So, let’s pause for a moment and take the measure of where we are on the road to a “green” automotive future:

• Global electric car sales, according to Trend Investing, were up 127 per cent through the first 10 months of this year, with a market share just shy of 5.0 per cent (carmakers have sold more than 500,000 battery electric cars in Europe alone this year);
• U.S. President-elect Joe Biden campaigned on pro-EV policies which he promises to enact starting Jan 20, 2021;
• Various countries and regions, from Quebec to the United Kingdom say they will ban sales of new gas and diesel cars from 2030 or 2035, depending on jurisdiction;
• Tesla, the world’s most valuable car company, will be included on the benchmark S&P 500 index on Dec. 21 which suggest its market cap will grow higher still;
• The electrification of automobiles and heating in buildings, notes Bloomberg, is taking root, prompting Goldman Sachs Group Inc., to project that next year spending on renewable power will overtake that of oil and gas drilling for the first time;
• NextEra Energy Inc., the world’s most valuable utility, briefly surpassed Exxon Mobil Corp. in market capitalization in early October, adds Bloomberg, prompting many to predict the end of the oil age is nigh;
• The pandemic, adds Bloomberg, has shown that gasoline/diesel cars have peaked, that the “internal combustion engine (ICE)” is history;
• An absolute flood of new EV model announcements has become overwhelming, including intriguing details about Hyundai Motors’ new E-GMP platform this week – which will underpin 23 new battery electric vehicles (BEVs) for the Hyundai, Kia and Genesis brands by 2025;
• The world is awash in nearly a billion cars that still run on oil-based products such as gasoline and diesel fuel, and, as RealClearEnergy.com reports, oil isn’t going away “because it packs a much bigger punch than alternatives.”

Okay, which one of these is not like the others? If you said the last, read on.

Hyundai Motor’s new EV platform.

Yes, this last bullet point is worrisome for EV fans and investors who are now betting big on a shift to renewable energy and electric and electrified vehicles. If you have put money on Tesla, your competition isn’t just Volkswagen (the world’s No. 2 EV makers), or Hyundai or any other automaker investing billions in EV. No, your competition is the traditional ICE car, which is cheaper to buy by a wide margin, and a billion even cheaper used cars already on the road now.

That said, I would point out that Goldman Sachs analyst Mark Delaney just raised his outlook on Tesla to “buy” from “neutral,” noting “the shift toward battery electric vehicle adoption is accelerating and will occur faster than our prior view.”

Delaney, like other analysts chewing on and spitting out all sorts of rosy EV and renewable news, pointed to a swift decline in battery prices and the rise of government regulations which together will lead to the eventual phasing out of higher-emission vehicles that, of course, use oil.

Hyundai’s “electric era” announcement.

“The energy business should also benefit from the regulatory shift toward carbon reduction and clean energy, and solar market valuations have similarly accelerated,” Delaney noted in The Globe and Mail. Tesla shares, if you hadn’t noticed, are up almost 600 per cent in 2020, to around $600 (US). His target price for Tesla now: $780 (US).

I am, I confess, a cheerleader of the incipient but not yet inevitable shift to electric and even electrified vehicles, though I have long argued – in vain, so far – that Tesla will, in the end, collapse under the weight of Elon Musk’s ego. So far I’ve been wrong, but it’s early days in the EV business and Musk is young-ish. He still has time to implode.

But my so-called pom-poms for EVs go limp in the face of this fact from RealClearEnergy: the energy density of gasoline is approximately 47.5 megajoules per kilogram, or some 100 times more than that of an electric car’s lithium-ion battery (about 0.4 MJ/kg).

Ugh.

Back at the turn of the 20^th century, EVs comprised some 40 per cent of vehicle sales, though they were eventually crushed by the energy density (and what it means for range-per-tank of fuel and overall convenience) of gasoline/diesel. Oil remains the most convenient and sensible source of automotive fuel, at least in terms of energy density and refueling infrastructure. For the moment.

The economic case for oil is obvious, but the landscape is changing fast. An existential reality is creeping onto the landscape: climate change, which is a scientific reality — though some debate the precise role humans have in it — and one with potentially deadly consequences. It may make economic and practical sense to run cars on gasoline/diesel, but it might also prove suicidal to continue down this road.

