Will Electric Vehicles Be The Answer to Rising Petrol Prices?

With Singapore aiming towards a carbon-lite future and the cost of petrol on the rise, electric vehicles seem increasingly like a viable option. Are they really?

The talk about electric vehicles in Singapore goes all sorts of ways in the modern business landscape. The question on whether or not the concept remains a stable choice for consumers has long since passed, but the question on whether it will actually be a dominant challenger to the long established gas combustion engine remains to be seen. 

Despite the popularity of flagship brands such as Tesla and Polestar, their market share in the larger total automobile market still remains minuscule compared to their more established competitors like Toyota and Ford.

But with rising petrol prices, it’s starting to look like electric vehicles will need to set up their game in order to meet the rising demand of consumers looking for alternatives that don’t rely on so much fossil fuel. 

Though Singaporeans still wonder whether the electric car cost per kilometre in Singapore as well as why electric cars are expensive in Singapore in general, which might put the adoption of electric vehicles in the country to a dubious level.

Gas-powered combustion engines in 2022

Despite all the hype surrounding electric vehicles, or EVs as they are popularly known, gas-powered cars still largely dominate the share of all cars currently on the road. The continued prevalence of gas-powered cars is so evident in the current world that a Bloomberg research has shown that gas-powered cars will likely remain prevalent in the road, of roughly 60% saturation, all the way until 2040.

But much of this research and many like it are based on assumptions and trends that preceded the crude oil crisis the world is currently experiencing. With the onset of the COVID-19 pandemic disrupting many industries including global supply chains that are key to the transportation of fuel, the trajectory of fuel’s supremacy in the world doesn’t seem so certain now.

Now that the war in Ukraine has threatened global production of oil by tossing some of the world’s largest producers of crude into terse situations, consumers are starting to feel the consequences of a world so reliant on a single resource as prices spike and subsequent connected products follow suit. 

Even First World countries are starting to feel the sting, with citizens often asking why gas prices are increasing in Singapore, Korea, and Japan.

As these trends continue with rising frequency, consumers now ask, “Which vehicles do not need petrol to move?”, looking to find an alternative that can meet their demands without the pressures of both the economic and environmental impacts of fossil fuels.

The rise of electric vehicles

The volatility of fuel prices doesn’t necessarily mean that electric vehicles weren’t popular in their own right. During the earliest iterations of giant firms like Tesla, there was already looming interest in cars powered by alternative means. 

Early attempts at hydrogen powered cars and other vehicles powered by alternative fuels unfortunately fell flat, either through a too early entry in the market for consumers or strong lobbying from the gas industry.

But it was Tesla’s 2008 Roadster that started making waves on the possibilities of fully electric vehicles. While older models from other manufacturers often sported low mileage and battery problems (including a scarcity of replacement parts), the first iteration of the Tesla Roadster reportedly managed to travel 393 kilometers on a single charge while maintaining accelerations of 97km/h in under four seconds.

From there, the eventual popularity of the electric vehicle market was only bound to increase as technologies behind each car continued to develop. Tesla released further iterations of the Roadster as well as new models like the Model X, while other tent pole electric vehicle makers began entering the market with their own products, such as Polestar with the now released Polestar V60.

The market has generated so much growth that even traditional car manufacturers have entered the market, from Ford’s fully electric F-150 and the Volvo XC90. Even luxury automaker Porsche has released its own version of its popular Cayenne line of cars in fully electric make-ups.

Some Singaporeans now wonder whether electric cars will be cheaper in Singapore, especially with most models still taking a good amount of time before being put in the market.

Can EVs really compete in the automobile market?

But despite the relative weakening of the gas-combustion cars due to fluctuations in availability and price of fuels and the strong growth that electric vehicles have had in the last few years, the question still needs to be asked: Can EVs really compete in the automobile market?

As with any country just starting to take on more demand for electric vehicles within their local market, subsidies will likely be key in furthering adoption of the electric car versus traditional gas powered options. 

Countries like India and Thailand have adopted their own measures for subsidies not just for EV-initiatives but also for actual purchases of cars that can make electric vehicles cheaper by comparison. Thailand in particular has adopted a 15% subsidy on the selling price for elective vehicles for all consumers looking to make the switch.

Singapore themselves are putting aside S$30 million to EV-related initiatives that can help address why fuel prices are increasing in Singapore and make it easier for firms to get their electric vehicle inclined projects off the ground. 

In line with these plans, global vehicle leasing and distribution company Goldbell Group had recently acquired Singapore’s BlueSG which focuses on electric car sharing. This investment is reportedly already planned for the next few years, with S$70 million planned to be added on the already undisclosed acquisition amount.

Final thoughts on EVs in the market

Electric vehicles have been one of the fastest growing industries in a market that’s been wrought with changes left and right. But to be truly a game changer, it will likely need assistance to compete with an industry so reliant on the current system. EVs will likely gain more and more prominence in the coming years, likely even to challenge gas powered cars. 

The question, then, is not if, but when. 

Read these next：
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Singapore Budget 2021: Electric Vehicles To Go The Extra Mile With $30 Million Support From Govt
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Car Sharing Options In Singapore