After years of overestimating the market, it seems that EV adoption has finally started to take off, and the market is accelerating faster than ever.
The market has had many starts and stops over the years, each time it looked like we had reached an inflection point things were reeled back in. However a confluence of events has emerged that has the EV market moving faster than ever.
Analysts Keep Upping Their Projections
It used to be that analysts took a cautionary position when it came to EVs, especially as lofty projections of the past were consistently missed. Now thats changed with two new reports from Bloomberg and the International Energy Agency (IEA). Bloomberg's new energy analysis states that EVs will make up 54% of all new vehicle sales by 2040 and over a third of all vehicles on the road will be an EV. IEA then followed suit and has recently doubled their expected growth rate of EVs from 60 million to nearly 125 million EVs worldwide by 2030.
Global electric vehicle sales:
1st million: ~20 years
2nd million: 18 months
3rd million: 8 months
As Bloomberg's Colin Mckerracher pointed out that while it took nearly 20 years for the world to hit one million EVs it took a mere two years to reach three million and adoption is only increasing. As more EV models become available and prices continue to drop more and more consumers will opt for an electric over a traditional gas vehicle.
Large Automakers Are Taking EVs Seriously
Only a few years ago the only real player in the EV world was Tesla and with the starting price of a Model S in the $75k range it looked like EVs may never take off. However, as Tesla slowly ate into luxury automotive sales the other large automakers started to take notice. Today more than 75 plug-in electric vehicle models available in the US, 22 of which are all-electric.
In two years most large automakers have committed to building at least one all new line of electric vehicles with GM going so far as offering up to 20 by 2023. Now that the load isn't solely shouldered by Tesla consumers have far more choice afforded to them. Further as time goes on the used EV market has developed and great deals can be found on older model EVs.
China is Driving Change
If there was any indicator that EVs were here to stay, it was when the Chinese auto market, the world's largest, began rapidly switching over to electric vehicles and not just personal cars. Just this year Schenzhen, China converted all 16,000 of its city buses to electric. For some context thats bigger than New York’s, Los Angeles’s, New Jersey’s, Chicago’s and Toronto’s electric bus fleets combined.
Just last year China became the first nation to sell more than one million EVs in a year and is on track to double that this year. Its also projected that China will control 50% of the electric vehicle market until 2025 and nearly a quarter of the cars on the road will be EVs at that time as well. While the world market will catch up China will control the market for decades to come.