The New Electric SUV Market under Battery Supply Constraints: Might They Increase CO2 Emissions?

Two trends have shaped the European car market over the past decade: electrification and SUVisation. Recently, they have merged in a new product: the electric sport utility vehicle. This paper contrasts the view that regards this innovation as a technological solution to mitigate road transport emissions with a broader view that takes into account the battery requirement and profitability of such type of electric car. This broad view is formalised in a system dynamics model that captures the potential effects of supply side constraints. Four scenarios are simulated. The results show that the levels of CO2 emissions of new cars are substantially reduced only in the one that assumes lower motorisation. Based on these simulations, the conclusion that the diffusion of electric sport utility vehicles does not necessarily contribute to mitigating car emissions in Europe is drawn. Less reliance on technology fixes, downsizing and reduced motorisation are identified as solutions worth investigating to meet ambitious climate goals. Further research on how vehicle manufacturers distribute batteries is needed.