Dyson’s recent announcement that it is scrapping its electric vehicle project is yet another indicator of hard times for EV startups. However, given the context, it is not a complete surprise. Time will almost certainly prove that it was a wise decision for Dyson, a firm renowned for its high-tech vacuum cleaners, hand driers and air conditioners, to have pulled the plug at this early stage, rather than continue haemorrhaging cash in the race to electrification.

On the face of it, the EV market would seem a strong growth segment that any company would want to enter. Although pure battery electric vehicles will only account for around 2.5% of global sales in 2019, analysis by the business intelligence unit at Automotive from Ultima Media shows that EVs are expected to grow at over 20% a year for the next decade and reach 15% of global sales by 2030, reaching close to 19m units.

However, manufacturers face an undeveloped and unstable market. EV sales have risen mostly in regions like the EU and China because of regulations aimed at reducing emissions, rather than consumer interest. OEMs also face supply chains and production that have not yet achieved economies of scale.