IEA: 2024 set to be record-year for global EV sales

In its Global EV Outlook, the International Energy Agency (IEA) predicts a “robust” 20% growth in electric vehicle (EV) sales for the entirety of 2024. This optimistic projection positions the year to shatter previous records, with an estimated 17 million EVs expected to be sold. The findings are surprising as they collide with earlier signs of a stalling market for electric cars.

Despite reduced profit margins, fluctuating prices for battery raw materials, high inflation, and the phasing out of purchase incentives in several countries, including one of Europe’s biggest markets, Germany, the global outlook for EV sales remains largely positive. Sales are expected to reach 17 million by the end of the year (from 14 million in 2023).

The Global EV Outlook clearly shows that the regions grow at different speeds. While some European markets are experiencing weaknesses, China continues to dominate the EV landscape with strong sales figures and less susceptibility to these global pressures.

One in five is BEV

In the first quarter of 2024 alone, EV sales surged by 25% year-over-year, mirroring growth rates from 2023, which was also a record year. BEVs are projected to account for more than one in five new cars sold globally this year. Market penetration rates are forecasted to reach a whopping 45% in China, 25% in Europe, and 11% in the United States, fueled by competitive pricing, reduced battery costs, and still enough countries upholding public subsidies.

The IEA also notes an upward trend in emerging markets like Vietnam and Thailand, where electric cars account for 15% and 10%, respectively, of the national fleets.

The affordability of electric models is a key driver in the uptake, which helps explain why premium car makers like Tesla and Polestar are experiencing headwinds despite the growth. In China, where BEVs are cheaper than their combustion engine counterparts in 60% of the cases, the affordability trend is strong. The IEA expects it to generalize across other major automotive markets, but primarily by 2030.

Ambitious future

IEA projections also reveal an ambitious future: by 2030, nearly one-third of all vehicles on Chinese roads could be electric, and in Europe and the USA, a ratio of one in five is expected. By 2035, electric vehicles could represent half of all global car sales, which, according to the organization, could potentially reduce oil consumption by 10 million barrels per day.

Under the surface, the surge in the uptake is particularly beneficial for Chinese manufacturers, who currently produce over half of all the electric cars sold worldwide despite representing only a tiny fraction of combustion engine car sales.

IEA Director Fatih Birol highlights: “The continued momentum behind electric cars is clear in our data, although it is stronger in some markets than others. Rather than tapering off, the global EV revolution appears to be gearing up for a new phase of growth.”