Mercedes-Benz and Audi are the latest major manufacturers in the automotive industry that are reversing their goals of exclusively selling electric vehicles between 2025 and 2030.
After a general slowdown in the growth of sales of electric cars, many companies have decided to give up on the idea of exclusively manufacturing and selling this type of car by a specific date.
Mercedes, Audi case and Ford's million-dollar losses
Three years ago, Mercedes announced its plan to fully launch into the electric market by 2023. At the time, the company said it would phase out all gasoline-powered vehicles, but included the caveat that it would take place "when markets allow" (although it set the date for 2030). However, the company reported in its latest earnings statement, from last year, that it only expects 50% of its sales to be all-electric:
Customers and market conditions will set the pace of the transformation (...) The company plans to be in a position to cater to different customer needs, whether it’s an all-electric drivetrain or an electrified combustion engine, until well into the 2030s.
Audi also changed its mind on electric vehicles. The manufacturer announced that it gave up on its goal of manufacturing and selling only electric cars by 2026. Instead, they will continue to make gasoline-powered vehicles.
In the case of Ford, the manufacturing of electric vehicles (EV) caused multimillion-dollar losses. The company announced losses of $2.8 billion in August 2023. As indicated in its 2023 financial results report, the Michigan-based company had major losses in 2023. "It will be a loss of around $4.5 billion for Ford Model e (electric model), reflecting the pricing environment, disciplined investments in new products and capacity, and other costs," according to a statement.
However, these manufacturers have not been the only ones to set these types of transition goals to electric vehicles and give up on them due to monetary losses and little growth. Other major companies such as GM, Stellantis, Volvo, BMW, Toyota and Volkswagen made similar announcements and almost all of them have given up on their plans or have changed large parts of them.
Electric cars are less "reliable"
In recent years, it has become clear that markets and drivers do not trust the effectiveness of electric vehicles. A Consumer Reports survey showed that electric cars are less "reliable" than those with traditional gasoline engines.
The survey revealed that electric car owners reported 79% more problems with their cars than those powered by gasoline engines (manufactured from 2000 to 2023). The figure increases to 146% more problems for plug-in hybrid cars. However, hybrid models that do not require charging have 26% fewer problems than the gas-powered version:
As more electric vehicles come to market and automakers build each model in greater numbers, we are seeing some of them having problems with electric vehicle powertrain motors, electric vehicle charging systems, and electric vehicle batteries.
This negative data is reflected in the opinions of drivers (who are mostly against electric vehicles ). 63% of Americans said they would not buy an electric car, according to a survey conducted by the Pew Research Center. Half of adults said they would not consider or are unlikely to consider purchasing an electric car in the future. Another 13% stated, directly, that they do not plan to purchase one.
Another survey showed that in the first six months of this year, sales of electric vehicles only increased by 49% worldwide (compared to an increase of 63% in 2022). In the country, despite the Biden administration's commitment to electric cars, only 28% of Americans believe they are useful.
Rental companies are also losing money
The car rental company Hertz announced in January that it was selling off around 20,000 electric vehicles available from its subsidiary in the United States. These include models from Tesla and other manufacturers. The company, which in 2022 had planned to remodel its fleet of cars towards electric vehicles, has also had second thoughts on this measure.
According to Reuters, the alleged reason for selling off its fleet of electric vehicles was due to the high cost derived from crashes and minor accidents, which put the company's accounts out of balance. Hertz decided to maintain its gasoline-powered vehicles, as well as the hybrids. Hertz had planned to acquire 100,000 units of Tesla, along with another 65,000 units of Polestar, a Swedish producer acquired in 2025 by the Volvo group. The board's decision came after Hertz shares fell 4%.
The German rental company Sixt is also getting rid of its electric vehicles. In December 2023, it was revealed that the company had not purchased Tesla units since 2022. According to Reuters, Sixt is selling some of its electric models as part of its fleet change program.
