The International Energy Agency predicts that global electric vehicle sales will increase by more than 20% to reach 17 million this year, with China leading the way. The surge in demand for EVs is expected to reshape the global auto industry and reduce oil consumption for road transport significantly. The IEA projects that by 2035, half of all cars sold worldwide will be electric, provided that charging infrastructure keeps up with the pace of adoption.
Despite facing financial pressures such as price wars and declining sales, automakers are crucial to increasing the uptake of EVs globally. The affordability of EVs will play a significant role in the transition, with more than 60% of EVs sold in China last year being less expensive than conventional cars. Market competition and advancements in battery technology are expected to drive down EV prices in the coming years, particularly with growing electric car exports from Chinese automakers.
China is at the forefront of the EV market, with over 60% of global EV sales expected to come from the country this year. By 2030, almost one in three cars on the roads in China is projected to be electric, compared to one in five in both the United States and the European Union. This shift towards electric vehicles will have major implications for both the auto industry and the energy sector, according to the IEA.
The IEA warns that the increase in demand for electricity from EV charging points could strain electricity grids if not carefully planned and supported by government policies. Currently, the number of public EV charging points worldwide is expected to reach 15 million by the end of the decade, a significant increase from last year. Policy support will be essential to ensure that the growth in EV adoption does not overwhelm the infrastructure.
Recent price cuts by major automakers like Tesla and Li Auto in response to competition and slowing sales highlight the challenges faced by the industry. While the global EV market continues to grow, automakers are feeling the pressure to adapt to market conditions and drive down prices to make EVs more accessible to consumers. The IEA’s bullish outlook for EVs underscores the potential for significant growth in the sector in the coming years, with electric cars poised to play a crucial role in reducing emissions and decreasing reliance on traditional vehicles.
