Electric vehicle (EV) sales are expected to reach a record high this year, according to the latest report from the IEA.
Over 14 million units are projected to be sold, accounting for 18% of the total car market. This growth is staggering considering electric cars represented only 4% of the market in 2020.
China leads the world in EV sales, accounting for 60% of global sales in 2022, followed by Europe and the United States.
Some major economies have enacted policy programs to catch up with China’s soaring production. The Fit for 55 package in the European Union and the Inflation Reduction Act in the United States are largely responsible for the uptake in EV production and demand, and are directly accountable for the increased market share for electric vehicles in their respective territories.
The worldwide shift to EVs relies almost entirely on battery production and supply chains stemming from Asia, with China dominating the battery and component trade. However, other economies are introducing policies to foster domestic industries to improve their competitiveness in the EV market as seen by GM’s recent announcement of their joint venture with Samsung. Announcements such as this have been commonplace for OEMs across US and Europe as OEMs ensure they can meet the expected level of demand for EVs for the rest of the decade.
Electric car sales are also increasing in emerging and developing economies, such as India, Indonesia, and Thailand. Two- or three-wheel vehicles are particularly popular in these regions, with over half of India’s three-wheeler registrations in 2022 being electric.
The electrification of two- or three-wheelers is important to support sustainable development in these economies. The demand for a variety of EVs signifies the importance of building an emobility ecosystem, in which multiple modes of transport, from ebikes to electric cars, buses, and trains, work in tandem to create clean, net-zero urban areas and travel routes.
When announcing the report, IEA Executive Director Fatih Birol said: “Electric vehicles are one of the driving forces in the new global energy economy that is rapidly emerging – and they are bringing about a historic transformation of the car manufacturing industry worldwide,”
“The trends we are witnessing have significant implications for global oil demand. The internal combustion engine has gone unrivalled for over a century, but electric vehicles are changing the status quo. By 2030, they will avoid the need for at least 5 million barrels a day of oil. Cars are just the first wave: electric buses and trucks will follow soon”.