Aqilah Rahman
Global electric car sales are expected to maintain a strong momentum throughout 2023. Over 2.3 million electric cars were sold in the first quarter, an increase of 25 per cent compared to the same period last year. By the end of 2023, the sales of electric cars globally are expected to reach 14 million, according to a new edition of the International Energy Agency’s (IEA) annual Global Electric Vehicle Outlook.
Over the past years, electric cars’ share of the overall car market has steadily increased from less than five per cent in 2020 to 14 per cent in 2022.
Electric cars are expected to account for 18 per cent of total car sales worldwide in 2023, based on the latest IEA projections.
“Electric vehicles (EVs) 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,” said IEA Executive Director Fatih Birol.
“The trends we are witnessing have significant implications for global oil demand. The internal combustion engine has gone unrivalled for over a century, but EVs are changing the status quo.
“By 2030, they will avoid the need for at least five million barrels a day of oil. Cars are just the first wave: electric buses and trucks will follow soon.”
Electric car sales – including battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) – exceeded 10 million in 2022. Over 26 million electric cars were on the road last year.
TOP 3 EV MARKETS
The three dominant EV markets are China, Europe and the United States (US). China is by far the biggest market, accounting for about 60 per cent of global electric car sales in 2022.
More than half of the electric cars on roads worldwide are now in China. In 2022, electric cars accounted for 29 per cent of total domestic car sales in China, surpassing its 2025 national target of a 20-per-cent sales share.
Europe is the second largest market for electric cars, accounting for 25 per cent of all electric car sales last year.
In volume terms, the biggest market in Europe is Germany (830,000) followed by the United Kingdom (370,000) and France (330,000).
The US as the third largest market reached a sales share of nearly eight per cent.
China’s growth in electric car sales has been underpinned by sustained policy support, but cheaper retail prices is also a contributing factor.
In 2022, the sales-weighted average price of a small BEV in China was below USD10,000.
Meanwhile in Europe and the US, the sales weighted average price exceeded USD30,000.
OPTIONS
SUVs and large cars are the most common electric car options in 2022, accounting for 60 per cent in China and Europe. The share is even greater in the US, accounting for over 80 per cent. According to the report, Chinese carmakers have focussed on developing smaller and more affordable models.
In comparison, carmakers in Europe and the US have mostly focussed on larger or more luxurious models.
The report added that in 2022, the US had a higher sales-weighted average range of small BEVs sold at nearly 350 kilometres (km). France, Germany and the UK recorded just under 300km, compared to under 220km in China.
TWO OR THREE-WHEELERS
Two or three-wheelers are the most electrified market segment today, outnumbering cars in emerging markets and developing economies. In 2022, over half of India’s three-wheeler registrations were electric, demonstrating their growing popularity due to government incentives and lower costs compared to conventional models.
India leads on sales of electric three-wheelers, with 425,000 units sold in 2022 followed by China with nearly 350,000 units. Together, the two countries account for nearly 99 per cent of global electric three-wheeler sales.
The report also noted there are promising signs for emerging EV markets, with 2022 being a growth year in India, Thailand and Indonesia. India in particular has seen a notable growth but electric car sales in emerging markets remain low relative to the three major markets China, Europe and the US.
Collectively, sales of electric cars in India, Thailand and Indonesia reached 80,000 in 2022. BEV sales in India reached nearly 50,000, four times more than in 2021.
Model availability also remains an issue in emerging market and developing economies.
Available options tend to be geared towards the higher end such as SUVs, large and luxury models, making them largely unaffordable.
The future of mass-market electrification in emerging market and developing economies depends on development of smaller and more affordable electric cars alongside two- and three-wheelers, said the report.