The Agency estimates that there are currently around 16mn EVs on the road worldwide, consuming roughly 30 TWh/y of electricity. 

China accounted for more than half of all EVs sold globally, with sales in 2021 nearly tripling to 3.4mn. The Chinese government’s official target is for EVs to reach a 20% domestic market share by the end of 2025.

Several factors underpin the Chinese market’s dynamism. The government extended EV subsidies for a further two years after the Covid-19 pandemic broke out, albeit with a planned reduction of 10% in 2021, and 30% in 2022. The growth in 2021 sales despite the scaled-back subsidies suggests China’s EV market may be starting to mature, notes the IEA, but it also could reflect customers rushing to secure subsidies at 2021 levels before they declined at the start of 2022. Another important factor is the expanded range of small car offerings in China. The tiny Wuling Hongguang mini EV is not eligible for subsidies but was still among the bestselling models in the country last year, offering an affordable entry point to the market for new customers. 

There is also strong growth in Europe, where EV sales increased by nearly 70% in 2021 to 2.3mn, about half of which were plug-in hybrids. According to the IEA, while annual growth was slower than in 2020, when sales more than doubled, this took place against the backdrop of an overall European automotive market that had not recovered from the pandemic. Total car sales in 2021 were 25% lower than in 2019. 

The surge in EV sales in Europe last year was partially driven by new CO₂ emissions standards. Purchase subsidies for EVs were also increased and expanded in most major European markets. Monthly sales in 2021 were highest in the last quarter of the year, peaking in December when European sales of EVs surpassed diesel vehicles for the first time, with a 21% market share, reports the IEA.

In absolute terms, the largest EV market in Europe in 2021 was Germany, where more than one in three new cars sold in November and December was electric, says the IEA. Overall, EVs accounted for 17% of total European sales in 2021, but there were significant differences across markets. Norway at 72%, and Sweden and the Netherlands at 45% and 30% respectively, sat atop global rankings. At 25%, Germany had by far the highest market share among large European markets, followed by the UK and France (both around 15%), Italy (8.8%) and Spain (6.5%).

Meanwhile, the US made an impressive return to the electric car market in 2021 as sales more than doubled to surpass half a million. The overall US car market recovered as well, but EVs doubled their share to 4.5%. The US EV market is still mostly dominated by Tesla, which accounts for more than half of all electric units sold. Tesla’s market share nonetheless declined from 65% in 2020 as new electric models were offered by other auto manufacturers, such as VW Group, General Motors and Stellantis.

In contrast, the market for EVs is barely growing in large developing economies such as Brazil, India and Indonesia, where the share is still below 1% without any significant increase over the past year. While sales of electric scooters and buses are expanding in these countries, the price premium attached to EVs and a lack of charging infrastructure are key reasons for the sluggish uptake, says the IEA. In Japan, EV sales also barely increased, with their market share remaining below 1% over the past three years. 

Photo: Wikimedia Commons/David290