Technology 3 min read

New Report Shows Electric Vehicles are the Future King of the Road

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In its 2019 Global Energy Perspective report, consulting firm McKinsey expects energy demand in the world to hit a plateau by around 2030.

According to the report, this is due to the increasing share of renewables in the global energy mix in three major sectors: industry, construction, and road transport.

On that note, Mckinsey projects the sale of 100 million EV units by 2035, and “by 2050, there could be more than 2 billion electric vehicles on the road across all segments.”

Mackisey forecasts come close to those reported by the International Energy Agency (IEA), which in its Global Electric Vehicles Outlook report, projects around 125 million EVs on the road by 2030.

“Should policy ambitions rise even further to meet climate goals and other sustainability targets, as in the EV30@30 Scenario,” says IEA, “ the number of electric cars on the road could be as high as 220 million in 2030.”

EVs Slowly and Silently Replacing Fossil Fueled Cars on the Roads

“As the cost of batteries continues to decline, within the next 5-10 years, many countries will reach the point at which electric vehicles are more economic than internal combustion engine vehicles,” says Mckinsey.

But before we even reach the tipping point where EVs are cheaper than fossil fuel cars, the apparent signs of the shift are finally starting to manifest.

This true in the three largest auto markets in the world: China, the EU, and the United States.

This order is based on the three markets sales of both conventional and electric vehicles, and also on their respective EV cost tipping point.

While EVs would reach cost parity with combustion-engine vehicles in the early 2020s, China hits this threshold slightly earlier than the EU and the U.S.

This has something to do with the differences in electric cars subsidy and taxation programs in the three markets.

“The timing of total cost of ownership (TCO) parity in the US and China is comparable to Europe, with China slightly earlier and the US slightly later, reflecting differences in fuel taxation and subsidies for electric vehicles,” says authors of Mckinsey’s report.

Read More: Three Countries Driving the Electric Car Revolution

In 2018, more than 1 million plug-in electric vehicles (PEVs) were sold in China, with a 70% year-over-year growth.

In contrast, sales of conventional fuel vehicles dropped by about 800,000 units last year, from 28.88 to 28.08 million units, or a 2.76 percent year-on-year decrease.

In the EU and EFTA (European Free Trade Area), the market of combustion vehicles only slightly decreased, from 17.37 million in 2017 to 17.34 million in 2018. However, EVs made a 33 percent growth with 408,000 units sold in 2018, compared to 307,000 units in 2017.

The big picture in the third largest auto market, the U.S., is pretty much the same.

As a whole, the market basically stagnated with a slight increase in light vehicle sales, from 17.230 million in 2017 to 17.274 million in 2018. While the sales of fossil fuel powered vehicles dropped by about one hundred thousand, EV sales volumes made a spectacular 81 percent growth year-to-year, with 360,000 units in 2018 (up from 200,000 in 2017).

In addition to performance like autonomy, the competitivity of electric vehicles (EVs) comes down mostly to the cost factor. Potential customers think about how much it’d cost them to buy an electric car and run it.

As it becomes cheaper to own an EV than a fossil-fuel one, the trend will gain a significant boost.

Read More: Top 10 Fastest Electric Cars on the Planet

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Zayan Guedim

Trilingual poet, investigative journalist, and novelist. Zed loves tackling the big existential questions and all-things quantum.

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