The darkest hour is before dawn

Happy New Year from EV inFocus to you all. However, if you're committed to the transition to a battery-electric land mobility future, we can forgive you for not feeling especially positive as we enter 2026.

Everywhere we look in the western hemisphere, the news appears to be bad. In the US, the Trump administration's far-right assault on efforts to tackle the climate emergency more generally, and on BEVs in particular, are having a chilling effect on sentiment.

Not helped, of course, by significant wavering in the commitments of the Detroit Three to their all-electric strategies, while storm clouds over the futures of Tesla, Rivian and Lucid are adding to the sense of gloom.

In Europe, OEM lobby group Acea is still not satisfied with the European Commission's concessions offered up in its mid-December Automotive Package. It continues to call both for further watering down of pre-2030 targets and to try to muddy waters with talk of technology neutrality, despite 2025 feeling like the year that the hydrogen-as-a-mobility-fuel fallacy finally died.

And here in EV inFocus' UK home, despite a 24pc year-on-year jump in new BEV registrations to within touching distance of the 500,000 mark, OEMs do not see the all-electric garden as rosy. Its lobby group the SMMT is grousing about the discounts its members have had to offer to get sufficiently close to annual targets to avoid fines, and is also calling for short-term goals to be more urgently reviewed.

Today is not tomorrow

So are BEV fans on both sides of the Atlantic right to be entering 2026 with something of a sense of despair? Well, yes and no, in EV inFocus' view. Clearly the US has taken a material step back on its journey towards all-electric over the past 12 months and it is hard to forecast things ameliorating substantially this year. And here in Europe, issues linger both over OEMs' appetite to make and sell BEVs and the public's appetite to buy them.

But it is also worth remembering that the path to where we've got now has hardly been a smooth one. Across all the West's major national markets in the past few years, we have seen drops in BEV buying demand as a result of changes in market circumstances, sometimes well-trailed, at other times short, sharp shocks.

And, largely, every market has eventually bounced back from these setbacks, albeit not always quickly or smoothly. EV inFocus is convinced that the headwinds that have buffeted BEV demand in 2025 and may continue to do so owing to both announced and potential regulatory changes in 2026 will also be overcome in the medium term, simply because the technology is already superior and there is huge scope for further innovation to extend that lead that is not open to the ICE alternative. We will not bang on again here about the gamechanger that will be widespread V-2-X for those with access to home charging, but it's only one of what are many improvements to the all-electric owning and driving experience that will be coming down the pipe before the end of the decade.

The US will almost certainly have to wait longer for a return to health than Europe. But, while it's always difficult for us non-Americans, even those who might lean to the right economically, to get our head around the attraction of the current president, recent election results seem to point to his ability to make further changes to legislation hindering BEV uptake being significantly curtailed by the end of 2026 and for his political philosophy, if one can dignify it with such a label, being rejected in late 2028. Which should definitely help.

It's the economy, stupid

But it is not changing political winds in Washington that will play the major role in getting the US' BEV journey back on track. It will be in OEM boardrooms where the picture will change dramatically, driven by economics.

Take Ford as an example. Should one conclude that Jim Farley has been faking his enthusiasm for BEVs for several years, in light of his company's recent pivot in its all-electric strategy? If so, we'd humbly suggest he's wasted in Detroit and should get himself to Hollywood, where his talents could be employed to much greater fame, if not necessarily fortune.

No, Ford is cancelling the F-150 Lightning because it's a lossmaker that it cannot see becoming profitable. And the new models it was developing through its conventional processes have gone the same way for the same reason. The smaller BEVs being worked on by its skunkworks team on the West Coast stay because Ford sees it making money from them in the future.

It's a similar story in Europe, if perhaps with wider societal acceptance and (somewhat) better economics. OEMs might be able to scrape a profit on their newest and/or best-selling BEVs, but they still make more money selling ICEs or hybrids.

Thus they're juggling: selling enough all-electric models to avoid penalties imposed for missing targets imposed by the EU and/or national governments, but ideally only just that many and no more.

Demand motivation

And that balancing act impacts hugely on the role OEMs are currently prepared to play in promoting the switch to BEV. Which, we shouldn't forget, is a seismic technological switch to be digested by a buying public that ranges from the well-informed all the way through to the ignorant and the deliberately misinformed.

It is interesting and perhaps instructive that the lukewarm Acea response to the Automotive Package referred to " demand-side enablers, such as charging infrastructure". Such service providers obviously have a role, as do governments who can adjust fiscal and regulatory to stimulate, or indeed retard, BEV adoption.

But among the biggest demand-side enablers are, of course, the hugely well-funded and sophisticated marketing departments of the OEMs themselves. If their combined weight was thrown behind the promotion of all-electric models, buyer appetite would, EV inFocus confidently predicts, rise exponentially.

Why, though, would OEMs embark on such a strategy to promote lower margin products, some of which might even still be loss-making except for their benefit in avoiding fines, ahead of selling vehicles with more cream on top? A particularly far-sighted CEO might argue that there is tactical benefit in positioning most strongly for what will be the dominant mobility technology of the 2030. But, beyond the meme stock Tesla holders with little choice but to cling to Elon Musk's pie-in-the-sky promises of jam tomorrow, investors with the patience to tolerate such long-term positioning are few and far between. Just ask former Volvo Cars' CEO Jim Rowan...

So, in fact, EV inFocus can quite understand what the legacy OEMs in the US and Europe are largely doing: trying to develop BEVs with better economics while extending and even, in the short term, expanding the window where demand for currently more profitable products persists. We even agree with Acea on its views on its views about the relevance of 2030 and 2035, albeit not necessarily for the same reasons as the lobby group.

For cars at least, the move from 100pc all-electric sales from 2035 to 90pc is meaningless. There is simply no way that, by the middle of the next decade, one-in-ten buyers of new cars in Europe will want anything other than the default that BEV will be by then. It's like saying at the start of 2011 that, by 2020, 10pc of customers might still want a Nokia brick or Blackberry rather than a smart phone. Didn't happen then, won't happen in nine years' time.

Future shape

What is far more important, as per Acea, is that we look at what happens over the next few years. We're clearly cynical enough to believe that OEMs want reductions in interim targets purely to benefit their bottom lines, and firm that the EU or national governments should not indulge this prioritisation of corporate greed over the climate emergency.

But an honest discussion over how the European automotive industry navigates from where we are now to the new normal where BEVs are the default car buy is something that could benefit all stakeholders. And the reason for this is at least as much geopolitical as economic, although both are intertwined and the latter remains hugely important too.

EV inFocus would like to think it is not partisanly Sino-phobic. But what the past few weeks have told us is that any assumptions that the global political map is stable should be thrown out the window. Credible reports that fleets of Chinese-made buses in European cities have kill switches that could be activated remotely from outside the continent, and unconvincing denials of the same from Beijing, should be digested in the knowledge that it is far from beyond the bounds of possibility that China could move from being an economic rival to an active warfare enemy.

The US may move much more slowly to a BEV-led mobility model than Europe. But that reduced speed may also allow it to develop a far less China-dependent all-electric ecosystem, from battery raw materials all the way through to fabrication, than Europe's current trajectory. And that could be far more valuable than it appears even at present.

As such, EV inFocus' two main takeaways for the year ahead would be thus: don't get too downhearted about the state of the BEV market in 2026, the years to come will look vey different and increasingly brighter. And, secondly, Europe should engage in a genuine review of how it gets to the inevitable all-electric future, not motivated purely by OEM money-grabbing, but by a mutual desire to rebuild the European automotive sector to withstand both economic and political shocks yet to come.