Home » Why One Of The Least Developed Countries In The World Is Going Crazy For Electric Cars

Why One Of The Least Developed Countries In The World Is Going Crazy For Electric Cars

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A common concern when it comes to electrification is how electric vehicles will work in countries with less-developed electrical grids. Nepal, nestled against the Himalayas, is considered to be one of the least developed countries in the world. Yet, EV sales are booming in the country. What’s going on is fascinating.

Can we be hopeful today? Let’s be a little hopeful. Let’s celebrate life. May car sales were about as good as they’ve been in the last year as leasing makes a comeback. Is this a blip or are people finally, begrudgingly coming off the sidelines?

Vidframe Min Top
Vidframe Min Bottom

Japanese banks are starting to unwind their cross-held shares, especially in Toyota. This is a good thing for smaller investors and consumers. And, finally, we’re gonna celebrate the life of Parnelli Jones, an amazing driver and one tough sumbitch.

Nepal Is A Best Case Scenario For Electrification

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Image: Marc Gatland

Earlier this year we ran a story from a Tesla owner who drove through Nepal, the developing country wedged in between Tibet/China to the north along the Himalayan mountains and India to the south. A mountainous country that qualifies for “least developed” status from the United Nations seems like an unlikely place for electric cars to take off.

There are numerous studies pointing to issues that developing countries have with regard to electrifying their fleets, and about 95% of electric vehicle sales are concentrated in China, Europe, and the United States.

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Nepal, a relatively poor and landlocked country with few accessible petroleum resources, would seemingly be a worst-case scenario for EVs. In addition to having Mt. Everest, Nepal is home to incredibly poor air. The World Health Organization says that the air quality in Nepal is 4.9 times worse than what is considered safe, and the WHO also estimates that air pollution is the leading risk factor death or disability in the country.

And, yet, electric cars are selling at a fast clip, recently accounting for one-third of sales in the country (as estimated by value). How?

This is where painting all nations with a single broad brush fails to capture local realities. While the cold and remote mountainous regions of the country might not be ideal for owning a Tesla, the country’s largest population center is the Kathmandu Valley, which has a temperate climate and high population density.

The topography is a boon when it comes to temperatures being ideal for electric cars, but the flip side is that it’s a trap for air pollution from combustion-powered vehicles. The natural geography of the country does provide one big aid when it comes to electrification, as the Associated Press reports:

Nearly all of the electricity produced in Nepal is clean energy, most of it generated by river-fed hydro-electricity. Thanks to that abundant source of power, the country is quickly expanding charging networks and imports of EVs have doubled in each of the past two years, according to customs data.

Nepal has rapidly expanded its hydroelectric power generation capability and extended the grid to more communities, reducing the need for the imported oil it mostly relies on for fueling its fleets. The country is also using import duties to make EVs more attractive, lowering them from 25%-90%, compared to 276% to 329% on traditional ICE vehicles.

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EV enthusiasts also include drivers of small public vans who make their living ferrying passengers around the city and beyond.

“It is very easy to drive, there is no pollution, and it’s good for the environment. Not only that, it’s good for the country as the nation’s money does not go to foreign land to buy oil. There are benefits all round,” said Bhakta Kumar Gupta, who has drives people from Kathmandu to southern Nepal and back every day.

Given where it’s located, the market is currently dominated by China’s BYD and India’s Tata.

May Sees SAAR Above 16 Million

Galpin Land

The seasonally adjusted annual rate (SAAR) is the best rolling measure of car sales as it adjusts for, well, seasonality. I put my marker down for car sales of 16 million in 2024 and the market has been slightly under that pace for most of the year.

Thankfully for me, May was a little better and SAAR crested above 16 million to 16.08 million, which we’ll just round up to 16.1 million. What’s going on? Obviously, an increase in inventory has resulted in an increase in incentives and more flexible financing from automakers is helping.

Another big factor, as Automotive News points out in its market wrap-up, is that we’re three years out from when the supply chain crisis hit, so there are still a bunch of active leases that are coming to maturity (though that’s going away).