It is also becoming increasing uncool to drive a gas-guzzler. The auto industry is rooted in the emotional connection between cars and drivers. If the ICE becomes undeniably and universally uncool, and if EVs are cost-competitive, then we’ll see a quick and wholesale shift to plug-in cars.

Indeed, this sort to movement in public sentiment to clean energy appears to be accelerating. In “Green Supermajors,” Bloomberg presents the case for the changing nature of the energy sector its profound implications for the auto industry.

“The tipping point may come next year, when Goldman Sachs Group Inc. projects that spending on renewable power will overtake that of oil and gas drilling for the first time,” notes the report, adding that “mainstream clean energy bets” have become central for many investors, and their numbers are growing.

Clean energy giants like Enel, Iberdrola, NextEra Energy and Orsted are upending energy markets as solar panels and wind turbines grow ever-cheaper. In Canada, renewable energy companies such as Boralex and Brookfield Renewable Partners (and Corporation) are enjoying spectacular growth, even as more staid energy companies such as Fortis concentrate on making the move to cleaner power.

The renewable movement is all about finding clean ways to make electricity, which in turn points to the need for automakers to make cars and trucks that are battery-powered. Europe is already moving in this direction in a big way.

While the race to EV dominance appears to be one outcome of Joe Biden’s election as U.S. president, global players like Hyundai do not intend to be left behind. Here’s prooof.

What underpins potentially explosive growth in renewables is the emerging race between the world’s two largest economies, the United States and China. Bloomberg notes that China began shifting its state-run energy companies toward renewable years ago, and now China Energy Investment Corp. has close to 40 gigawatts of renewable power generation capacity — more than any of the European and American majors. The skeptics will note that China Energy produced 185 gigawatts of thermal power from coal in 2019, but the long-term trend is towards renewables and away from coal.

“Over the long term, electricity is going to steal market share from other sources of energy,” Shayle Kann, a managing director at Energy Impact Partners, a New York-based investment fund, tells Bloomberg.

It’s reasonable to believe that over the long term, EVs will steal market share from the good, old ICE. Europe will be an important market in all this, but the final outcome will be determined by China and the U.S. So, where are we?

Reuters reports that the electric car market share in China for October was 7.0 per cent, and year-to-date 5.4 per cent. That in the midst of a global pandemic and economic slowdown that started in China. Reuters adds that China has a 20 per cent target for new energy vehicles for 2025, and by 2035 50 per cent of vehicle sales are to be NEV — electric, plug-in hybrid or fuel cell-powered, with the rest old-style hybrids like Toyota’s Prius.

As for the U.S., the incoming president says his administration will give EVs in particular and renewable energy initiatives in general a jolt – in an effort designed to create jobs, address climate change and stimulate the creation or evolution of EV and renewable technologies.

On the campaign trail, Trend Investing and many others have noted that President-elect Biden often listed his EV goals:

• Building out electric vehicle charging infrastructure with at least 500,000 additional charging stations;
• Creating 1 million new jobs in the U.S. auto industry alone by advancing EVs into the marketplace.
• Shifting the U.S. Government fleet to EVs;
• Supporting states such as California that have already created stricter ICE emissions guidelines and mandated the phasing out of ICE cars.

Biden, unlike the Trump, reads and thinks about all sorts of things other than himself. Biden is well aware that China has a massive lead in EVs – from battery technology to infrastructure supports. Why do you think Warren Buffet has a huge investment in leading China EV maker BYD? It seems quite possible that the Biden administration will frame a push for EVs and renewables in the kind of moonshot terms that President Kennedy employed to spur the U.S. to catch up to the Soviet Union in the space race of the 1960s.

By the way, there is now credible research to suggest that EVs and ICE cars will reach price parity sometime in the next few years, notes Trend Investing. The China-versus-U.S. EV race will surely intensify efforts to make EVs more affordable and convenient, still It would be unwise to bet against the world’s two economic superpowers.

So, while oil’s indispensability for all forms of transportation – planes, trains, trucks and automobiles – has been essentially unchallenged since the Model T, we seem to be on the cusp of an unprecedented shift. True, you won’t be flying in a battery-powered 737 any time soon, but your next car is very like to have a plug.