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Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

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Electric Vehicle Sales Are Exploding In Europe

The next two years are likely to be the tipping point for electric vehicles (EVs) going mainstream in Europe, as the number of electric car models on the European market is set to more than triple in the next three years, Transport & Environment (T&E), Europe’s leading clean transport campaign group, says in a new analysis

According to T&E, which analyzed the upcoming offerings using data from authoritative industry source IHS Markit, the number of EV models made across the European Union (EU) will jump from around 60 models available at end-2018 to a total of 214 battery electric (BEV), plug-in hybrid (PHEV), and fuel cell (FCEV) models in 2021, and further up to 333 models in 2025.

“Until recently, the EV market was limited to a niche of early adopters but tomorrow’s landscape will be very different as EVs enter a new phase and near the mass market,” the report from T&E says.

Based on IHS Markit’s light vehicle production forecast data and in-house T&E analysis, the production of EVs in Europe is set to surge six-fold between 2019 and 2025, reaching more than 4 million cars and vans. This production volume would account more than a fifth of the EU car production volumes.

EV manufacturing will be replacing diesel-fueled car making across Europe, with the largest production sites in western Europe—Germany, France, Spain, and Italy, T&E’s analysis shows. In central and eastern Europe, Slovakia, the Czech Republic, and Hungary are also expected to be significant EV production centers.

EV production volumes forecasts for the UK are currently highly uncertain because electric car manufacturing growth could easily be reversed in a no-deal Brexit scenario, according to the analysis.  

All major European carmakers, including Germany’s Volkswagen, BMW, and Daimler, France’s PSA, and the Renault-Nissan-Mitsubishi alliance are expected to roll out a number of EVs in Europe. Fiat Chrysler, Ford, and Tesla will also offer new models in Europe by 2025, the report showed. Related: Gloomy Investor Sentiment Darkens Outlook For Oil & Gas

“Thanks to the EU car CO2 standards, Europe is about to see a wave of new, longer range, and more affordable electric cars hit the market. That is good news but the job is not yet done. We need governments to help roll out EV charging at home and at work, and we need changes to car taxation to make electric cars even more attractive than polluting diesels, petrols or poor plug-in hybrid vehicles,” Lucien Mathieu, transport and e-mobility analyst at T&E, said.

“This is a pivotal moment for Europe’s automotive industry,” Mathieu added, noting that carmakers are investing a combined US$163 billion (145 billion euro) in electrification, and “battery making is finally coming to Europe.”

“We need to send a clear signal to industry that there is no way back, and agree a phase-out of petrol and diesel car sales in cities, at national and EU level. The age of the combustion engine is coming to an end,” Mathieu concluded.  

Sales of EVs in Europe are growing, and the undisputed leader in terms of market penetration is Norway, which is not a member of the EU.

For the first time ever, EV sales in Norway in March outstripped sales of gasoline and diesel cars combined, confirming the Nordic country’s undisputed global leadership in EV market share. The nearly 60-percent record EV market share in March was driven by two key factors—Norway’s consistent government policies in incentivizing purchases of zero-emission cars and a record number of Tesla Model 3 deliveries in March.

Norway may have a population of just 5.3 million people, but it is an important market for all EV makers, especially for Tesla. This importance is also recognized by Elon Musk who retweeted with heart emoticons Norway’s sales numbers for March.  

In the United States, the absolute number of EV sales is still tiny compared to the overall market. Yet new registrations of fully EVs in the United States hit a record 208,000 cars in 2018, more than double the new registrations in 2017, IHS Markit said in an analysis earlier this year.

The EV market will grow in the United States and in the world, the analysis says, but adds that one thing is clear: “the internal combustion engine is not going away any time soon, with IHS Markit forecasters anticipating them to continue to dominate the global market until past 2030.”  

By Tsvetana Paraskova for Oilprice.com

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  • Mamdouh Salameh on July 21 2019 said:
    Don’t hold your breath. Moreover, don’t Judge the electric vehicles (EVs) market in Europe by Norway’s EV sales since Norway is one of Europe’s small economies.

    If new registrations of EVs in the United States reached 208,000 cars in 2018, EVs sold in Europe would have been far smaller, probably around 50,000 cars or less.

    Still, hardly a day goes by without another media report about the impending demise of the Internal Combustion Engine (ICE) as petroleum-powered cars and trucks are replaced by super-clean EVs.

    The media claims it is just a matter of time before EVs start to materially reduce global oil demand. They also claim that EVs are yet another reason why the decline of oil production and consumption is inevitable. Except it isn’t true.

    The reason is that there will neither be a post-oil era nor an imminent energy transition or a peak oil demand throughout the 21st century and probably far beyond.

    A post-oil era is a myth. Oil will continue to reign supreme throughout the 21st century and probably far beyond.

    A peak oil demand is another myth. While a wider use of EVs coupled with government environmental legislations could decelerate the demand for oil, EVs could never replace oil in global transport throughout the 21st century and far beyond.

