4 Mobility Trends to Watch

The U.S. made significant investments in 2022 with the Bipartisan Infrastructure Law and the Inflation Reduction Act (IRA) to ensure 2023 would be a strong year for innovation, manufacturing, and the adoption of greener forms of transportation. While there have been some setbacks in early 2023 to a renewable energy future – like the greenlighting of the Willow Project by the Biden Administration, the transition to greener transportation and the energy that powers it are still trending strong. Below, our team shares a few trends that we believe will have an impact on the future of mobility during this transformational year.

If you’re interested in continuing to follow these trends throughout the year, subscribe to our newsletter, The Climate Brief, to be sent the list.

1. Electric Vehicles Aren’t Around the Corner Anymore–They Are in Your Driveway

With a wave of new electric vehicles (EVs) – from pickup trucks to sedans – set to hit the market in the next five years, 2023 is gearing up to be a pivotal year for electrifying mobility. Taking full effect on April 18th, the IRA’s EV tax incentives will help push more car buyers to choose electric when purchasing their next vehicles. 

But, there’s a catch. The U.S. Treasury released its proposed guidance, outlining which vehicles qualify for these tax credits based on strict U.S. battery sourcing and manufacturing requirements. To qualify for tax credits, the EV must be assembled in North America and contain a majority of battery minerals sourced from U.S. soil or a trade partner. The IRA’s carefully crafted caveat is designed to not only spur EV adoption, but also to get the U.S. battery business booming – on top of what’s already taken shape since the legislation was signed into law in August 2022. ‘American-made’ is not just a prideful statement – it’s also hopefully making the future more affordable and accessible.

2. Public Transportation: The Good, the Bad, and the Hope for the Future

It’s the best of times and the worst of times for public transportation. Ridership is slowly creeping back following a major drop at the start of the pandemic. Some systems in cities like Washington, DC, Albuquerque, and Kansas City are experimenting with free service in an effort to entice riders to return. New York lawmakers recently considered a sales tax on streaming services like Netflix just to ensure the ongoing operation of the Metropolitan Transportation Authority (MTA).

Thanks to bipartisan infrastructure legislation, hundreds of billions of dollars are pouring into major upgrades and new transportation projects across the country. That money is poised to address issues ranging from new routes with expanded service in underserved communities to the addition of modern energy-efficient vehicles that can dramatically reduce the public transit carbon footprint.

The problem, however, is a serious labor shortage which is delaying a full recovery for the public transportation industry. According to a recent report from the American Public Transportation Association, 96 percent of the agencies surveyed say they can’t find enough people to fill their open jobs. At the same time, the industry can’t retain the workers it already has. 

Meanwhile, commuters’ mobility needs and expectations are evolving. Due to higher energy costs – and of course, inflation – many American households are downsizing to only one car. In 2023, more people will be looking for alternative transportation solutions, including first-mile/last-mile transit options. Commuters are also demanding integration (read: Mobility as a Service, or MaaS) between services including buses, trains, scooters, rideshare, and whatever comes next. Perhaps most interesting is the growing pressure from riders to make transportation services more sensitive to climate and equity issues.

Despite the obstacles, public transportation remains a top priority for lawmakers, communities, and particularly for people who rely on these services. The data tell the story: a household can save nearly $10,000 by taking public transportation and living with one fewer car. Moreover, for every dollar invested in public transportation, up to five dollars is generated in economic returns. Communities that invest in public transportation reduce the nation’s carbon emissions by 63 million metric tons annually. That’s roughly the equivalent of removing 12.6 million internal combustion vehicles from our nation’s roads each year. 

So, keep an eye on the money. A lot of it will continue to flow toward projects that can help transit return not just to its full glory, but a new era of public transportation that can address some of the most critical issues of our time.

3.  Beat Out the Gas Pump With Accessible & Convenient Charging

Anxiety about how far you can travel on a single charge continues to be a top concern deterring Americans from going all-electric. While there are many other barriers we need to address as we green our nation’s fleet, overcoming the charging challenge is mission-critical. 

To reach the U.S. government’s goal of 50 percent zero-emission vehicle sales by 2030, the U.S. needs 1.2 million public and 28 million private EV chargers, according to McKinsey. To kickstart the effort, the Bipartisan Infrastructure Law dedicates $7.5 billion to EV charger infrastructure and the IRA restores tax credits for installing EV chargers in homes and businesses in nonurban and low-income communities. This year, additional investments and technological advancements, like fast charging, in-road charging and bi-directional charging, will play a critical role. 

Major DOE investments in batteries will help power this electrification, with Li-cycle receiving a $375 million conditional loan to fund the construction of a lithium recycling hub in Rochester, New York and Redwood Materials receiving $2 billion from DOE loans to produce cathode material and copper foil in Nevada. Private sector funding is also flooding into the space, with Ford building a new plant in Michigan. The challenge will be growing these smaller players in the U.S. market to rival legacy leaders in China.

Also on the horizon are novel battery technologies that promise to surpass the limits of current EV battery performance on a single charge. These battery innovations need to bridge the chasm from the lab to market, and achieve scale in the gigawatt era.

4. Autonomous Vehicles Get a Reality Check

As far as autonomous vehicles (AVs) go, most consumers are on the same page: love the idea of them, but don’t want to get into one quite yet.

Building AVs and training them to not just drive, but drive smoothly (so that you don’t get sick every time you get in one) and anticipate and avoid human error, is really, really hard, even for auto giants like Ford and VW. The process cannot be rushed. Luckily, people are getting more realistic about near-term capabilities.

Only a few years after everyone – from automakers to tech providers – threw down the self-driving gauntlet, we’ve already started to see the market for autonomous technologies thin out, and it will continue to in 2023. Shortly following the news of Argo AI’s shutdown in Q4 last year, lidar companies Ouster and Velodyne agreed to an all-stock merger, while Quanergy, which went public via SPAC less than two years ago, filed for bankruptcy in December. With respect to lidar – a key enabling technology for AVs – global automakers responsible for producing more than half of all vehicles sold worldwide annually are expected to make their decision on which lidar technology they plan to use for series production of their mid-decade models with highly automated capabilities within the next 18 or so months. Since the automotive industry operates on notoriously long timelines, the decisions made this year and next will impact the way cars are made for the next decade. This is common in the automotive industry, as the production of most technologies related to functional safety, such as airbags, advanced driver assistance systems (ADAS) scanners, and brakes tends to consolidate around two primary suppliers

Motivation for full self-driving is important, but we’re not living in a Jetsons era yet. Consumers and carmakers alike are starting to get more realistic about the near-term capabilities of autonomous technologies.

Tori Bentkover, Account Director 

If you’re interested in continuing to follow these trends throughout the year, subscribe to our newsletter, The Climate Brief, to be sent the list.

Have our previous predictions come to fruition? Catch up on our Trends to Watch posts from the past three years to see:

Five Cleantech Trends to Watch in 2022

Five Cleantech Trends to Watch in 2021

Six Cleantech Trends to Watch in 2020

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