Photo: Gerhard Lipold from Pixabay
Many think forcing electric vehicles down people’s throats is a bad idea. Well, it is, but it’s not how things will go from here. Electric cars will become dominant not because there would be no ICE versions available but because nobody will want to buy a gas-powered vehicle in the future.
Recently, California announced banning all combustion engines starting in 2035, and many in the auto industry freaked out. The truth is that ICE vehicles might disappear long before this deadline. Not because of the ban, but because the market conditions will make people consider switching to more efficient means of transportation.
Already preferences are changing, as reflected by the hefty price increases on the used car market. Whereas gas-powered vehicles only registered a modest price increase, electric vehicles’ prices skyrocketed in the first six months of the year. This shows that many would like to buy an EV, but the offer is limited. Hopefully, this will change as more electric vehicles are launched.
But there’s nothing more convincing to ditch the combustion engine than not finding financing or having to pay an insurance premium in case you drive one. This is the way of the future, and we expect more of the sort in the coming years. It’s already happening in Australia, where a bank announced scrapping loans for new ICE vehicles.
Bank Australia will stop giving loans for new diesel and gasoline cars starting from 2025, says CNBC. According to Sasha Courville, the bank’s chief impact officer, the cut-off date was chosen “because the change to electric vehicles needs to happen quickly.” Even though the bank will not finance the purchase of a new ICE vehicle, it will continue to provide them for used ones. Courville explained the decision by pointing to the undeveloped used EV market.
Just like Americans, Australians are not big fans of electric vehicles and are just warming up to the idea of buying battery-electric cars. If more banks adopt the same strategy as Bank Australia, more people will likely want to buy an EV. Nevertheless, if people would not afford to buy a new EV, they will turn to the used car market for an old gas car. What do you think? Is it a good idea to cut loans for ICE cars?
Already preferences are changing, as reflected by the hefty price increases on the used car market. Whereas gas-powered vehicles only registered a modest price increase, electric vehicles’ prices skyrocketed in the first six months of the year. This shows that many would like to buy an EV, but the offer is limited. Hopefully, this will change as more electric vehicles are launched.
But there’s nothing more convincing to ditch the combustion engine than not finding financing or having to pay an insurance premium in case you drive one. This is the way of the future, and we expect more of the sort in the coming years. It’s already happening in Australia, where a bank announced scrapping loans for new ICE vehicles.
Bank Australia will stop giving loans for new diesel and gasoline cars starting from 2025, says CNBC. According to Sasha Courville, the bank’s chief impact officer, the cut-off date was chosen “because the change to electric vehicles needs to happen quickly.” Even though the bank will not finance the purchase of a new ICE vehicle, it will continue to provide them for used ones. Courville explained the decision by pointing to the undeveloped used EV market.
Just like Americans, Australians are not big fans of electric vehicles and are just warming up to the idea of buying battery-electric cars. If more banks adopt the same strategy as Bank Australia, more people will likely want to buy an EV. Nevertheless, if people would not afford to buy a new EV, they will turn to the used car market for an old gas car. What do you think? Is it a good idea to cut loans for ICE cars?
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