Electrification: A Closer Look

Consumer interest in and demand for electrified vehicles – which include hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs) and full battery electric vehicles (BEVs) – has 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 electrified vehicles grew to just 2 percent of the total U.S. passenger vehicle market. But from 2011 to early 2013, the market for electrified vehicles 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. At the same time, utilities are working to understand how to provide power to plug-in vehicles in a way that is effective in meeting consumer needs, efficient for electricity providers and 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 electrified vehicles? As gas prices remain high, consumers are increasingly interested in alternative and less-expensive fueling options, such as electricity. In addition, the cost of electrified vehicles continues to come down, due in part to rapidly advancing electrified vehicle technology. Other benefits 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 electrified vehicles (especially HEVs) are beginning to become more competitive, they remain relatively high. In addition, consumers continue to have concerns about the driving range of PHEVs. And for electrified vehicles to achieve their full potential to cut lifecycle automotive GHG emissions, low-carbon electric 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 lithium and rare earth metals. Furthermore, customer demand for electric vehicles must continue to grow for these vehicles to have a significant effect on overall transportation-sector emissions without the use of subsidies and incentives.

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.