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But I want to focus on this quote from Edmunds analyst/pal Jessica Caldwell:

“What we’re seeing is trade-ins that are older than they have been for the last two years, which means that consumers are getting to the point where they have to come in and bring in their cars on trade,” said Jessica Caldwell, director of insights at Edmunds. “I think people are realizing that it doesn’t look like [affordability] is going to magically get better in two months’ time, so if they’ve got good credit and can afford a new car, they’re ready to buy.”

Even with the average age of cars increasing, most people aren’t going to hold onto their daily drivers forever. This also hits home as I’m kind of in this space. I’ve got good credit, I can afford a new car, and I’m obviously over my current car as little stuff starts to lose functionality.

I was expecting to hold onto my daily driver for a couple more years because it’s nice to not have a car payment, but my Forester still has a decent amount of its original value and I think I can get a good price for it. Also, I know a guy who sells cars, so I think I can get a deal. Plus, I have a big service and a new two-year registration coming up, so I can save $500-800 just by selling now.

Next month we get sales data from the automakers reporting only on a quarterly basis, so we’ll see where we are halfway through the year.

Japanese Banks Unwinding Cross-Held Shares In Toyota

Akio Toyoda Honored 600x391
Photo: Toyota

Here’s a fun bit of economic history. Post-war Japan created enormous value through giant successful companies like Toyota, Sony, Panasonic, and Studio Ghibli. Not all of this value creation was captured by small investors as Japanese companies, and especially banks, engaged in a process of cross-holding shares.

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This means that if big bank Sumitomo Mitsui does business with Toyota, then Toyota will buy some shares in Sumitomo Mitsui and Sumitomo Mitsui will hold shares in Toyota, which also holds shares in its supplier DENSO, which also holds shares in Toyota.

There are a lot of reasons why cross-holding shares is a bad idea, as it elevates a small group of executives above regular investors and makes it harder to hold them accountable, which is bad for corporate governance. Cross-held shares have also led to price-fixing, which is bad for consumers.

The Japanese government has pushed hard to end this practice, resulting in the announcement this week that massive banks Mitsubishi and Sumitomo Mitsui divesting about $8.5 billion in Toyota stock. They aren’t the only ones. That DENSO thing wasn’t really hypothetical:

Toyota is also unwinding cross-shareholdings within its network of manufacturing partners. In November, the carmaker announced plans to lower its stake in electric parts maker Denso Corp. to 20% from 24%. Prior to that, Toyota committed to selling some of its stake in telecommunications company KDDI Corp. for ¥250 billion. While the sales serve the purpose of freeing up money that can be used to fund Toyota’s shift to electric vehicles, they also be used toward buybacks.

The unwinding of cross-shareholdings “means gradually turning them into viable assets,” Masahiro Yamamoto, chief officer of Toyota’s accounting group, said at the company’s results briefing in May.

Unsurprisingly, the Nikkei has done quite well since cross-held shares have started to go away.

RIP Parnelli Jones

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I was sad to hear of the passing of the legendary racer Parnelli Jones earlier this week. If you watched pretty much any kind of racing in the second half of the 20th century in the United States then you’ve heard his name.

There are some racers who are specialists and become famous for winning often at one kind of racing. Then there are drivers like Parnelli Jones, who managed to win in just about everything he drove. Jones nearly won the Indy 500 on his first try and then won a couple more as a driver, followed by wins as a team owner. He won a bunch of NASCAR races, was Trans-Am Champion during the most competitive classic years of that series, won his class at Pikes Peak, and also won the Baja 1000 twice.

I love this quote captured in the New York Times obit:

Jones was once asked if there had ever been anyone better than him.

“I don’t think so,” he told Car and Driver magazine in 2013. “You can teach somebody how to drive, but you can’t teach them that will and desire and kick-butt attitude.”

RIP to a real one.

What I’m Listening To While Writing TMD

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You know it was coming. The new Charli xcx album is out and it’s a big departure from her last album, “Crash.” It’s a bit more Sophie, a bit more hyperpop, a little smaller, and a little faster. AG Cook is back. I’m digging it.

