With gasoline selling for less than $2 a gallon in some states, it's fair to ask whether the industry's investment in electric vehicles has been an expensive blunder.
That is the question pundits are beginning to mutter as world oil prices crash. The industry's multibillion-dollar leap to EVs and greener fuel-efficient cars five years ago was triggered by rising fuel prices and a strident new environmental awareness that seemed to sweep the planet.
A study commissioned by the National Association of Convenience Stores -- a business sector heavily reliant on gasoline sales -- reported in December that interest in alternative-fuel vehicles is declining as gasoline prices fall. Its study found that among consumers who say they are interested in an alternative-fuel vehicle, 34 percent said in November they would consider an electric car, compared with 55 percent in April.
But plummeting pump prices aside, two facts haven't changed, carmakers and analysts say: Automakers remain under regulatory pressure to make giant gains in the average fuel economy and emissions of their U.S. fleets by the 2025 model year. And delivering those gains will require some level of electric-drive market penetration.
"Nobody can predict the price of oil," warns Carlos Ghosn, CEO of Nissan Motor Corp., the global EV segment leader. "But there is one thing which is not going to change: The emission problem is getting more and more serious. The restrictions coming from regulation are going to get tougher. There is no way you're going to meet these emissions restrictions and regulations without zero emissions."