Rise of the ICE Age
Internal combustion engine vehicles may burn hot but EVs are the hot commodity right now. Despite that, EVs are being put on ice by their counterparts as age overcomes beauty.
What happened: A new study from S&P Global Mobility found the average age of light-duty vehicles in the US has reached a record high of 12.5 years old. This is compared to 20 years ago, when the average age of vehicles in operation (VIO) averaged just 9.7 years old.
- The average age has increased for the last six years with 2022 being the largest jump since the 2008 recession.
By 2028, S&P Global Mobility expects nearly three out of every four vehicles in the US will be older than six years.
Average age by vehicle type
Cars staying on the road longer reduces the need for new materials for new vehicles, though this looks to be driven less by virtue and more by money. The combined forces of limited vehicle supplies, reduced demand due to rising interest rates, and inflation are to thank.
The net result: slower EV adoption
Drivers have been holding onto their old beaters for longer, while the trends for EVs have been heading in the opposite direction as electric vehicles leave the fleet quicker than their gasoline and diesel-powered counterparts.
- The average age of EVs in the US has reduced from 3.7 years to 3.6 years which S&P reports is due to the increase in EV purchases.
Zoom out: Other causes for the EV trends, like battery life performance, are yet to be confirmed given the short time modern EVs have been around. Though, if these trends continue, it may take longer to achieve and all-EV fleet.