The Big Question

Who is the GOAT when it comes to racing? Who is the best to ever do it?

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Myk El
Myk El
16 days ago

I’m partial to John Surtees just because of championships on 2 wheels and 4 wheels. Mind you there are a lot of very good drivers referenced here in the comments and you could probably talk me into a couple of others.

EXL500
EXL500
16 days ago

GOAT: Lewis Hamilton, most of everything in the most prestigious series.

Sc00t3r
Sc00t3r
16 days ago

Who is the GOAT when it comes to racing? “Doc” a.k.a. Hudson Hornet: 3 Piston Cups and 27 wins in a single season. 😉

Wolfpack57
Wolfpack57
16 days ago
Reply to  Sc00t3r

But Strip Weathers has 7 Piston cups and a 37 year career of competition.
https://www.youtube.com/watch?v=zOf3FZdtb-g

Sc00t3r
Sc00t3r
16 days ago
Reply to  Wolfpack57

You got me there!

Arch Duke Maxyenko
Arch Duke Maxyenko
16 days ago

GOAT of driving? Sebastian Loeb is definitely up there, as is Jim Clark, Mario Andretti, Parnelli, Mark Donohue, Dan Gurney, Fangio, Walter Röhrl

Arthur Flax
Arthur Flax
15 days ago

GOAT? A.J. Foyt. Winner of Four Indy 500s, LeMans, Daytona 500 and 1983 Daytona 24 Hours where he hopped in the car and co-driver Bob Wollek said, “He doesn’t know the car, he doesn’t know the rain, he doesn’t know anything…” After which A.J. was fastest in the wet.

But Rufus, Parnelli Jones was pretty darn good. RIP.

Davedave
Davedave
15 days ago
Reply to  Arthur Flax

Foyt? Is this some in-joke I’m not getting, or do people in the US genuinely think the Indy 500 is that big a deal in motorsports? I think most people round the world would rank an Indy 500 win as roughly equivalent to a single F1 race win, and consider that to be generous to the Indy, at least in the last few decades.

In terms of GOAT, Foyt’s sole qualification is one Le Mans win in a year when the only finishers in the top class were his car and another from the same team which had enough mechanical problems to finish 30 laps back.

For some comparison, Tom Kristensen has 9 Le Mans wins – though I doubt many people would put him forward as the GOAT in all-round terms. Jacky Ickx has six, as well as plenty of other titles in other forms of the sport, including a Paris-Dakar, Bathurst 1000, touring cars, Can Am, and a bunch of F1 wins (though he was only ever runner-up in the drivers’ championship).

Frankencamry
Frankencamry
16 days ago

One of our developers is from the outskirts of Kathmandu. I haven’t talked to him a lot, but basic discussion of the changes there are a lot like what the “developed” world experienced in the last hundred years, compressed.

When he was a little kid his house had a dirt floor and they borrowed their neighbors yak if they needed to use a cart. Last time he went home his parents had a car (not sure if EV) and internet good enough to work remotely on.

He’s in his 30s. I can’t fathom that much change that rapidly.

Urban Runabout
Urban Runabout
16 days ago
Reply to  Frankencamry

What will all those poor unemployed Yaks do now?

Cheap Bastard
Cheap Bastard
16 days ago
Reply to  Urban Runabout

Mmm yak…..

Fred Flintstone
Fred Flintstone
15 days ago
Reply to  Urban Runabout

Yaks?…. What about the Yak shit shovellers?

Sammy B
Sammy B
16 days ago
Reply to  Frankencamry

India saw a somewhat similar compression. Telephones went from luxuries in the early 90s and then jumped to every single person had a cell phone. Sort of popped right over getting a landline in every house. From the late 90s to today you went from a handful of car models available (Ambassador still pretty much every where) to Audis and a whole host of manufacturers and models available.

Certainly not the same as jumping from dirt floors to EVs, but it’s crazy to think how much change some folks have seen in such a short period.

