by High Price and Limited Choice Are Hampering Demand for Electric Vehicles
It is no secret that electric vehicles still cost significantly more than cars with internal combustion engines. Recent data from COX Automotive only confirms this difference: in November, the average price of a new car was $49,814, while the average price of an electric vehicle reached $58,638.
Rivian CEO RJ Scaringe points precisely to this price difference, along with the lack of variety in the US market, as the two main reasons for the sluggish demand for electric vehicles.
Speaking at the Fortune’s Brainstorm AI conference, Scaringe stated that America cannot even come close to offering the choice that buyers have in Europe and China. He particularly emphasized pricing policy as the reason why the penetration rate of electric vehicles in the US is only 8 percent.
He called it a “shocking lack of choice,” claiming that American buyers have “significantly fewer than five worthy options” near the average price of a new car.
Tesla – The Only Worthy Choice?
Somewhat unexpectedly, he cited Tesla as the manufacturer with the only truly attractive electric vehicles priced below $50,000. The Model Y is available for less than $50,000, and the Model 3 starts below $40,000.
“And that is not reflective of a healthy market with a lot of choice,” said Scaringe. “If you think about it from a consumer standpoint, you have 300 different options for internal combustion engine cars at that price or below, and maybe only one very attractive electric vehicle option.”
Of course, the CEO did not miss the opportunity to promote his brand’s upcoming model – the R2, an SUV with a target starting price of $45,000.
The Competitive Markets of Europe and China
While American electric vehicle buyers wait for more options, competitors abroad are battling on saturated markets. Europe offers a huge selection from Volkswagen, BMW, Mercedes, and a growing list of Chinese importers.
China itself remains the world’s most competitive electric vehicle battleground, where BYD, Nio, Xpeng, Leapmotor, and even newcomer Xiaomi are fighting tooth and nail for market share.
In this context, Scaringe supported the Trump administration’s push to bring more manufacturing back to the US. He believes this will help domestic brands scale electric vehicle deliveries and ultimately lower costs. Now it remains to be seen if he is right.
RJ Scaringe’s position clearly points to the structural problems of the American electric vehicle market, which distinguish it from the dynamic European and Chinese ones. The success of future affordable models, such as the Rivian R2, could become a key test: whether a local manufacturer can change the equation by offering a quality alternative at a competitive price, or whether American buyers will have to continue waiting for broader penetration by global players. This is a question not only of business strategy but also of the accessibility of technology for the general public.
