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The global car market is expected to hit a slump this year due to coronavirus lockdowns, but electric-powered vehicles will be less affected by the downturn.
Around 2.3 million electric cars are likely to be sold this year, exceeding 2019’s total sales and representing a record share of the overall car market of more than 3 percent, the International Energy Agency (IEA) said in a new report.
“Electric cars are likely to have a much better 2020 than the rest of the auto industry. Electric cars are gradually becoming competitive in some countries on the basis of the total cost of ownership, which includes fuel expenses as well as purchase costs,” IEA said in a note.
According to IEA, there are several factors that will help prop up the sales of electric cars. Governments in some markets offer a host of incentives to electric car buyers in the form of direct purchase subsidies or tax reductions. Eco-friendly vehicles also tend to appeal to the wealthy segment of the market, which is believed to be less affected by the current financial crisis.
Besides, there will be more options available this year, with around 100 new electric models expected to be unveiled over the course of 2020.
“Against this backdrop, it is quite possible that global electric car sales in 2020 will continue their upward trend, experiencing a substantially lower impact than the overall car market,” said IEA.
Overall, the car industry has been impacted severely by the pandemic, with practically all major car manufacturers halting production lines for varying periods of time. The total lockdowns, which were eased recently, also stopped potential buyers from upgrading their vehicles.
IEA said it expects total car sales this year to drop by 15 percent to around 13 million, which is twice the size of the decline that occurred during the global financial crisis between 2008 and 2009.
(Writing by Cleofe Maceda; editing by Seban Scaria)
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