A new report says that electric car sales are expected to increase massively in the next few years, reaching 55 percent of global new car sales by 2040 and replacing 7 percent of gas and diesel consumption.
Sales of electric cars have just managed to top 1.1 million per year, but a new report from Bloomberg New Energy Finance says that they are set to grow to 11 million in 2025 and topping 60 million vehicles, about 55 percent of the new car market, by 2040. The prediction is that EVs will have replaced 33 percent of the total global car fleet by then.
Helping to lead that demand, Bloomberg expects the number of EV choices to jump. Currently, there are 155 electric vehicle models available for sale worldwide. The report expects that to jump to 289 by 2022 with some automaker converting fully to electric by 2025.
The sales increase will be led by China, with that country expected to make up 50 percent of the EV market globally by 2025, with that number sliding as the rest of the world catches up. It will continue to be the largest EV market in the world.
Bloomberg has been tracking the cost of EV battery prices since 2010 and expects that EVs will begin to become cost competitive with ICE vehicles starting in 2024 with no subsidies due to falling costs, with most segments reaching that cost parity by 2020.
This growth will need a massive scale-up in the supply of batteries and electric motors. Current lithium-ion battery capacity is in the area of 131 gigawatt-hours per year, expected to jump to 400 GWh by 2021. Bloomberg predicts it would need to exceed 1,500 GWh by 2030 to keep up with demand. To help combat rising raw material cost and increasing rarity, manufacturers are moving to lower cobalt batteries, but the report says that for battery pack cost to drop below $100 per kilowatt-hour, a new technology will be needed.
More EVs in the passenger car and transport markets will mean 7.3 million barrels per day of gasoline and diesel displaced, by Bloomberg’s prediction. That’s around seven percent of total gas and diesel consumption.
The prediction is that electric car sales will skyrocket over the next decade, but then slow as charging infrastructure and potential material shortages catch up. But they will still make up a significant portion of the market in the coming years.
A version of this story originally appeared on Hybrid Cars
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