An increase in sales is attributed to conducive policies in Europe and China, while high prices have made them unaffordable in developing countries.
Electric car sales powered through 2021 and have
remained strong so far in 2022, but ensuring future growth will demand greater
efforts to diversify battery manufacturing and critical mineral supplies.
The increase is attributed to conducive policies in Europe and China, while high prices have made them unaffordable in developing countries.
According to the latest Global Electric Vehicle Outlook
International Energy Agency, sales of electric cars (including fully electric
and plug-in hybrids) doubled in 2021 to a new record of 6.6 million, with more
now sold each week than in the whole of 2012.
The report notes that despite strains along global
supply chains, sales kept rising strongly into 2022, with 2 million electric
cars sold worldwide in the first quarter, up by three-quarters from the same
period a year earlier.
The number of electric cars on the world’s roads by
the end of 2021 was about 16.5 million, triple the amount in 2018.
Electric car sales nearly tripled in 2021 to 3.3 million in China, accounting
for about half of the global total.
Sales also grew strongly in Europe (increasing by
65% to 2.3 million) and the United States (more than doubling to 630,000). Chinese electric cars are typically smaller than in other markets.
lower manufacturing costs, this has significantly reduced the price gap with
price of an electric car in China was only 10% more than that of conventional
offerings, compared with 45% to 50% on average in other major markets.
By contrast, electric car sales are lagging in most
emerging and developing economies where only a few models are often available
and at prices that are unaffordable for mass-market consumers.
Sustained policy support has been one of the main reasons for strong electric
car sales in many markets, with overall public spending on subsidies and
incentives doubling in 2021 to nearly USD 30 billion.
A growing number of countries have ambitious vehicle
electrification targets for the coming decades, and many carmakers have plans
to electrify their fleets that go beyond policy targets. Five times more electric car models were available
globally in 2021 than in 2015, and the number of available models reached 450
by the end of 2021.
“Few areas of the new global energy economy are as dynamic as electric
vehicles, the success of the sector in setting new sales records is extremely
encouraging, but there is no room for complacency,” said IEA Executive Director
Fatih Birol. “Policy makers, industry executives and investors
need to be highly vigilant and resourceful in order to reduce the risks of
supply disruptions and ensure sustainable supplies of critical minerals. Under
its new Ministerial mandate, the IEA is working with governments around the
world on how to strategically manage resources of critical minerals that are
needed for electric vehicles and other key clean energy technologies.”
In the short term, the greatest obstacles to continued strong EV sales are
soaring prices for some critical minerals essential for battery manufacturing,
as well as supply chain disruptions caused by Russia’s attack on Ukraine and by
continued Covid-19 lockdowns in some parts of China.
In the longer
term, greater efforts are needed to roll out enough charging infrastructure to
service the expected growth in electric car sales, the report says.
Prices for lithium, a crucial mineral for car batteries, were over seven times
higher in May 2022 than at the start of 2021, and prices for cobalt and nickel
All else being equal, the cost of battery packs
could increase by 15% if these prices stay around current levels, which would
reverse several years of declines. Russia’s invasion of Ukraine has created
further pressures, since Russia supplies 20% of global battery-grade nickel.
Governments in Europe and in the United States have promoted industrial
policies aimed at domestic development of EV supply chains, as more than half
of all lithium, cobalt, and graphite processing and refining capacity is
located in China. In addition, China produces three-quarters of all
lithium-ion batteries and has 70% of the production capacity for cathodes and
85% for anodes, both of which are essential components of batteries.
More than half of all-electric cars in 2021 were
assembled in China, and the country is poised to maintain its manufacturing
While nearly 10% of all cars sold worldwide in 2021 were electric, the figure
for global truck sales was just 0.3%.
This share would need to increase to around 10% by
2030 in a scenario aligned with the climate pledges and targets announced to
date by countries worldwide – and to 25% by 2030 in the IEA’s Net Zero
Emissions by 2050 Scenario.
Electric trucks have so far been substantially
deployed only in China, thanks to strong government support.
But other countries have announced plans for heavy
truck electrification, and manufacturers are widening their choice of models.
Long-range trucks require high-power charges that
are currently expensive and often require grid upgrades.
The new IEA report
recommends greater government support and planning for public charging