Your one and only question is the following: what do electric vehicles and plant-based burgers have in common?
The answer: they’re both getting better the whole time. As improvements to these products occur, so adoption levels should increase. This intriguing analogy was made to us by the Chief Executive of Meatless Farm, Morten Toft Bech, in a recent conversation your author had with him. We concur. There are miles to run (no pun intended) with regard to both these future trends.
Begin with electric vehicles (or EVs) and it’s great news that there are now over 10m of them on the world’s roads compared to just 17,000 at the start of the century (per the World Economic Forum). But why aren’t there more? Many would contend that it’s only a matter of time, given that most developed world governments have announced plans to phase out the sale of new petrol and diesel vehicles within the next 20 years. However, exactly when consumers will make the transition remains to be seen. A recent US survey found although two-thirds of Americans believe electric vehicles to be good for the environment, a similar percentage are reluctant to buy one owing to concerns over cost. 34% also cited potential lack of reliability as a concern. Another UK study found that the most common reason given for not buying an electric vehicle related to a lack of fast charging points (cited by 37% of respondents), followed by range (35%) and cost (33%).
Looking ahead, we expect both vehicle prices to fall, and infrastructure to improve. By way of progress already achieved, consider that the price of lithium-ion batteries has declined by 97% since 1991. This matters, since the battery is an EV’s largest cost component. As they come down further, some projections suggest that EVs could cost the same as gas-powered cars by 2023. Similarly, the density of charging infrastructure has improved massively (by an estimated seven times in the last five years, per the IEA) and many countries around the world, from China to the Netherlands, have committed to substantial build-out plans. There is much more still to be done, particularly in the US, where charging density is markedly lower than in Europe or Asia.
Turning to plant-based meat alternatives, walk into any decent supermarket and you will see just what an established presence they have become. Almost all fast-food chains will also now likely feature at least one plant-based option. However, most studies suggest that the current value of the plant-based meat market is just 1% of the total meat market. Furthermore, if consumers have a bad experience with a novel product in this category, it may take them 12-18 months before they revisit again, according to the CEO of Meatless. What needs to change? “We have to get closer to meat” is the answer provider by Morten. Innovation means product quality (think both taste and texture) is constantly improving. Larger volumes and scale efficiencies should see the price gap between meat and plant-based options narrow over time. We will be revisiting this topic in much more detail later in the year.
The Future Trends Blog is taking a summer break next week and will return at the start of August.
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