Electrification: A Closer Look

Consumer interest in and demand for electrified vehicles (EVs) – which include hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs) and pure battery electric vehicles (BEVs) – have been growing. And recently, the rate of growth has increased significantly.

From 2000 to 2011 (i.e., the first 11 years that HEVs were available from major automakers in the U.S.), sales of EVs grew to just 2 percent of the total U.S. passenger vehicle market. But in 2012 and 2013, the market for EVs doubled; it now totals approximately 4 percent of U.S. passenger vehicle sales.

To meet this growing demand, most major automakers now offer some form of electrified vehicle. Ford offers six models, including three HEVs, two PHEVs and one BEV, as part of our “power of choice” strategy for delivering leading fuel economy for consumers regardless of what type of vehicle or powertrain technology they prefer. Sales of Ford’s EVs grew substantially in the past year. In 2013, Ford sold nearly 88,000 EVs, a record number for Ford. Also in 2013, Ford’s share of the overall EV retail market was 14.3 percent, up from 6.5 percent in 2012. Ford’s EVs are also making a significant contribution to reducing carbon emissions. As of late April 2014, owners of Ford’s plug-in electric vehicles, including the Focus BEV and Fusion and C‑MAX Energi PHEVs, had driven approximately 114 million all-electric miles, resulting in an approximately 8 million kg reduction in carbon dioxide (CO₂) compared to gasoline-powered miles¹.

Utilities are also working to understand how to provide power to plug-in vehicles in a way that is more effective in meeting consumer needs, more efficient for electricity providers and more environmentally sound. And a variety of organizations are developing infrastructure for charging vehicles at homes, at work and in other public places.

Why the rise in interest and activity in EVs? As gas prices remain high, consumers are increasingly interested in alternative and less-expensive fueling options, such as electricity. In addition, the cost of EVs continues to come down, due in part to technology advances and increasing production volumes. Other benefits of EVs can include lower greenhouse gas (GHG) emissions during vehicle use, increased use of domestic energy sources, decreased pressure on petroleum stocks and reduced urban air pollution. With the advanced information technologies and “smart grids,” electrified automobiles can even improve the efficiency of the power grid – thereby lowering electricity costs – and facilitate the use of renewable energy sources, such as wind and solar.

Still, many challenges remain. For example, even though the purchase prices of EVs (especially HEVs) are beginning to become more competitive, the price premium over conventional vehicles remains significant. In addition, consumers continue to have concerns about the driving range of BEVs. And for EVs to achieve their full potential to cut lifecycle automotive GHG emissions, low-carbon electricity generation must make up a greater part of the total energy supply, and electric vehicles must become functioning parts of smart grids. Also, battery technologies are still evolving, and the cost of new-generation batteries remains high. We are also assessing supply-chain issues associated with the materials needed to manufacture batteries, including the availability of lithium and rare earth elements. Furthermore, customer demand for EVs must continue to grow for these vehicles to have a significant effect on overall transportation-sector emissions.

We discuss all of these issues in more detail throughout this section, which provides an overview of Ford’s electrification strategy. The section also compares different electrification technologies and their environmental benefits. For more detail on Ford’s electric-vehicle technologies and other fuel-efficiency, advanced powertrain and alternative-fuel technologies, please see the Sustainable Technologies and Alternative Fuels Plan.