Back in 2017, Dyson, the company best known for its expensive vacuum cleaners and hairdryers announced that it was developing its own range of electric cars. The Dyson electric cars, which would capitalize on the company's expertise with smaller electric motors found in the Dyson vacuum cleaners, were due to arrive in 2021, along with Dyson’s very own range of solid-state batteries to power the vehicle.

2 years later, the 2 billion-pound (RM10.7 billion) plan to branch out and take on the likes of Tesla Inc. and Volkswagen AG is now officially abandoned.

The reason it was even conceivable for Dyson to make an electric car may also have been why its project was doomed to fail: electric cars are simply too easy to make. There is an increasing glut of electric carmakers led by Tesla, among them Lucid Motors Inc., Byton Ltd. and China’s NIO Inc, which has benefited from the lowered barriers of entry into the electric automotive market. Whereas cars with a combustion engine need about 30,000 components, an electric vehicle needs just 11,000 parts.

Despite the ongoing development of what he referred to as "a fantastic car," James Dyson, the founder of the company wrote in an email to all his staff that “we have tried very hard throughout the development process, we simply can no longer see a way to make it commercially viable."

This difficulty will come as no surprise; because although Tesla has managed to establish itself as a car company, it's had a harder time making money selling those it’s electric vehicles. In contrast, Dyson would have needed a faster return on its investment than the established carmakers to keep the project going. The small size of the electric car market now would make it very difficult for them to continue on the project. Just 575,000 electric vehicles were sold globally in the three months through June 2019. That’s 3.7% of the overall automotive market.

Dyson is not alone in their quest to develop electric cars; often seen as a future alternative to the traditional cars with combustion engines. Volkswagen alone has announced plans to invest $52 billion in electrification as it targets production of at least 2 million electric vehicles a year by 2025. However, Volkswagen can rely on its status as an established carmaker to cover up for the sales, boasting of an existing network of dealerships in 153 countries which will make it considerably easier to sell those cars.

Another reason for Dyson pulling out of the electric car market is probably the fact that launching any new vehicle requires a great deal of investment into R&D. Launching a new car when you lack a supply chain or sales network is even harder. Car companies remain one of the most difficult markets to break into, even for an already-successful firm. Despite this, Dyson will not be wasting their years of research and development, but rather, reuse their resources into other areas of their company.

"We will concentrate on the formidable task of manufacturing solid-state batteries and other fundamental technologies which we have identified: sensing technologies, vision systems, robotics, machine learning, and AI offer us significant opportunities which we must grab with both hands," Dyson wrote.

Given the unstable electric car market at the moment, Dyson’s retreat looks-wise. A failure at a later date would have been much more painful, and potentially ruinous for the company.

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Why Dyson Killed Its Planned Electric Car