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CEO of a automotive seller on the explanations for the reluctance to purchase electrical autos

A place to charge electric vehicles in London, UK

Keith Mayhew / SOPA Pictures | LightRakete | Getty Images

The CEO of the major automotive retailer Pendragon has recognized the challenges facing the electric vehicle sector, but expects adoption rates to increase in the future.

Speaking to CNBC’s Squawk Box Europe, Bill Berman said on Wednesday that powertrains need to change, describing himself as “a huge fan of electric vehicles”.

“I’m also a big fan of hydrogen – I think it plays a role and I think it will get a little stronger in the years to come,” he said. “People’s reluctance … toward electrics is manifold,” he added.

“First of all, it’s unknown – no one has ever driven an electric car, so there is a lot of uncertainty associated with it,” Berman said, alluding to the fact that many people have not yet been put behind the wheel of an electric vehicle.

“Most consumers cite range anxiety. Although … most consumers drive less than 50 miles a day, knowing that they can’t just fill up with your vehicle creates hesitation.”

Range anxiety refers to the idea that electric vehicles cannot make long journeys without running out of charge and stranding. In order to cope with this, a sufficient charging infrastructure must be built in the coming years.

Up to this point, Berman explained how he felt there were challenges related to charging a vehicle. “Most houses don’t have electricity, and most office buildings don’t,” he said.

“It’s the proverbial ‘chicken and egg’, so to speak, but as more electric vehicles are sold and more infrastructure is built in – be it in North America, Europe or the UK – I think adoption rates will increase.

Read more about electric vehicles from CNBC Pro

As far as vehicle types are concerned, there seems to be a change. The UK, for example, has plans to move away from the internal combustion engine and develop a net-zero transport sector by 2050.

It wants to stop the sale of new diesel and gasoline cars and vans by 2030 and oblige all new cars and vans to have no tailpipe emissions from 2035.

Elsewhere, the European Commission, the executive branch of the EU, aims to reduce CO2 emissions from cars and vans by 100% by 2035.

As technology advances and environmental concerns grow, the automotive industry sees some significant changes ahead in the years to come.

In his interview with CNBC, Berman tried to paint a picture of how this might play out. “I think people will … adopt alternative modes of transport,” he said.

“I think people will choose different ways to commute and get around and different powertrains … whether electric or hydrogen.”

“At some point there will be autonomous vehicles,” he said. “And, you know, you could call a capsule that picks you up, Uber-esque and … takes you to market every day.”

Pendragon, which is headquartered in the UK and listed on the London Stock Exchange, announced on Wednesday underlying earnings before taxes of £ 35.1 million ($ 48.55 million) for the first half of the fiscal year. That compares to a loss of £ 31 million for the first half of fiscal 2020.

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