IanGTCS
IanGTCS
16 days ago
Reply to  Sammy B

Lots of the developing world went from landlines being only in businesses and the elite to everyone having a cellphone in what seems like no time. I worked in a remote area of Mali from 2007 to 2012 and the growth I saw was amazing. First got there and there were cell phones in the cities and watched more and more towns get towers. Basic candybar phones with a flashlight and radio were in everyones pocket and I believe people could do some banking with them too. So much easier to build 1 tower and serve a town.

Some towns had big signs with “electrified since 20XX”.

Fuzzyweis
Fuzzyweis
16 days ago

The quicker adoption of EVs in countries with poor electrical infrastructure may also be due to said poor electrical infrastructure, especially if the EVs have the built in inverter to provide household power.

Think of it like going to the community well for water to bring back to their house, they get an EV and fill it up with electricity, then bring it back to the house and now don’t have to worry about rolling blackouts or what not.

So look for more EV adoption in those 3rd world places without reliable power, like Nepal or Brazil or Texas.

Parsko
Parsko
16 days ago
Reply to  Fuzzyweis

I just spit took my hamburger onto my screen, thanks.

Cheap Bastard
Cheap Bastard
16 days ago
Reply to  Fuzzyweis

Nah. The Texas solution is to power the porchlight with a coal spewing 4,,000 HP 3 Gal/kWh duelly rolling on a dynometer.

Carlos Ferreira
Carlos Ferreira
15 days ago
Reply to  Fuzzyweis

Brazil is not a 3rd world country in the least, only their politics are. Wait, so are ours!

Defenestrator
Defenestrator
8 days ago
Reply to  Fuzzyweis

Easier to fill them up, too. Importing gasoline as a landlocked country with no real oil reserves is harder than tossing up a few solar panels.

Urban Runabout
Urban Runabout
16 days ago

Seems to me that a mountainous country that has few natural resources worth burning and minimal infrastructure (ie: No gas stations”) would be the perfect place for EVs.

Because solar panels, wind turbines and electrical wires are far easier to string up and deliver power than driving and pouring tanker-trucks of fuel into local storage tanks (that still need electricity to operate) for sale.

Vic Vinegar
Vic Vinegar
16 days ago
Reply to  Urban Runabout

Right. The people that can afford a car already have access to electricity. Nevermind that it is cheaper than importing gasoline/diesel. Maybe you don’t have a fancy fast charger, but you can still plug it in. There is no Sheetz on every corner, so this is probably way more attractive to anyone looking at a car.

Drive By Commenter
Drive By Commenter
16 days ago

Anecdotally, people around me seem to be buying newer cars. I sure fit the profile of getting off the sidelines and replacing an older daily driver. But it needs some work to get ready to sell. Not much but I’m finding I don’t have the time and/or health right now to do it. Hopefully something new with a warranty will not need as much work. Fingers crossed.

Stryker_T
Stryker_T
16 days ago

We just got my mom a new car, and it was only because the one she had was almost 15yrs old now and she was ready for something more comfortable and better mileage.

wanted a hybrid, but she also wanted it to be a small hatchback like the old car, there wasn’t much that fit anymore because everything is going SUV, she did end up really liking the corolla hatch, so that’s what we ended up getting.

Last edited 16 days ago by Stryker_T
Citrus
Citrus
16 days ago
Reply to  Stryker_T

It sucks that the Corolla hatch is pretty much the only thing that hits her requirements because I have similar taste and also don’t fit in Toyotas.

Stryker_T
Stryker_T
16 days ago
Reply to  Citrus

wait, I didn’t mean fit as in she didn’t fit in the car, but fit the requirements she wanted? lol

Last edited 16 days ago by Stryker_T
Citrus
Citrus
16 days ago
Reply to  Stryker_T

No, I understand what you meant. I have similar requirements – small hatchback, as efficient as possible – but I have the additional problem that I physically do not fit in Toyotas.

I shouldn’t post first thing in morning, I can see the confusion.

Carbon Fiber Sasquatch
Carbon Fiber Sasquatch
16 days ago

Parnelli Jones was always one of my favorite drivers. Champions often get complacent but he always went looking for the next challenge. It was that fire and tenacity that set him apart. He will be greatly missed.

