Indicators emerging over the last 18 months increase the likelihood of plug-in vehicles becoming predominant over the next 20 years. However, continuing strong policy support is necessary to achieve this. The scenarios show plug in vehicles sales in 2040 at between just over half and nearly all of new light vehicles. However the time taken for the vehicle fleet to turn over means that they are a smaller proportion of the fleet, accounting for between a third and about three quarters of the light vehicle fleet by 2040. The large range of the scenarios reflects the large uncertainties involved, but they all show plug-in vehicles becoming predominant over the next 20 years or so.
Policy in many countries seems increasingly to favor plug-in vehicles. The market is currently growing rapidly from a low base. Total vehicle sales were 0.73 million in 2016, compared with 0.58 million in 2015. Six countries have reached over 1% electric car market share in 2016: Norway, the Netherlands, Sweden, France, the United Kingdom and China. Norway saw 42% of sales being EVs in June 2017
Manufacturers’ projections
Several manufacturers have issued projections for the share of their sales they expect to be for plug-in vehicles.
Manufacturer Target/expectation for plug-in vehicles
Volkswagen: 20-25% of sales by 2025
Volvo: All new models launched from 2019
PSA (Peugeot and Citroen brands): 80% percent of models electrified by 2023
As has been widely reported, Tesla has taken over 500,000 advanced orders for its Model 3 EV, itself equivalent to almost the entire market for electric vehicles in 2015. And in line with the Chinese Government’s targets manufacturers in China are expected to increase production rapidly, according to theenergycollective.com.
Projections by other observers
Projections by other observers are in most cases now in line with the scenarios shown here.
Morgan Stanley project 7% of global sales by 2025
BNP Paribas project 11% of global sales by 2025, 26% by 2030
JP Morgan project 35% of sales by 2025 and 48% of sales by 2030
Last year Bloomberg’s projections showed growth to be slower than with these projections. However they have since updated their analysis, showing 54% of new cars being electric by 2040. In contrast BP predicts much slower growth in their projections. However BP’s view seems implausibly low in any scenario in which regulatory drivers towards EVs are as strong as they appear to be. Exxon Mobil gives lower projections still, while OPEC’s are a little above BP’s.