The thing is, its expensive to make EV. Most manufacturers make negative money when they sell them, or at least don't have good margin.

Also, the amount of battery capacity that currently exists is nowhere near where it needs to be. Most manufactures now try to expand and secure supply, but supply growth is simply not growing fast enough for large companies to switch to EV fast.

Tesla doesn't have a smaller car because even for them making a smaller car would mean that compared to other smaller cars it would be massively expensive. They have to further improve cost to be able to make a competitive small car. ICE industry had 100+ years to reach the scale it has.