Electric cars set for strong growth in 2024, IEA says in new outlook

Electrification of road transport will be crucial to achieve emissions reductions and limit global warming over the coming decades. In its annual Global Electric Vehicle Outlook, the International Energy Agency (IEA) said that the rollout of electric vehicles has strong momentum, with 2024 set to be a new record year for global electric vehicle sales.

The forecast comes on the back of major electric car makers such as Tesla and BYD reporting falling sales in the first quarter of 2024. IEA Executive Director Fatih Birol said in a statement, “Rather than tapering off, the global EV revolution appears to be gearing up for a new phase of growth.”

The IEA forecasts that electric car sales will reach 17 million in 2024, up +20% from the 14 million electric cars sold in 2023. Note that the IEA defines both fully battery-powered electric vehicles and plug-in hybrid vehicles as electric.

Over 10 million of the 17 million cars projected to be sold are expected to come from China, 3.4 million from Europe, and 1.7 million from the United States. The share of new cars sold that are electric is, as a result, expected to rise to 45% in China, 25% in Europe, and 11% in the United States in 2024.

Together, these three regions accounted for 90-95% of all electric passenger cars sold, highlighting the geographical concentration of electric vehicle sales. For comparison, these three regions accounted for 65% of all new car sales worldwide in 2023.

The IEA stated that, “…the pace at which electric car sales pick up in emerging and developing economies outside China will determine their global success.” In 2023, notable growth was seen in countries such as Vietnam and Thailand, where electric cars accounted for 15% and 10% of all cars sold, respectively. Yet, in large car markets such as India (2% EV share), Brazil (3% EV share), Indonesia (2% EV share), and Malaysia (2% EV share), the IEA expects future growth due to policy measures supporting electric vehicle sales.

Based on today’s policy settings, the IEA projects that by 2035 over half of new cars sold worldwide will be electric. This could rise to two-thirds if all national energy and climate targets made by governments are met in full and on time.

In both of these scenarios, that will mean that in 2035 around one-third of all cars on the road will be electric, up from above 3% in 2023.

While electric cars are becoming more affordable, the IEA highlights that the lack of small and medium-sized cars as a barrier to growth. In 2023, around 600 electric car models were available, with two-thirds of them being large vehicles and SUVs. Over time, the share of small and medium-sized electric vehicles out of all electric cars sold has declined in all major markets.

Improvements in charging infrastructure are also needed to help accelerate road transport electrification, with the IEA projecting that public charging capacity will have to increase sixfold by 2035 to keep pace with electric vehicle sales.

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