The electric vehicle (EV) boom is now expected to come five years earlier than originally anticipated, in 2033, according to new research.
Based on new Ernst & Young AI analysis for supply and demand, experts are suggesting that EV sales will surpass those of traditional vehicles by 2033, with Europe reaching this point in 2028, China by 2033, and the U.S. by 2036. The research suggests that non-EV sales could plummet to as low as 1 percent of total vehicle sales by 2045.
While Europe will be the first to achieve record EV sales, due to increasing vehicle demand China will likely lead the way through to 2050.
Pressure from governments across Europe and in China for companies to meet green policy expectations means increasing fees for car manufacturers buying and selling gasoline and diesel-powered vehicles. The goal of net-zero has spread around the globe, meaning many automakers are making the switch earlier than anticipated.
President Trump’s withdrawal from the Paris Agreement, which was re-joined by the U.S. under President Biden in January, meant the easing of fuel regulations. While the U.S. will catch up with China and Europe’s EV market, this will likely happen at a slightly later date.
“The regulatory environment from the Biden administration we view as a big contributor because he has ambitious targets,” EY’s global advanced manufacturing and mobility leader, Randy Miller, stated in an interview.
As several big car manufacturers jump on board the EV boom, we are seeing an increase in public interest in making the switch. The availability of reliable car brands now developing EV models is a shift from the Tesla-dominated market of previous years.
In addition, the millennial demographic that previously rejected car ownership for environmental reasons, as well as city living, has been influenced by the pandemic to move away from public transport and car-sharing. The potential for EV makers to tap into this environmentally-conscious market is significant.
Just as this research comes out, Volkswagen announces an expected record year for its EV sales. Relatively new to the market, VW sold almost half as many EVs as Tesla in 2020, a figure that is expected to rise substantially in 2021. WV sold 231,600 electric-powered vehicles in 2020, up from 73,600 the previous year.
Seeing the acceleration of the EV market, various cities and states around the world are now making the uptake of EVs easier through financial incentives, as governments encourage consumers to switch away from petroleum and diesel-powered cars.
Just this week, major petroleum consumer India announced plans to subsidize EV purchases to encourage making the switch, putting the country’s National Electric Mobility Plan into practice. The state of Gujarat will be giving subsidies to EV buyers and will exempt owners from vehicle registration fees.
The state’s Chief Minister explained of the move, “The EV policy announced today will be in force for four years. We want to promote EV usage as well as promote Gujarat as a destination for the production of EVs. We are aiming to cut 600,000 tons of carbon emission… every year.”
India is the fifth largest motor vehicle manufacturing country in the world, with the automotive industry contributing around 7.1 percent to India’s GDP, meaning that the creation of hubs such as these could make it a global leader in EV production.
With the EV boom coming early, it appears that major automotive brands and states around the world are working hard to get ahead of the curve to ensure their stake in the ever-expanding EV market.
By Felicity Bradstock for Oilprice.com
More Top Reads From Oilprice.com: