The Economist has issued an optimistic forecast but warns of geopolitical consequences in the shift toward battery power.Electric vehicles will reach a "tipping point" next year, finally surpassing internal combustion in value and performance, according to a report issued by The Economist.Many analysts are focusing on battery prices as the most important variable affecting demand for electric vehicles in recent years. Cost per kilowatt-hour has certainly followed a downward trend, allowing Tesla to gradually expand from an exclusive $100,000 electric sports car to a $70,000 luxury sedan and then a $35,000 mass-market car.
Other automakers are following suit, shifting development resources to electric vehicles. There appears to be less certainty over timing, however, and some established automakers remain confident internal combustion powertrains will continue to dominate sales volume for the next decade or longer.
"The rise of electric cars will challenge the world's thirst for oil," The Economist says. "It could spark a global shift of power from countries that have enjoyed the influence that oil has bought."
Notably, the forecast was published weeks before reports of the Trump Administration's plan to eliminate the $7,500 tax credit for EVs sold to Americans.