It’s been a game changing year for the electric vehicles market. In Europe, electric cars sales are a whopping 85 percent higher than they were at this time last year--and that’s not even the region with the biggest growth. The EV revolution this year is taking place not in eco-friendly Europe, nor in technology-hungry China, but in Latin America, where electric vehicle sales for 2018 are up by a staggering 90 percent.
While the overall size of the Latin American EV market is still much, much smaller than those of East Asia and Europe, its rapid growth shows promise for what could soon represent a considerable market share. According to Bloomberg New Energy Finance (BNEF), as quoted by Forbes, “While the LatAm EV market is far smaller than East Asia, Europe and North America, accounting for less than 1 percent of global EV sales in 2018, it is starting to grow thanks to a handful of incentives and targets.”
“Mexico accounted for nearly half the growth.” according to Forbes, “alongside a strong showing from Colombia and Costa Rica.” In Mexico, “sales of hybrids, plug-in hybrids and EVs rose 68 percent in the first 10 months of 2018, to nearly 14,000 vehicles, according to the latest figures from the Mexican Automotive Industry Association” reports Automotive News in an article titled “A green-car market blossoms in Mexico.” In Mexico, a massive automotive market, consumers have been pushed toward electric vehicles thanks to gasoline shortages and price hikes in the past few years.
Mexico has quickly risen from a country where the Prius flopped in its initial introduction to the market there, to one of the strongest EV markets in the world. “Mexico is the fourth-biggest global market for the Prius, with 2016 sales of 4,265 units through September,” says Automotive News in its story “How the Prius rebounded in Mexico.” “That's well ahead of Toyota's full-year goal of 2,600 units, which already would have been an 80 percent increase from 2015.” Related: Shale Boom Reshuffles Global Top 50 Oil & Gas List
BNEF’s recently released Electric Vehicle Outlook 2019 says that they expect growth in Latin America and around the world to continue accelerating over the next couple of decades. Latin America is just one part of a global EV revolution. This year, more than 2 million electric vehicles were sold, an extremely significant figure when taking into account that less than a decade ago, total sales around the globe amounted to only a few thousand. “We expect annual passenger EV sales to rise to 10 million in 2025, 28 million in 2030 and 56 million by 2040,” the report says of the Latin American sector.
Forbes suggests that these findings from BNEF may even be on the conservative end of the spectrum. “While there are those that expect to see the speed of take-up to accelerate more rapidly,” says Forbers, “the BNEF projections suggest that by 2040 nearly 60 percent of all passenger vehicle sales and over 30 percent of the global passenger vehicle fleet will all be electric.”
One of the major factors leading to this global electric vehicle revolution is that the batteries used to power EVs are becoming more and more affordable. Once prohibitively expensive, the highly specially batteries have fallen in price so significantly that the BNEF expects “price parity between EVs and internal combustion vehicles (ICE) by the mid-2020s in most segments, though there is wide variation between geographies and vehicle segments.”
As a result, BNEF has increased their predictions for the number of electric vehicles they expect to be on the road by 2040. They say, “We now expect there to be 508 million passenger EVs on the road globally by 2040 (slightly less than the 559 million we forecasted last year). Including commercial EVs, this brings our 2040 EV fleet size forecast to about 550 million.”
By Haley Zaremba for Oilprice.com
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