• China will be leading the global EV market, followed by Europe and US.
• BEV will have nearly 40% share in the global passenger vehicle market by 2030.
• FCV will remain niche even in 2030.

New Delhi, London, San Diego, Buenos Aires, Hong Kong, Beijing, Seoul – May 30, 2022

One in two cars will have an electric powertrain by 2030, according to the latest research from Counterpoint’s Passenger Vehicle Forecast*. The increase in environmental awareness among buyers, favourable carbon emission norms, support from governments and the collaborative efforts of ecosystem players are all helping electric vehicle (EV) adoption across the world. However, EV penetration was still below 10% of global passenger vehicle sales in 2021.

Commenting on the regional dynamics, Senior Research Analyst Soumen Mandal said, “China is leading the global EV market, followed by Europe and the US. RoW (rest of world) will be the fastest growing region in terms of EV adoption, driven by Vietnam, Singapore, Thailand and Canada.

The EV market in China is influenced by government policies. However, China has reduced subsidies on EVs by 30% in 2022 compared to 2021. Further, the rising inflation rate and supply shortages due to COVID-19 outbreaks have forced OEMs to increase EV prices. April was the weakest month for EV sales in China this year. We expect the situation to improve after COVID-19 restrictions are relaxed and OEMs resume production. The EV sales in China are projected to cross six million units by the end of this year.

Europe is aiming to reduce emission levels by 15% in 2025 and by 37.5% in 2030 from the 2021 levels. This is one of the major reasons for Europe’s EV sales to cross the two million mark in 2021, despite the COVID-19 outbreak. More than 10 countries including Norway, Denmark, France, Germany, United Kingdom and Netherlands have proposed to phase out new sales of petrol and diesel cars. This will help Europe maintain its second position in the global EV market by 2030.

EV sales in the US increased by nearly 100% YoY in 2021. The Biden government has set an ambitious target of 50% of sales being EVs by 2030. Federal and state administrations had previously taken a less supportive approach to EV adoption compared to China and Europe. The latest policy will encourage both OEMs and consumers to be more comfortable opting for EVs over traditional fuel vehicles. Moreover, the US will provide $7.5 billion to build 0.5 million public EV charging stations. We expect the battery electric vehicle (BEV) will account for nearly 30% market share in US passenger vehicle sales by 2030 – but not the half that the government has targeted.”

Other countries contributing to EV adoption include Norway, Japan and India. EV adoption in Norway has already crossed 85% of sales in 2021 and we expect Norway will achieve 100% electrified passenger vehicle sales by 2025. Japan, however, is lagging in EV adoption compared to other developed countries. Toyota and Renault-Nissan have recently adopted a worldwide EV policy and we expect Japan will benefit from these homegrown OEMs. India is aiming to have 30% of its passenger vehicle sales as EVs by 2030. Already, homegrown players such as Tata Motors and Mahindra Electric and a few foreign players like MG Motor and Hyundai are competing for the Indian passenger EV market.

A few years back, it was thought that fuel cell vehicles (FCVs) would be one of the key technologies for the automotive market. However, FCV penetration hasn’t increased much and only a few players such as Hyundai, Toyota, Honda and SAIC are offering FCVs.Commenting on the competitive dynamics, Associate Director Brady Wang said, “The EV market is getting more competitive as new companies, including smartphone ecosystem players, are entering the field. Companies such as Foxconn and Xiaomi have already announced their entry into the smart electric car field to diversify business opportunities. Sony has partnered with Honda to produce affordable EVs.

Tesla is also a relatively new entrant. It introduced the groundbreaking Model S around 10 years ago and now dominates the global EV market. New start-ups like Nio, Li Auto, Xpeng, Lucid Motor, Fisker and Rivian are also trying to follow Tesla’s wheel tracks and disrupt traditional auto OEMs, many of which hesitated to invest in EV development in the initial phase. As next-gen cars will be much more software-driven, we will likely see more new players entering the market. However, the traditional players will still have an advantage thanks to their scale of manufacturing and well-established supply chains. Nevertheless, we expect a fierce battle between traditional and newer players in the coming years as EVs become increasingly mainstream.”

Commenting on EV infrastructure developments, Research VP Peter Richardson said, “Increased EV adoption will not, by itself, contribute to the goal of reducing overall vehicular pollution. While increased EV sales are positive, we also need to focus on setting up smart production ramps, more efficient battery manufacturing processes, battery recycling plants and charging infrastructure powered by renewable energy sources like solar, wind, hydro and nuclear. Unless we also adopt clean energy sources, the vision of attaining net-zero carbon emission will remain out of reach.”

In the initial years of EV adoption, there was a chicken-egg dilemma between governments and OEMs. Now, both parties are making collaborative efforts to make the transportation industry greener and more environmentally sustainable, helping smooth the transition from traditional fuel vehicles.

*Under electric vehicles, we are considering only battery electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs) and fuel cell vehicles (FCVs). Hybrid electric vehicles are not included in this study.

The comprehensive and in-depth ‘Global Passenger Vehicle Forecast, 2018-2030F’ is now available for purchase at report.counterpointresearch.com. Feel free to reach out to us at [email protected] for questions regarding our latest research and insights.

Background

Counterpoint Technology Market Research is a global research firm specializing in products in the TMT (technology, media and telecom) industry. It services major technology and financial firms with a mix of monthly reports, customized projects and detailed analyses of the mobile and technology markets. Its key analysts are seasoned experts in the high-tech industry.

Analyst Contacts:

Soumen Mandal

Peter Richardson

Brady Wang

Counterpoint Research

[email protected]

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