Michael Beranek
Michael Beranek
16 days ago

Racing GOATs
F1- Senna, duh
Indy- Given what he’s accomplished, and that he’s still going strong, gotta go with Dixon.
NASCAR- Earnhardt, all day, every day.

Masters of all disciplines-
Jones is in this conversation. But I think Gurney and Andretti (the elder) were better all-arounders.
Given his success in USAC, Indy, NASCAR, and now NHRA, a case could certainly be made that Tony Stewart is the new GOAT. He’s fast in anything.

Sammy B
Sammy B
16 days ago

Stewart is definitely up there. I think lack of F1 and only having success in the IRL as opposed to CART may hurt him a tad in the conversation. He’s been the most successful as a team owner/businessman for sure. Don’t mean to cut him down at all, just offering my 2 cents as well.

Michael Beranek
Michael Beranek
16 days ago
Reply to  Sammy B
No doubt that "IRL" is not what you'd call a resume-builder. But he dominated Silver Crown and did quite well in NASCAR despite racing against Gordon, Johnson, Martin, and the Busch Brothers. 
Michael Beranek
Michael Beranek
16 days ago

Why did my comment post in a weird font?

Space
Space
14 days ago

I kinda liked it. Did you ever figure out how you did it?

Michael Beranek
Michael Beranek
14 days ago
Reply to  Space

I may have highlighted the whole text box while trying to select just a few words

Sammy B
Sammy B
15 days ago

yah for sure. no knock at all for his sprint car and NASCAR achievements

Manwich Sandwich
Manwich Sandwich
16 days ago

with few accessible petroleum resources, would seemingly be a worst-case scenario for EVs. In addition to having Mt. Everest, Nepal is home to incredibly poor air. “

I’d say the two factors of expensive fuel and poor air quality would make a BEST CASE scenario for pushing a place or country to adopt BEVs, not a worst case.

Mechjaz
Mechjaz
16 days ago

I was gonna say, that’s about as strong as argument for EVs as it gets.

Michael Beranek
Michael Beranek
16 days ago

Plus, not contributing to the melting of the glaciers that keep a couple of billion people alive. That might be important too.

EVDesigner
EVDesigner
16 days ago

This is obviously terrible assumption to make from my side, but I assume Nepal has a lot of mountains and high elevation areas. EV’s dont suffer from oxygen starvation like ICEs do and that makes a huge difference. Having regen braking would also save people from replacing their brakes.

RC
RC
16 days ago
Reply to  EVDesigner

Yep. Turbo ICE vehicles have sorta rendered altitude-related concerns less relevant, but if you routinely travel about 6 or 8k, you’re getting less than a 2/3 of your rated power. So your 180HP car might be closer to 100HP.

In addition to which, EV is much friendlier to distributed infrastructure. Bringing in a tanker full of gas on crappy roads is an expensive proposition, but bringing in 5 400w solar panels is enough to provide about 16kwh of power per day, or about 30-50 miles of range (depending on the EV), perpetually, per day. Hauling in about 500 pounds of stuff gives you the ability to run your EV every day for several years.

Which brings up another point. In the US, EV’s are synonymous with “Advanced technology” and “Very expensive.” Which is part of the reason their adoption has lagged – people who just need an A-to-B appliance and don’t want to deal with the inherent lesser reliability and increased repair expense are still going to go ICE. China, on the other hand, has vast arrays of inexpensive EV’s that suit the “driving appliance” use case quite handily. So while repairing a Tesla at home in the US is not going to fly, there’s plenty of Chinese vehicles that use COTS components and can be repaired in a garage.

Last edited 16 days ago by RC
Cheap Bastard
Cheap Bastard
16 days ago

“I’d say the two factors of expensive fuel and poor air quality would make a BEST CASE scenario for pushing a place or country to adopt BEVs, not a worst case.”

Coupled with abundant 24/7/365 hydropower and being right next to China and its oversupply of EVs and willingness to dump them.

