expensive – cars, such as electrics towards the added comfort and productivity of pickup trucks, SUVs and crossovers. On the other hand, countries across the world, including the US, EU and China have started a crusade against pollution, envisioning tougher fuel efficiency regulations.

Via Reuters