According to a report by the International Energy Agency.
This represents an EV share of nearly 9% of the global passenger vehicle market in 2021, and almost triple its market share from the previous two years. The significant volume growth of the electric vehicle segment over the past three years is notable for having taken place during the pandemic, when automakers were struggling with bottlenecks in their supply chains, according to the report. of the IEA.
Electric vehicle sales were also stronger in the latter part of the year, with December volumes in the three major markets more than 2.5 times higher than January volumes, he said. Throughout 2021, monthly electric vehicle sales were “consistently at least 50% higher” than the corresponding month in 2020, the IEA report writes.
Around 16 million electric vehicles are now estimated to be on the roads around the world, collectively consuming around 30 terawatt hours (TWh) of electricity per year, the same amount as all the electricity generated in Ireland, according to the ‘OUCH.
China led global markets in electric vehicle volume growth by a significant margin, recording 3.4 million sales in 2021, more than the volume sold globally in 2020, according to the IEA. The annual increase is the fastest gain in China’s electric vehicle market since 2015, and also outpaced the more gradual recovery in the overall passenger vehicle sales market, the IEA wrote.
In 2021, electric vehicles accounted for 20% market share in China in December, compared to 7.2% in January of the same year. The official sales target set by the Chinese government is for electric vehicles to reach a 20% full-year market share by 2025, and the performance of electric vehicle sales in the country suggests that the segment is on track to achieve its goal, the IEA noted.
The report attributes the gains of the Chinese market to several factors, namely the extension of government subsidies in China for another two years following the outbreak of the pandemic. Gains have continued despite subsidy removal with a 10% reduction in 2021 and 30% for 2022, and the growth of the electric vehicle market over the past year despite the subsidy reduction suggests that the electric vehicle market in China could mature, the IEA said.
On the other hand, the strong sales performance in China’s electric vehicle segment may also reflect overheated demand from customers rushing to get subsidies offered in 2021 ahead of its reduction this year, the report said, while another factor is the growing range of small cars being made available in the Chinese market. The super-compact Wuling Hongguang Mini EV was among China’s best-sellers last year, despite not being eligible for electric vehicle subsidies, the report noted.
Meanwhile, in Europe, sales of electric vehicles reached 2.3 million units, a gain of almost 70%, of which about half are plug-in hybrids. Overall, the European car market has yet to recover from the effects of the pandemic, with overall vehicle sales in 2021 being 15% lower than in 2019, according to the IEA.
The IEA said the increase in electric vehicle sales in Europe was partly due to new CO2 emissions standards on the continent, and that the gains were also attributed to subsidies for the purchase of electric vehicles which have increased and extended in most major European markets. Monthly EV sales in Europe last year were strongest in the last quarter, peaking in December when EV sales overtook diesel vehicle sales for the first time, with EVs accounting for a share 21% in Europe.
In terms of markets by country, Germany was Europe’s largest for electric cars, the continent where “more than one in three new vehicles” sold in November and December was an electric vehicle. These accounted for 17% of total European sales in 2021, but there were significant differences between countries; Electric vehicles accounted for 72% of sales in Norway, 45% in Sweden and 30% in the Netherlands.
Among the “large European markets”, Germany had the largest share of electric vehicles with 25%, followed by the United Kingdom and France, both with 15%, Italy with 8.8% and Spain with 6.5%.
As the overall U.S. auto market recovered, so did its electric vehicle segment, which more than doubled its 2020 count to surpass 500,000 units sold in 2021, according to the IEA. Tesla remains the largest electric vehicle player in the United States, which continues to account for more than half of all electric vehicles sold in the market.
Tesla, however, also suffered a decline in market share, down from the 65% it held in 2020, as other automakers brought a growing range of new electric vehicles to market.
Sales of electric vehicles in these major markets of China, Europe and the United States are not growing at the same rate as other global markets, while the aforementioned markets represent approximately two-thirds of the overall automotive market and 90 % of EV sales, most other markets see EVs accounting for less than 2%.
Major developing economies such as Brazil, India and Indonesia are seeing electric vehicle penetration below 1% “without any significant increase” over the past year, the IEA report writes. These countries are seeing growth in the e-scooter and e-bus segments, but the price premium of electric cars as well as the lack of charging infrastructure are cited as the main reasons for slow adoption.
Other developed economies in Asia show varying levels of adoption of electric vehicles in their respective markets; Japan has seen EV market share remain below 1% for the past three years, but Korea has seen EV sales more than double in 2021 after two years of stagnation, with electrification gaining 8% share Steps. Meanwhile, Australia started from a low baseline, but more than tripled the share of electric vehicles to 2% in 2021.
There is a lot of room for growth in the electric vehicle segment, but the automotive industry supply chain presents challenges not only for the electric vehicle segment, but for the automotive industry as a whole, a said the IEA in its report. In 2021, the price of steel has increased by 100%, that of aluminum by 70% and that of copper by more than 70%, which affects both the production of conventional ICEs and electric vehicles, he continued.
The challenges for electric vehicles are compounded by rising prices for the materials needed to make batteries, such as lithium carbonate which has gained 150% in price year-on-year, graphite by 15%, 25% nickel, and more, the ratio added.
In a separate IEA report on the role of critical minerals in clean energy transitions, global markets could face lithium and cobalt shortages as early as 2025 – just three years from now – unless enough investment is forthcoming. be made to increase production. This will require accelerating not just mineral extraction, but the entire electric vehicle value chain, the report says.
In terms of automakers’ commitments to their development and the growth of the electric vehicle market, Toyota, a longtime proponent of hybrid electrification, announced last December that it would roll out 30 battery-electric vehicles by 2030. alongside carbon reduction and carbon neutrality efforts, while Volkswagen has pledged to phase out the sale of ICE-powered vehicles by 2035.