The report presents two updated road transport scenarios: the base case Economic Transition Scenario (ETS) – in which EV adoption is shaped by current techno-economic trends and with no new policy intervention; and the Net Zero Scenario (NZS) – consistent with reaching a global zero emission fleet by 2050.

In BNEF’s base case ETS, EV sales continue to rise globally, even though growth has slowed in the US and Europe as a result of regulatory and political changes, and some automakers pushing back their EV targets. In the US, a lack of lower-cost models and EV market jitters inflamed by the upcoming presidential elections helped slow down adoption this year, while in Europe bloc-wide fuel-economy targets do not become more stringent until 2025, releasing automakers active in the region from the pressure to substantially increase sales of EVs.

The report also shows that EVs are no longer only for wealthy countries, with countries like Thailand, India and Brazil all experiencing record sales as more low-cost electric models are launched targeting local buyers.  Despite early signs of saturation of some EV segments and a tougher economic outlook, China is projected to maintain its lead as the biggest EV market globally.

The underlying technology for electrification continues to improve, battery prices continue to fall, and EV adoption is moving from being policy-driven to being driven by consumer demand across all markets. Passenger EV sales are expected to exceed 30mn in 2027 in the ETS and grow to 73mn per year in 2040, contributing 33% and 73% to global car sales in those years, respectively.

BNEF also finds that electrification is now spreading quickly to all sectors of road transport, from rickshaws to heavy trucks. Two- and three-wheeled vehicle sales continue to rise in emerging economies and electric sales are expected to exceed 90% globally by 2040.  

The decarbonisation of the commercial vehicle sector – including vans, trucks and buses – is set to accelerate. The rapid adoption of EVs across all vehicle segments creates an unprecedented market opportunity. The cumulative value of EV sales across all segments could hit $9tn dollars by 2030 and $63tn by 2050 in BNEF’s ETS.  

Despite the progress, global road transport is still not on course for a net zero trajectory, according to the report. While BNEF’s NZS calls for 100% of the road-going car fleet to be electrified by 2050, the base case ETS only achieves 69% in the same year. This shows that current techno-economic trends alone are not enough to get the transport sector on track for global climate goals, and that continued strong regulatory support is still very much needed, BNEF notes.  

Currently, only one segment of road transport – three-wheeled vehicles – is on track to reach net zero by mid-century. Heavy and medium-duty vehicles are the furthest off course for this goal: electric and hydrogen fuel-cell powertrains account for only 18% of global truck sales by 2030 and 43% by 2040 – and even this represents significant change for the industry.

‘Truck manufacturers are about to undergo a rapid technological transformation on the back of strict environmental targets in Europe and the US. The speed of that change will be unprecedented for the industry, but meeting a Paris-aligned scenario requires even faster production of zero-emission vehicles,’ says Nikolas Soulopoulos, Head of Commercial Transport, BNEF.

According to BNEF’s NTS, for the world to achieve a zero-emission vehicle fleet by 2050, sales of combustion vehicles will need to stop around 2038, with leading markets needing to phase out combustion vehicles even sooner, in the early 2030s. In the ETS, only the Nordic countries reach a full phase-out of combustion vehicles before 2038. As more countries implement industrial strategies to capture value from the transition, there is a risk that climate goals fall further out of reach.  

‘Governments trying to champion domestic manufacturing at the cost of faster decarbonisation should consider very carefully what they are prioritising, as reaching net-zero road transport emissions by 2050 is still possible, but much faster progress is needed,’ says Aleksandra O’Donovan, Head of EVs, BNEF. 
 

US government to expand EV charging network

The Biden-Harris Administration has opened applications for a $1.3bn funding opportunity for EV charging and alternative-fuelling infrastructure in urban and rural communities and along designated highways, interstates and major roadways.  

This is the largest single grant funding opportunity for EV charging given in the US and aims to accelerate public and private investment in clean transportation.

The government aims to build a national network of 500,000 public EV charging stations by 2030.