    And with global oil consumption exceeding 100 million barrels a day (mbd), the notion of imminent energy transition looks like an illusion.

    Some experts are now saying that a widespread EV use could spell the end of oil. The tipping point, they reckon, is 50 million EVs on the roads. This they believe could be reached by 2024. However, 50 million EVs could hardly make a dent on the global demand for oil let alone replace it.

    Currently, electric and hybrid cars combined number under 4 million cars out of 1.477 bn ICEs on the roads worldwide in 2015, or a negligible 0.27%. The total number of ICEs is projected to reach 2.0 bn by 2025 rising to 2.79 bn by 2040 according to US Research.

    In 2018 the world used 36.4 bn barrels of oil (bb) of which 73% or 26.6 bb were used to power 1.477 billion conventional cars around the world. Bringing 50 million EVs on the roads will reduce the global oil demand by only 0.9 bb, or 3.4%. This will neither be the end of oil as some experts are suggesting nor a tipping point.

    A tipping point for oil could only be reached once 739 million EVs (50% of the current global ICEs number) are on the roads worldwide. This is impossible to achieve within that time frame. One then can only guess how many decades will have to pass before the entire global car fleet of ICEs is replaced by EVs.

    Moreover, growth in EV sales thus far has been supported by significant government subsidies. Sales would crash once the subsidies are withdrawn according to a report in April 2017 by US Auto research firm Edmunds.

    Furthermore, there will be a need for trillions of dollars of investment to expand the global electricity generation capacity in order to accommodate the extra electricity needed to recharge 50 million EVs. How could such expansion be sourced from: nuclear, hydrocarbons or solar?

    And despite a global expenditure of $ 3.0 trillion on renewable energy during the last decade according to the International Energy Agency (IEA), renewables accounted for only 4% of the global primary energy in 2018. This is a hefty price to pay just to gain only a percentage point of market share from coal.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London
  • Owen Morgan on July 22 2019 said:
    I was all with you until “the internal combustion engine is not going away any time soon". I am convinced that by 2013, new cars with an ICE will be impossible to sell, and people will practically be giving away used ICE cars. Once you have experienced how much better an electric car is to drive and the convenience of refueling at home while you sleep and for a fraction of the cost, nobody will want an ICE. All it takes is bums on seats. The ICE will be in the same class as a horse and buggy.
    By 1930, a car with an ICE will be a niche product, and at least 1/3 of today's car companies will probably be gone because they were unwilling or unable to adapt.
  • Owen Morgan on July 22 2019 said:
    I don't have time to address everything, but for personal transportation, the EV will take over quickly simply because it is superior technology. If you drive a modern EV once, you will be convinced. My neighbor is now buying one because he's seen how reliable and practical mine is. In 1 1/2 years of ownership, I have needed to charge away from home 5 times. My car loan is now what I used to pay for gas, my fuel cost is 1/8 of what it used to be. The main reason the EV transition is not happening faster is a lack of capacity to produce batteries. For shipping etc, the transition will be slower.

    The idea that we would need a massive expansion of the grid is a myth. 95% of EV charging happens at night at home. The grid has a large overcapacity at night. Furthermore, an increased demand for electricity is not an inconvenience for the utilities. They will be delighted to scale to meet demand for the product they sell. Much of any extra demand can be met with local generation from wind and solar with battery storage, both at individual homes and microgrids.
  • Ronald Wagner on July 22 2019 said:
    Salameh said all that needs to be said except that natural gas vehicles could take over whenever gasoline or diesel get too expensive. Do you realize that there are five times as many natural gas vehicles on the road as there are electric vehicles. They are far less expensive to produce and any ICE vehicle can be converted. That includes ships, locomotives, large trucks, pickup trucks and the smallest of vehicles.
  • Justin Smith on July 24 2019 said:
    Most people can’t comprehend the timeline for EV conversion.

    Here is the math. 1.25 billion vehicles on the road. About 4 million are EVs. By 2035 it is estimated there will be 2.0 billion vehicles in the world

    99 million cars produced last year, 49 million retired. 2 million of those were EV. EV has sustained 40% growth margins each of the last 4 years.

    So hypothetically assuming a continued 40% growth rate (this skips over a huge amount of upcoming issues around battery production, grid investment, societal change etc) it still means the ICE fleet will continue to grow until around 2030 (at which time EV production is more than 65 million a year).

    It will take until the late 2030s until the ICE fleet is the same size as today (if you do the math it peaks at around 1.65 million vehicles).

    Again this is the fastest transition possible at the near mythical annual 40% EV production increase. If this rate slips the changeover pushes out decades.
  • Michael Walker on July 26 2019 said:
    Appears to me that Dr. Salameh 's comments are back by data while opposing comments are are not. Wishful thinking is not scientific nor honest. It appears that ICE will be here (in majority) far beyond the age limits of opposing commenters (60 plus years).
  • rudolf d'Ecofacista on August 05 2019 said:
    So far,the only thing exploding in Europe are the batteries of electric vehicles

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