Overview of Global Electric Vehicle Trends for 2023

In the rapidly evolving world of automotive technology, electric vehicles (EVs) have taken centre stage. Last year, global spending on electric cars reached an impressive $425 billion, with an astounding 90% of the spending coming directly from consumers.

The surge in EV adoption has led to a significant increase in the demand for key battery components such as lithium, cobalt, and nickel. This growing demand is a clear indication of the expanding electric vehicle market.

According to the International Energy Agency (IEA), electric car sales are predicted to increase by 35% year-on-year by the end of 2023, totalling 14 million sales. This growth is not restricted to passenger cars alone; electric light commercial vehicle sales worldwide increased by more than 90% in 2022.

The shift towards electrification is particularly prominent in public transport. Countries with commitments to reducing emissions from public transport have seen high shares of electric bus sales. China, expected to be the largest market for electric vehicles by 2030, is no exception.

The European Union and the US have passed legislation to align with their electrification ambitions. The European Union's proposed Net Zero Industry Act aims for nearly 90% of the EU's annual battery demand to be met by EU battery manufacturers. Similarly, the US's Inflation Reduction Act aims to strengthen domestic supply chains for EVs, EV batteries, and battery minerals. Major EV and battery makers have announced cumulative post-IRA investments of at least USD 52 billion in North American EV supply chains.

India is also boosting domestic manufacturing of EVs and batteries through Production Linked Incentive (PLI) schemes. The number of available electric car models has doubled to 500 since 2018, indicating a growing diversity in the market.

The most electrified market segment for road transport today is two or three-wheelers, particularly in emerging markets and developing economies. Investors have shown confidence in EVs, with venture capital investments in start-ups developing EV and battery technologies reaching nearly USD 2.1 billion in 2022.

The ambition to electrify heavy-duty vehicles is growing, with 27 governments pledging to achieve 100% zero-emission bus and truck sales by 2040. These commitments include countries such as the United States, United Kingdom, Canada, Germany, France, Sweden, Norway, the Netherlands, Denmark, Finland, and others from Europe, North America, and parts of Asia and Oceania.

Battery manufacturing is expanding to meet the demand for electric vehicles. The US is projected to double its market share for electric vehicles by 2030, making it a significant player in this global transition. China, the main player in battery and EV component trade, remains at the forefront of this technological revolution.

As the world moves towards a more sustainable future, the electric vehicle market continues to thrive, with electric cars accounting for 18% of total car sales for the year 2023 and the IEA's projections showing that the share of EV sales will increase to 35% by 2030. This transition is not just a shift in technology, but a step towards a cleaner and greener planet.