Key Technologies, Challenges, and Trends in Electric Vehicles: Implications for the Global Automotive Industry

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Résumé:

Purpose of the Study

The expansion of electric vehicles (EVs) is reshaping the global automotive industry, driven by technological advancements, regulatory policies, and evolving consumer preferences. This study examines key technologies enabling EV development, major challenges affecting adoption, and emerging trends influencing the industry's future. Special attention is given to how China, the United States, and the European Union are structuring policies and industrial strategies to navigate this transition.

Methodology

This research follows a systematic literature review approach, incorporating:

 Scientific literature analysis from MDPI, Science Direct, Elsevier, and Redalyc, focusing on EV technologies and policy frameworks.

 Industry reports and case studies from institutions such as the International Energy Agency (IEA) and automotive manufacturers (Toyota, Volkswagen, Tesla, BYD).

 Comparative policy analysis assessing global regulatory measures, incentives, and infrastructure investments.

This approach ensures a comprehensive understanding of technological developments and their impact on industry dynamics.

Main Findings

a) Key Technologies in Electric Vehicles

Electric vehicle (EV) development is driven by continuous advancements in key technologies that are reshaping the automotive industry. Battery technology has significantly evolved, with innovations in lithium-ion and solid-state batteries improving energy efficiency, reducing charging times, and lowering production costs (Tarascon & Armand, 2001; Helmers & Marx, 2012). These advancements make EVs more viable for mainstream adoption while addressing concerns about range and sustainability. Additionally, the expansion of ultra-fast charging networks and the integration of smart grids have become critical factors in accelerating mass adoption (Iberdrola, 2023; Arrow, 2022). Reliable and widespread charging infrastructure is essential to support the increasing number of EVs on the road and ensure a seamless transition to electrified transportation. Another crucial technological advancement is powertrain electrification, where the development of electric axles and traction modules enhances vehicle efficiency and performance, optimizing energy use and extending driving range (Mordor Intelligence, 2024). Moreover, vehicle connectivity and artificial intelligence (AI) integration are transforming the EV landscape, enabling real-time energy consumption monitoring, predictive maintenance, and advanced autonomous driving capabilities, all of which contribute to safer and more efficient mobility (Husain et al., 2021).

b) Challenges in EV Development

Despite these technological strides, EV adoption still faces multiple challenges. One of the most pressing concerns is raw material dependency. The increasing demand for essential minerals such as lithium, cobalt, and nickel raises questions about supply chain security, ethical sourcing, and environmental impact (Koroma et al., 2022). As countries strive to secure these resources, geopolitical tensions and trade restrictions further complicate the global supply chain. Another critical barrier is the persistent gap in charging infrastructure. While some regions have made significant progress, many areas still lack adequate charging stations, particularly in rural and developing regions, hindering widespread adoption (Morales, 2023). Additionally, manufacturing costs continue to pose a challenge. Although battery prices have declined in recent years, the high initial costs associated with EV production remain an obstacle to affordability for many consumers (Nykvist & Nilsson, 2015). Lastly, the transition to EV manufacturing is reshaping the labor market. Digitalization and automation are transforming traditional automotive jobs, necessitating large-scale workforce reskilling programs to equip workers with the skills required for battery technology, software integration, and smart manufacturing processes (Shim & Steers, 2012).

c) The Role of Policies in EV Expansion

Government policies play a pivotal role in shaping the future of EV adoption by influencing market dynamics and fostering industrial growth. China’s industrial policies have focused on prioritizing state-backed manufacturing and securing dominance in the EV supply chain, enabling the country to lead in battery production and EV exports (IEA, 2024; World Bank, 2022). Meanwhile, the United States and the European Union have implemented strategic policies centered on subsidies and trade regulations to bolster domestic production and reduce reliance on foreign suppliers. Measures such as the Inflation Reduction Act in the U.S. and the European Green Deal have been instrumental in promoting sustainability by encouraging investments in green technology, battery recycling, and renewable energy integration (El Economista, 2023). These policies are not only driving industrial transformation but also redefining competition within the global automotive market, as governments seek to balance economic growth with environmental responsibility.

Theoretical and Practical Implications

a) Theoretical Contributions

This study contributes to the growing body of literature on the impact of technological innovation and policy-driven industrial shifts in the automotive sector. By examining the influence of battery advancements, infrastructure expansion, and vehicle connectivity, the study highlights how these factors are reshaping industry structures (Tarascon & Armand, 2001; Helmers & Marx, 2012). Additionally, the research explores the role of governmental policies in fostering industrial competitiveness, particularly through strategic interventions like subsidies, tariffs, and green investment initiatives (IEA, 2024; World Bank, 2022). A key contribution is the analysis of global supply chain resilience and how geopolitical dynamics influence the procurement of critical raw materials for EV production (Koroma et al., 2022). These insights provide a broader understanding of how economic and regulatory mechanisms interact to drive innovation and sustainability in the transportation sector.

b) Practical Implications

From a practical standpoint, the findings suggest several strategic considerations for automakers, policymakers, and industry stakeholders. First, manufacturers must prioritize the integration of digitalization and sustainable supply chain management to mitigate dependency on geographically concentrated resources (Mordor Intelligence, 2024). Second, infrastructure investments must be accelerated, particularly in regions with underdeveloped charging networks, to facilitate wider EV adoption and enhance consumer confidence (Iberdrola, 2023; Arrow, 2022). Additionally, workforce transition remains critical, as the shift to EV manufacturing requires specialized skills in battery technology, software engineering, and AI-driven systems (Shim & Steers, 2012). Governments and corporations must collaborate on training initiatives to equip workers with the expertise needed to navigate these changes. Lastly, sustainability remains a priority, with policymakers needing to enforce battery recycling programs and second-life applications to ensure the long-term viability of the EV industry (Ferreira & Sucre, 2024). These practical recommendations offer a framework for stakeholders to successfully adapt to the evolving landscape of electromobility.

Conclusions

The EV transition is reshaping global automotive landscapes, requiring a combination of technological innovation, policy support, and industry adaptation. Overcoming supply chain constraints, infrastructure challenges, and workforce transformation will be critical in ensuring a sustainable and competitive future for EVs.

Acknowledgments

We acknowledge funding from the DGAPA-PAPIIT Program at UNAM through project IN305525 "Impact of Electromobility on the Auto Parts Sector: Opportunities and Challenges."