Ranwhenparked
Ranwhenparked
16 days ago

Especially the bit about abundant hydroelectric power, energy independence FTW

Canopysaurus
Canopysaurus
16 days ago

Good thing his parents didn’t name him Whoanelli Jones. RIP, wheel man.

Geoff Buchholz
Geoff Buchholz
16 days ago

I think I’m going to Kathmandu …

Paul E
Paul E
16 days ago
Reply to  Geoff Buchholz

That’s really, really where I’m going to…

Geoff Buchholz
Geoff Buchholz
15 days ago
Reply to  Paul E

Tell me you’re from Michigan without saying you’re from Michigan.

Paul E
Paul E
15 days ago
Reply to  Geoff Buchholz

I’m not, but it was pretty impossible to escape Bob Segar on 1970s and 1980s (and even now on “classic rock”) rock radio.

Michael Beranek
Michael Beranek
16 days ago
Reply to  Geoff Buchholz

Pulling into Kathmandu
Smoke rings fill the air
Perfumed by a Nepal night
The Express gets you there

TOSSABL
TOSSABL
16 days ago

Thank you

(My first album)

Last edited 16 days ago by TOSSABL
Michael Beranek
Michael Beranek
16 days ago
Reply to  TOSSABL

Aw, man, it just played in my head and I realized how cringey that melody Peart plays near the beginning is.

TOSSABL
TOSSABL
16 days ago

Yeah. My absolute favorite album for many years, but I played the whole thing a while back and was really glad I didn’t get that circle&star tattoo back in the 80s.

Granted I’ll probably still know all the words when I can’t even remember my name

Michael Beranek
Michael Beranek
14 days ago
Reply to  TOSSABL

I still know every word of 2112.

V10omous
V10omous
16 days ago

Living in a mountainous country would bias me *toward* owning an EV, not the opposite, as there’s no altitude effects.

Cryptoenologist
Cryptoenologist
16 days ago
Reply to  V10omous

In addition, regenerative braking makes the frequent up and down hill switches much more efficient, since you get back 70% of the potential energy.

Root
Root
16 days ago

I really enjoyed the fact that on a trip last summer my PHEV’s battery was at 8% at the Eisenhower tunnel on I-70 and it was over 60% by the time we got to Denver. What would have been wasted heat with friction brakes became extra miles thanks to regen.

Ranwhenparked
Ranwhenparked
16 days ago
Reply to  V10omous

Also, the state of the road network and the isolated valleys probably makes long distance road trips out of town an unattractive hassle regardless of what vehicle you own, so range concerns are less of an issue (similar to the early days of cars in this country, you weren’t going to drive from New York to Boston anyway in 1902, so what did it matter if your Baker had the range to do it or not?)

Mechjaz
Mechjaz
16 days ago
Reply to  V10omous

Nothing to do with anything, but I saw an SRT-10 the other night and giggled. My brother and daughter did not seem sufficiently impressed when I told them it had the engine from a Viper. I didn’t realize there were quad cabs! I always picture it as a single cab with a short bed.

Edit: in yellow, always yellow

Last edited 16 days ago by Mechjaz
V10omous
V10omous
16 days ago
Reply to  Mechjaz

To be fair, 500 hp trucks don’t hit the same way now as they did 20 years ago, but I’m impressed either way.

TOSSABL
TOSSABL
16 days ago
Reply to  V10omous

Yeah, 500hp isn’t noteworthy these days—but a V10 always makes me smile

V10omous
V10omous
16 days ago
Reply to  TOSSABL

This is the way.

Ben Siegel
Ben Siegel
16 days ago
Reply to  Mechjaz

Gen 1 (or the first few MYs?) were single bed short cab, and came with a manual (at least option?). The Gen 2s (or later years) were quad cabs and all automatics.

Knowonelse
Knowonelse
16 days ago
Reply to  V10omous

I live in the California foothills, and when I was in the Reno area (Virginia City actually) I was really surpised when I checked the MPG my my Prius when I go home. I got about 70 MPG for the round trip. Having to go up and over the I80 pass I wasn’t expecting that.

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