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Worldwide sales of electric cars are expected to surge by another 35% in 2023 to reach 14 million and the share of the overall car market has risen from around 4% in 2020 to 14% in 2022 and is set to increase further to 18% this year, according to the International Energy Agency (IEA).
Sales of electric vehicles are set to surge yet another record this year, expanding their share of the overall car market to close to one-fifth and leading a major transformation of the auto industry that has implications for the energy sector, especially oil, IEA said in its annual Global Electric Vehicle Outlook.
“Electric vehicles are one of the driving forces in the new global energy economy that is rapidly emerging – and they are bringing about a historic transformation of the car manufacturing industry worldwide,” said IEA Executive Director Fatih Birol. “The trends we are witnessing have significant implications for global oil demand. The internal combustion engine has gone unrivalled for over a century, but electric vehicles are changing the status quo. By 2030, they will avoid the need for at least 5 million barrels a day of oil. Cars are just the first wave: electric buses and trucks will follow soon.”
Biggest markets
Majority of electric car sales to date are mainly concentrated in three markets – China, Europe and the US.
According to the IEA report, China is the frontrunner, with 60% of global electric car sales taking place there in 2022. "Today, more than half of all electric cars on the road worldwide are in China. Europe and the United States, the second and third largest markets, both saw strong growth with sales increasing 15% and 55% respectively in 2022," the report noted.
By 2030, the average share of electric cars in total sales across China, the EU and the United States is set to rise to around 60%.
"Ambitious policy programmes in major economies, such as the Fit for 55 packages in the European Union and the Inflation Reduction Act in the United States, are expected to further increase market share for electric vehicles this decade and beyond," the report noted.
China also dominates the battery and component trade.
Electric car sales more than tripled in India and Indonesia last year, albeit from a low base, and they more than doubled in Thailand. The share of electric cars in total sales rose to 3% in Thailand, and to 1.5% in India and Indonesia, the report said.
EVs in the Middle East
Saudi Arabia and the UAE are the early adopters of EVs in the Middle Eastern region. The Middle East and African electric vehicle market is expected to reach $93.10 million, registering a CAGR of more than 15% during the forecast period, according to Mordor Intelligence.
The rising focus on EV adoption in GCC states is driven by national commitments to accelerate the transition from fossil fuels to renewable energy sources, to achieve net-zero targets in the coming years.
The Saudi Arabian Standards Organization (SASO) is planning to issue regulations for the use of EVs. The UAE's Road Transport Authority (RTA) has issued advisory messages and worked to develop charging stations in the Emirates.
Saudi Arabia has its own homegrown EV brand, Ceer Motors and is the majority owner of Lucid Group through its sovereign wealth fund, PIF.
(Reporting by Seban Scaria; editing by Daniel Luiz)
