PHOENIX - Major auto manufacturers are investing big in electric vehicles, and supply will only grow over the next few years.
At the same time, there are questions on whether demand is keeping up with supply.
Here's what you should know.
Are there demands for EVs right now?
According to iseecars.com Executive Analyst Karl Brauer, the EV market is facing some challenges.
"EV market and EV values have dropped substantially," said Brauer. "You could use the word ‘collapse’ here."
Brauer said EV prices have dropped 29.5%, year over year.
"To see this level of kind of hesitation from the consumers to jump into the EV world right, on the cusp of all these EVs that have come in the past year and more coming in the next year and already stacking up at dealerships, it's something to be concerned about," said Brauer.
Why is the EV market dropping?
According to a July 2023 article by website Green Car Reports, EV sales have increased, but not as quick;y as the supply of EVs.
The article also cited a number of factors that are holding back EV sales growth, such as dealers that are not properly prepared for EVs, lack of universal interest in EVs, misconceptions over EVs having a higher cost of overall ownership, and confusion over federal tax policies and rules over EVs.
What does that mean for Arizona businesses making EVs or EV-related products?
For some businesses like Nxu, they are still planning for the future.
"We are hiring a lot," said Nxu's CEO, Mark Hanchett.
Nxu is a Mesa-born company that builds battery cells, find energy storage solutions, and manufacture megawatt-plug charging stations.
"This will charge as fast as the Tesla will accept, so as much power as it wants, this system will accept it," said Hanchett.
There are a number of EV makers or EV-related businesses that have set up shop in Arizona. Some of the well-known companies include Lucid and ElectraMeccahnica. Hanchett said he believe the demand for EVs are there, but infrastructure, like the ones Nxu make, needs to advance quickly.
"You're in the flip phone phase. To get to the smartphone phase, we just a need a couple milestone improvements. Battery technology and efficiency, combine it with infrastructure and that comes together, and it's going to take off like a rocket."
What about companies outside of Arizona? Are they investing in EVs?
A number of companies are investing in EV operations in the U.S.
On July 12, the Associated Press reported that Kia will invest $200m in its Georgia factory, as part of an effort to start producing EV SUVs at the plant by early 2024.
On July 6, the AP also reported that carmaker Stellantis has signed a deal with NioCorp, which is planning to mine for rare earth elements in southeast Nebraska. Stellantis is the carmaker behind a number of car brands that sell vehicles in the U.S., including Chrysler, Alfa Romeo, and Maserati.
The Associated Press (AP) contributed to this report.