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The future of cars is electric – but how soon is this future?

According to a new report by BloombergNEF, 58% of global passenger vehicle sales in 2040 will come from electric vehicles, yet they will make up less than 33% of all cars on the road.

From pv magazine USA

While popular science fiction has set high the expectations of what the future of transportation will look like, BloombergNEF has painted a picture of how the auto industry will evolve in its latest Long-term Electric Vehicle Outlook report.

BloombergNEF says electric vehicles (EVs) will account for 10% of global passenger vehicle sales in 2025, with that number rising to 28% in 2030 and 58% in 2040. According to the study, EVs currently make up 3% of global car sales.

Beyond just new sales, EVs are predicted to represent 31% of all cars on the road in 2040, making up 67% of municipal buses, 47% of two-wheeled vehicles (scooters, mopeds, motorcycles), and 24% of light commercial vehicles. Compare this to 2020, where EVs account for 33% of municipal buses, 30% of two-wheeled vehicles and 2% of light commercial vehicles. 

In terms of gross vehicle usage, BNEF predicts that 500 million passenger EVs will be on the road globally by 2040, compared to a total passenger vehicle fleet of 1.6 billion. Unfortunately, there will still be more miles driven globally by internal combustion passenger vehicles than EVs.

Sales and price parity

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The ramp-up in EV adoption will initially be led by reaching price parity with internal combustion engine vehicles. This will begin when large vehicles hit this point in Europe, which is expected to happen in 2022. It will end with small cars making the achievement in India and Japan around 2030.

While this parity takes a global perspective, it will be hard-driven by the European and Chinese markets, which are expected to represent 72% of all passenger EV sales in 2030. By 2030, China and Europe are expected to achieve the feat of 50% of all cars on the road being EVs. This will be because of the other head of EV adoption, policy support.

As for the United States, the country will be slower to reach the levels of adoption that are expected to come to Europe and China, due to limited projections of charging infrastructure availability. But the United States does have one factor working in its favor to make a quick catch-up possible by the end of the 2030s, according to BNEF: Nearly 60% of U.S. households have two or more cars, and many have the ability to install home charging.

In South Korea, like Europe and China, the adoption timeline is predicated upon strong government policy support. However, the country will also get a push from its domestic auto and battery manufacturers.

The BloombergNEF report also notes that there will be 550 EV models available from global auto manufacturers by 2022. Despite this prediction, Japan – home to a bevy of international vehicle manufacturers that already include a number of EVs – is not expected to take off until 2025. The report states that this is when Japanese automakers will launch more EV options.

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Source: pv magazine