EVs Projected To Capture 25% Of Global Auto Sales This Year

Electric vehicles (EVs) are on track to represent more than one-quarter of all cars sold globally in 2025, according to a new report by the International Energy Agency (IEA). The forecast suggests EVs could constitute over 40 per cent of worldwide automobile purchases by 2030 if current trends continue.

The IEA's "Global EV Outlook 2025" report says that the electric vehicle market continues its expansion despite various obstacles. Electric car sales reached an unprecedented 17 million units in 2024, pushing their global market share beyond 20 per cent for the first time. This upward trajectory has persisted into 2025, with EV sales increasing 35 per cent year-over-year during the first quarter. Record-breaking Q1 figures were observed across all major markets.

China Dominates, Emerging Markets Gain Momentum

China retains its substantial lead in the global EV landscape, with electric vehicles accounting for nearly half of all automobiles sold there in 2024. The country's 11 million EV sales last year exceeded the entire world's combined total from just two years prior. Meanwhile, developing economies across Asia and Latin America have experienced remarkable growth, with EV sales surging by more than 60 per cent during the previous year.

In the US, electric vehicle sales grew approximately 10 per cent compared to the previous year, now representing over 10 per cent of new automobile purchases. Conversely, Europe's EV market has stabilized, maintaining a market share of approximately 20 per cent as government incentive programmes began to diminish.

"Our data shows that, despite significant uncertainties, electric cars remain on a strong growth trajectory globally," IEA executive director Fatih Birol said in a statement. 

"Sales continue to set new records, with major implications for the international auto industry."

Price Reductions

A significant factor behind increasing adoption is the declining cost of electric vehicles. The average price of battery-powered cars decreased in 2024, attributed to heightened competition and reduced battery costs. In China, two-thirds of EVs purchased last year were less expensive than comparable internal combustion models, even without government subsidies. However, in markets such as the US and Germany, the initial purchase price of EVs remains higher -- approximately 30 per cent more in the US and 20 per cent more in Germany.

Nevertheless, electric vehicles maintain an advantage regarding operational expenses. The report indicates that even if oil prices fall to $40 per barrel, charging and operating an EV at home in Europe still costs approximately half as much as fuelling and maintaining a gasoline-powered vehicle.

Chinese Exports Reshape Global Landscape

The report highlights the expanding influence of Chinese EV exports in the global market. Approximately 20 per cent of all electric vehicles sold worldwide last year were imported products. China, which manufactures over 70 per cent of the world's EVs, exported 1.25 million units in 2024. These exports have contributed significantly to price reductions in emerging markets, making electric vehicles increasingly accessible to consumers worldwide.