Electric Vehicle trends

Planetwide sustainability and environmental concerns

A growing number of electric vehicle drivers are demanding easy access to car charging facilities. They are also looking for car parking amenities where they can rest, have fun or go shopping, but just as importantly, they require access to e-car recharging on such sites.

Why is this trend growing today? The simple answer is global warming. The Paris Agreement sets out a global framework designed to avoid dangerous climate change by limiting global warming to below 2°C. It also aims to strengthen countries’ abilities to deal with the impact of climate change and to support them in their efforts. The European Union has been at the forefront of international efforts to fight climate change. It was instrumental in brokering the Paris Agreement and continues to show global leadership.

The European Union as a whole is committed to reducing greenhouse gas emissions by at least 40% by 2030. Transport contributes almost one-quarter (23%) of current global energy-related greenhouse gas (GHG) emissions, and is growing faster than any other energy end-use sector. By the year 2030, GHG emissions from transport are anticipated to rise by nearly 20%, and close to 50% by 2050, unless major action is undertaken.

According to the International Energy Agency, such a transition requires the implementation of global rail transport electrification, which is already underway, as well as at least 20% of all road transport vehicles globally to be electrically driven by the year 2030.

It is no surprise then that many countries and cities have already initiated such green initiatives. Going green has many benefits - companies can boost their image, and moreover, they can benefit from government assistance and attract new customers. On average, analysis shows that green customers have an elevated profile, good salaries, better shopping and cultural behaviors.

Here we list some of the most important current worldwide initiatives:

• The EV30@30 campaign sets the objective to reach a 30% sales share for EVs by 2030.

Fig. EV1 – Future global EV stock and sales by scenario, 2018-30 (Source: IEA, Global EV Outlook 2019)

• C40 CITIES is a network of the world’s megacities that are committed to addressing climate change.
• EV100 campaign is a global initiative that brings together 68 forward-looking companies committed to accelerating the transition to electric vehicles and making electric transport the ‘new normal’ by 2030.
• EVAPP - the Electric Vehicle Association of Asia Pacific is an international membership organization that promotes the development and use of electric and hybrid vehicles in the Asia and Pacific region.

City policies are key to reaching the commitment of 40% share of global EV sales from 25 global cities

Source: CAAM, Marklines, BNEF. ICCT. Chart is based on 2019 data, with December estimated for some countries/ cities. 40% figure is based on 2018 estimates

Fig. EV2 – 2019 passenger EV sales: by country/city, excluding U.S. and China

To date, 14 countries comprising approximately 20 cities around the world have proposed the future ban in the sale of passenger vehicles that are powered by fossil fuels such as gasoline, liquefied petroleum gas and diesel. China (the largest automobile market globally), is currently researching a timetable, Japan (number three in the global automobile industry), has comprehensive plans for a "hydrogen economy" by 2040, the UK, South Korea, Taiwan, as well as Denmark, Sweden, Norway, Germany, France, the Netherlands, Spain, Portugal and Costa Rica have similar plans.

Government regulation and incentives in the European Union

In 2014, the Alternative Fuels Infrastructure Directive (AFID) was adopted. At that time, the electric vehicle market in Europe was just starting out, with only a few models available on the market, such as the Renault Zoe, Nissan Leaf, BMW i3 and Tesla Model S. Back then, policymakers trying to determine the future EV market uptake and infrastructure needs had very limited experience.

Today, the situation is different: battery and charging technologies have progressed and will continue to do so for many years. With EU car and van CO2 standards in place for 2021-2025-2030, a wave of electric vehicle models is arriving in Europe, and policymakers now have much more clarity with regards to expected market uptake. Many elements that seemed uncertain in 2014 have now become much clearer.

AFID is currently elaborating a climate strategy, “The European Green Deal”. This strategy presents key political directions, flagships and funding mechanisms to support decarbonization, including the deployment of a charging infrastructure. AFID has committed to reviewing the Directive in 2021 to accelerate the deployment of zero- and low emission vehicles, and to deploy a funding call to support the deployment of public recharging and refueling points from 2020.

In most European countries, the main incentives are related to the ownership of e-Cars: that’s to say, no purchase tax, road benefits, exemption or reduction of ownership and company car taxes. More importantly, new regulations are in favor of the electrical vehicle infrastructure; specific EV public infrastructure investments are in place in Norway, Germany, France, UK, Netherlands, Sweden, Finland and Spain. New buildings will have to be equipped or pre-equipped, depending on the country, for electrical vehicle charging, and there are plans to upgrade electrical installations in residential and commercial buildings.

Electric vehicle: fast growth

2020 is witnessing a new phase for the Electrical Vehicle market. Up until 2019 we were witnessing fast growth driven by subsidies, with very few e-Cars models and few clear improvements and choices. The next phase will be accelerated by indirect policy mechanisms and the electrification of general transport beyond passenger vehicles.

Today, more than 7 million electric vehicles are on the road, globally. By the end of 2020 this figure could reach 10 million. EV adoption is becoming more popular and attractive for segments like buses, two-wheelers, ride hailing services, and delivery vans. Charging infrastructures are also growing, with almost 1 million public charging points now in place.

Fig. EV3 – Passenger electric vehicle sales, in millions (Source: BloombergNEF. Includes BEVs and PHEVs)

The global market share for e-Cars is 1.7%, but this figure is growing fast thanks to new e-Car models and prices, which are attracting more consumers, who are also making the most of the incentives and benefits associated with driving a zero-emission car.

China is the leading country for electrical vehicles, not only as a result of its commitment to electrification, but also due to the popularity of electrification amongst consumers. Car sales overall are declining by 12%, but the demand for pure electric cars has increased by 111%.

European EV sales are also rising significantly. This trend has been driven by national incentives, increased model availability and the rising concern over urban air quality. Europe is set to be the second largest EV market, but the market trends are very different from one country to another. Norway, the U.K, Germany, The Netherlands and France currently represent 75% of all sales in Europe. For 2020, 4% of passenger vehicles sales are expected to come from Europe, rising to 15% by 2025.

Fig. EV4 – Passenger electric vehicle sales, in millions (Source: IEA, Global EV Outlook 2019)

“By 2040, we expect 57% of all passenger vehicle sales, and over 30% of the global passenger vehicle fleet, will be electric”

Fig. EV5 – Global long-term passenger vehicle sales by drivetrain (Source: BloombergNEF, Electric Vehicle Outlook 2019)

Electric vehicle charging infrastructure: also growing fast

As regards the EV infrastructure, there are around 185,000 public charge points throughout the EU, which equates to around 7 cars per charge point, which is sufficient for the current market. Beyond 2020, this charging infrastructure will need to be developed in order to keep pace with the growing e-mobility industry. This is why new regulations for infrastructure for public and private investments are playing an important role in this new phase.

The charging deployment should be evenly spread across Europe to ensure all Europeans get the same opportunity to shift to zero-emission mobility.

Fig. EV6 – Cumulative global public charge connector installations 2019 (Source: BloombergNEF)