ICE Sales Peaked in 2017, EV Market Continues to Grow

While there is a significant difference in the adoption of EVs between developed and developing nations, it is difficult to see where sales of combustion vehicles will increase, even in areas like Southeast Asia where the auto market is expanding. With EVs anticipated to account for a large portion of the market increase, countries in Southeast Asia are competing to become centres for battery and EV manufacturing.

During the next three years, BNEF anticipates that the worldwide fleet of combustion vehicles will stay mostly stable. But, as the EV fleet grows, this trend is expected to reverse itself starting in 2026. There will be no chance of turning back after the fleet has turned, which will have a big impact on the amount of oil used and greenhouse gas emissions. According to BNEF’s calculations, 2027 will mark the peak for global oil consumption from the transportation sector.

The market for commercial vehicles is also being impacted by the move away from combustion-powered cars. In China, electric vehicles accounted for 7% of total commercial vehicle sales last year, with heavy truck sales crossing the 5% EV mark in December.

While it may be alluring to believe that developing nations may be able to somewhat counterbalance what is occurring in China, Europe, and North America, it is anticipated that combustion car sales will continue to drop and that the switch to electric vehicles will take some time. Nonetheless, the pattern is obvious, and it appears that the automobile sector will become more electric in the future.

Source: Bloomberg