The electric car revolution

How popular are electric cars?
Right now, they make up just 1 percent of the global automobile market. But sales jumped 36 percent last year, to 750,000 worldwide, and China, the world's largest car market, is betting big on electric. In September, Beijing announced it plans to completely ban the sale of gas and diesel vehicles at some future, unannounced date, while India, Britain, France, and other countries have set their own 2030 or 2040 deadlines. U.S. automakers are now racing to get a piece of the emerging electric market. GM and Ford have promised to roll out a combined total of more than 30 electric models by 2023......

What incentives do governments offer?

In the U.S., a federal rebate program gives electric vehicle buyers a $7,500 tax credit for the first 200,000 vehicles a carmaker delivers. States offer their own generous goodies on top of that — including tax credits, free parking spots, and preferential highway lanes. China and Denmark give motorists a 23 percent and 49 percent discount on electric cars, respectively. These subsidies are crucial to the survival of the electric car market; even with the plunge in prices, lithium-ion batteries still add about $20,000 to the cost of an electric car, making plug-ins unaffordable without rebates and tax credits. But electric car proponents think they have two big factors on their side: China and basic economics.

Why is China so important?

The Chinese government is doubling down on electric, not just to reduce the choking smog blanketing its cities but also to help its car manufacturers Those manufacturers have already developed 100 electric models, leaving other nations' seize control of the global automobile market.automakers in the dust. Even without Beijing's push, many analysts believe that electric cars have the winning economic formula — so much so that researchers at Bloomberg New Energy Finance estimate plug-ins will make up the majority of cars worldwide by 2040. Electric vehicles (EVs) have fewer than 20 moving parts, as opposed to 2,000 in combustion engines, and thus require less maintenance. Their fuel costs are much lower. When up-front prices finally drop to below those of gas-guzzlers, says Tona Seba of technology think tank RethinkX, "the rational economic choice will be to buy the EV."