Colin McKerracher
Head of Advanced Transport
BloombergNEF
Sometime this month, and maybe even this week, the total number of passenger EVs on the road will hit 12 million*. That’s up from 1 million in 2015. And the 12 million number represents a significant milestone: EVs are now 1% of all cars on the road globally.
A note of caution here: nailing down the total number of vehicles on the road globally is tricky. While new vehicle sales are easy to track, how long they stay on the road is much harder. Vehicles have a habit of migrating to emerging economies as they get older — digging up data on this from different corners of the world is more art than science. If you cross reference enough sources, you find there are about 1.2 billion passenger vehicles on the road, though some estimates put this as high as 1.4 billion.
So we’re at about 1%. What are some different ways to think about this?
Where they are: Just over 44% of all the EVs are in China, and about 35% are in Europe. North America is a distant third at around 17%; the rest are spread out in other markets, including South Korea and Japan. Just under 70% of the total EVs on the road are battery electrics, and the balance are plug-in hybrids. Sales of plug-in hybrids are surging right now in Europe to help automakers meet their CO2 targets, but haven’t really caught on in other countries.
When they were sold: About 70% of those 12 million EVs were sold in the last 3 years, and almost half were sold in the last year and a half. The passenger EV fleet has been doubling about every 18 months for the last few years, and there are good reasons to think that pattern will continue over at least the next four years, and maybe longer.
Time needed to add a million: This is shortening quickly. Knowing when to start the clock for the first million is difficult, but the second million took 18 months, the third just under 10 months and the fourth took 7 months. It now takes under 3 months to add a million, and by the end of 2021, that will be down to 2 months.
That all may sound impressive, but a herculean task remains of getting road transport emissions down in a meaningful amount of time. There’s quite a lag between what happens to new sales and what that means for the fleet. Even in a scenario where battery electric vehicles are 50% of global sales by 2030, they’ll still only be around 15% of the fleet. Looking at it another way, over the last 10 years, about 200 million cars have been added to the global vehicle fleet and almost all of those were traditional combustion models. That segment continues to grow quickly because automakers have gotten really good at making cars that last a long time.
Even so, there are plenty of good reasons for optimism on the EV front. Sales of combustion vehicles peaked in 2017 and have been falling since. With EVs now running at 10% of sales in in China, 15-20% in Europe’s main auto markets, and about to get a very big boost from the Biden administration in the U.S., it’s hard to see a route back to growth for the internal combustion engine. Investment tends to chase growth, rather than absolute market share. With sales of combustion vehicles now in permanent decline, automaker strategies will start to shift rapidly. The first 1% was definitely the hardest.
Our annual Electric Vehicle Outlook is out now. The report looks at these trends across different vehicle segments and considers what’s needed to keep the transport sector on track for a net zero world.
*Light duty passenger EVs only. There were about 1 million electric vans and trucks at the end of 2020, 600,000 electric buses and over 260 million electric two- and three-wheelers.