This seems fairly obvious, doesn't it? The subsidies are intended to help spur the adoption of EVs, and if they are withdrawn, that adoption would certainly slow if not stop entirely because a typical EV costs about twice what a comparable conventional car costs.
So the question is: What is it worth for the government to subsidize EVs over other cars?
Will the country save $XX dollars in healthcare costs over the life of that vehicle? Is the difference enough to subsidize an EV over a fuel-efficient conventional car or hybrid?
What would it take for a consumer to make the conscious decision to buy an EV at $40,000 over a comparable car that gets 30 mpg for $20,000?
The goal of the government subsidary is to get the ball rolling. As popularity goes up; more products will come into the market. Competition drives price down. For EV market, there is at least 1 more factor which is charging station, or in general, infrastructure support. I believe US government is looking for better infrastructure being build by cities and by gas station owner. The challenge is with so many different type of charging specification, which one shall be built?
The EU or Asia market is different. The public transportation is very matural. A car is either luxury or leisure. Charging station at home will normaily be enough. No doubt, adding charging station by the parking meters or in the parking garage wouldn't be too much of a challenge in a well populated region.
Remove the subsidies! We can't build more nuclear plants, are loathe to drill for oil (one of the most condensed forms of solar energy), are freaked by fracking, and condemn coal plants for their emissions. Yet, we act and think like EVs are the solution. The electricity to top up all those batteries has to come from somewhere, and most likely it'll be a coal-fired plant, fed by coal mined and transported by massively inefficient and carbon-burning trucks.
Any industry cannot remain forever under the support of govt subsidies. If a technology cannot become self-sustainable in a reasonable amount of time then it better be going out of circulation and back to drawing board
Subsidies won't last forever, were never intended to last forever and the effect will depend on when the subsidies are withdrawn. The article implies the only reason anyone buys an EV is the subsidy and that there will be no technical advancement to make subsidies less important and eventually unnecessary. Use of the word "bubble" is just click baiting sensationalism.
So mission accomplished, you got me to click on a pointlessly inflammatory article.
Patrick: You say remove the subsidies, citing the strain on energy resources, but don't present the alternative. Transit? Bicycles? Should only the wealthy have cars? Seriously, we need new thinking -- what's your vision of transportation that makes sense?
(I ride a bike 3 times as much as I drive, and take a ferry part-way to work -- although it costs as much as driving and takes twice as long. If I had a better idea, I'd be using it.)