Leading the charge – the numbers behind the EV revolution

Electric vehicles (EVs) have been around in one iteration or another for more than a century, but in the last decade things have been changing rapidly. In 2019, global plug-in electric car sales totalled 2.2 million and accounted for 2.5% of the total car market. That percentage, as small as it might seem, reflects a 400% increase from sales in 2015. The following year, according to the International Energy Agency (IEA), EV sales reached record levels with 3 million new EVs registered. Equating to a year-on-year increase of 43%, the growth in demand and popularity is impressive particularly given the economic impacts of the global pandemic; and that during the same period, non-EV car sales contracted by 16%. A recent report by BloombergNEF forecasts that global EV sales will top 14 million in 2025. As more EV models hit the market, sales volumes should further accelerate. By mid-decade, shoppers around the world are expected to have the choice of more than 400 EV models. China and Europe account for the largest shares of registered EVs in the world, with China at about 42% (4.6 million cars) and Europe at around 30% (3.2 million cars). In Europe, EV sales have been, and will continue to be, turbo-charged by regulations. Regulations that, for example, set a requirement for manufacturers’ light-duty fleets to emit, on average, no more than 95 g/km CO2, making EV sales critical to balancing the emissions from other vehicles. In China meanwhile, fuel economy regulations and its longstanding new energy vehicle (NEV) credit score programme have fuelled the country’s leadership in EV markets.

Companies and consumers are increasingly prioritising low-emission technologies. In some ways this has been reaffirmed by the COVID-19 pandemic, which drove home the benefits of clean air as road traffic plunged in the wake of lockdowns. The drive to ”build back better” in many instances has become a push to ‘build back greener’, and governments across Europe and around the world have outlined economic stimulus measures that also support uptake of low- and zero-emission vehicles.  With some estimates predicting that electric vehicles represent a $46 trillion market opportunity between now and 2050, the imperatives behind the transition are economic as well as social and environmental.

In the US, the change in administration has resulted in further investments into green technologies. President Joe Biden has re-energised the push for CO2 reduction with multiple executive orders which are intended to accelerate the move to electrification in the US.

Efforts are, of course, being steered by a combination of government policy, emissions legislation and city-level decisions which heavily influence the corporate agenda. Meeting emissions standards in all markets is now at the heart of established automakers’ ambitions and represents a huge investment. The supply of metals is an integral part of that ambition. Understanding the scale of demand, its impact on pricing and how to manage the risks of price fluctuations over time in an efficient and effective way will be critical for everyone involved in honouring these commitments.

Published July 2021

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