ELECTROMOBILITY Electric vehicles market continues on a strong growth trajectory
We’re now well into Q4. As we approach 2022, here’s an overview of how the electric vehicle industry is getting on after what has been and continues to be a turbulent time for the worldwide automotive sector in general.
We’re quickly approaching two years since a new novel coronavirus emerged in Wuhan, China, and to say that the past 18-or-so months since the COVID-19 pandemic first shook the world have been both a difficult yet historic time would be a huge understatement.
One industry that has perhaps experienced one of the most uncertain times of all is the electric vehicle (EV) market. In the earliest stages of the pandemic in 2020, production came to an abrupt stop, yet the increased levels of staved-off demand that came about towards the end of the year saw EV sales hit a record high. This continued into 2021 and as more countries demonstrate significant legislative efforts to improve EV infrastructure and cut their carbon emissions, this growth is expected to continue.
Record EV sales in 2020
Just like the microelectronics industry which saw revenue climb to a high of USD442 billion, global EV sales increased more than 40 % last year, even while overall car sales fell by 6 %. This is according to a report by the International Energy Agency (IEA), which recorded more than 3 million new EV registrations during a year decimated by pandemic-related disruption.
The report estimates that the global market is well on track to reach 145 million EVs—cars, buses, vans, and trucks—by 2030, roughly 7 % of all global vehicles. If governments are to continue pursuing zero-emissions targets and prioritize clean energy, however, the report says that the number of EVs on the road could be 85 million higher for a total of 230 million by this time.
Improving EV infrastructure
One of the biggest pain points for EV owners at present is the lackluster EV infrastructure, particularly in relation to charging stations. This, coupled with issues like so-called “range anxiety” and consumer education, is a huge barrier to entry and most nations are now looking for ways to improve their domestic EV infrastructures.
Last year saw an increase in growth in the number of charging stations and outlets available to drivers alongside the increase in the number of EVs on the road. The IEA report noted that the number of publicly available fast chargers increased by more than 1 million last year. This was led by Europe, with numbers indicating a 55 % increase from 2019 for a total of roughly 285,800 charging stations. In China, the number of charging stations increased by 44 %.
Meanwhile, in the U.S., efforts are underway to make EV charging expansion a priority. According to Department of Energy data, the U.S. currently only has just over 43,400 public charging stations nationwide. Proposals include a USD2 trillion infrastructure package and increased state-level investment, such as California’s recently announced USD436 million ‘Edison’s Charge Ready’ program which will install 38,000 new chargers over the next five years.
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Europe leads the charge
2020 was also the year that Europe began to emerge as a serious competitor to the U.S. and China in the EV market. According to the IEA study, Europe led the global market for EVs in 2020 with 1.4 million new registrations. China and the U.S. recorded 1.2 million and 295,000 new registrations respectively.
Northern Europe—Norway, Iceland, Sweden, Finland, and the Netherlands—recorded the largest share of new EV sales and a 60 % compound annual growth rate between 2016 and 2020. It’s no coincidence that these countries are some of the top performers in Europe when it comes to tackling climate change, with the European Union itself also pursuing its goal to hit net-zero carbon emissions by 2050 with a range of new legislation and policy introductions, such as the phasing out of combustion engines by 2035.