Electric vehicle sales will continue to report strong growth on the global scale this year despite economic challenges in several markets, the International Energy Agency (IEA) predicts in a Tuesday report. However, it noted that electric vehicle affordability and charging infrastructure expansion will be crucial for the industry’s growth.
IEA’s EV sales forecast for 2024
The Paris-based autonomous intergovernmental organization forecasts global electric vehicle sales to reach a total of 17 million in 2024. It represents a notable increase from the 14 million sales record in 2023.
The report also noted that EVs will account for more than 1 in every 5 cars sold globally. In effect, the transportation sector can cut its heavy reliance on oil.
Unsurprisingly, the IEA expects China to contribute 10 million units of the projected 17 million EV sales this year.
This forecast is indeed remarkable given the ongoing economic challenges in some markets, including surging inflation and interest rates.
“Tight margins, volatile battery metal prices, high inflation, and the phase-out of purchase incentives in some countries have sparked concerns about the industry’s pace of growth, but global sales data remain strong.”
International Energy Agency
Q1 2024 results
According to the Paris-based energy watchdog, electric vehicle sales in Q1 2024 surged 25% from the same period in 2023. Although the rate remained the same between Q1 2022 and Q1 2023, the number of vehicles has increased.
It further noted that Q1 2024 sales equates to total sales recorded in full year 2020. Nonetheless, EVs’ share of total sales will vary by region, accounting for around 1 in every 9 vehicle sales in the US and 1 in 4 in Europe. Meanwhile, the figure stands at almost 50% in China, as per the IEA’s forecast.
In Europe, EV adoption is apparently impeded by a “generally weak outlook for passenger car sales and the phase-out of subsidies in some countries.”
Affordability issue
The EIA further indicated that affordability remains a key challenge in electric vehicle adoption. EV prices remain way higher compared to their gas-powered counterparts in Europe and the US.
Meanwhile, almost two-thirds of electric car sales in China in 2023 were more affordable than traditional cars.
“Electric cars are generally getting cheaper as battery prices drop, competition intensifies, and carmakers achieve economies of scale.”
International Energy Agency
The IEA also asserted that expanding the charging infrastructure by sixfold will be crucial to meet the growing number of EVs worldwide by 2035.
