The Electric Car Transition Unravels Slowly, Then All at Once

(Bloomberg) — The global transition to electric vehicles is beginning to unravel the way major changeovers often do: slowly at first, then all at once.

This week brought a cascade of signals that the EV era is entering a more uncertain, more contested phase. The European Commission backed away from what had been the world’s most aggressive timeline for phasing out internal-combustion engines, granting manufacturers and consumers more time to move off gasoline. A day earlier, Ford (F) Motor Co. announced $19.5 billion in charges tied to the retreat from an electric strategy it vowed to go all in on eight years ago.

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The pullback is no longer confined to a few laggards or skeptics. From relative newcomers to legacy giants, the signs of reckoning have been mounting for months.

Take Tesla (TSLA) Inc., the US company that did more than any other in the world to kick-start the EV uprising. The Elon Musk-led manufacturer was never going to keep up the meteoric rise pulled off at the beginning of the decade, but it’s no longer just slowing down — worldwide vehicle deliveries are poised to drop for the second year in a row. Musk’s interests have wandered from pursuing a $25,000 electric car to developing humanoid robots and driverless taxis.

China’s BYD (BYDDF) Co. will become the new No. 1 purveyor of battery-electric cars in 2025, though it too is now having growing pains, with total sales falling each of the last three months. The company is still producing one plug-in hybrid with a gas engine under the hood for every battery-only EV, and its momentum is stalling in part because authorities in Beijing are increasingly scrutinizing pricing practices.

Ford has had plenty of company in struggling to catch up with the electric leaders.

Its archrival General Motors (GM) Co. recently incurred $1.6 billion in charges tied to paring EV production capacity, and flagged more such moves may be in the offing. Stellantis NV has scrapped plans for a fully electric Ram pickup and revived gas-guzzling V-8 engines that it will have no trouble selling in a US market that has hollowed out fuel economy and emissions standards.

When Volkswagen (VWAGY) AG — Europe’s carmaker that was once most motivated to chase Tesla — ends output of electric ID.3 hatchbacks this month in Dresden, it will be the first time in 88 years the carmaker will have ceased production at a German assembly plant. VW too has taken substantial financial blows, booking €4.7 billion ($5.5 billion) in charges tied to its subsidiary Porsche AG reversing from EVs.