By 2040, just 38% of the automotive market will be made up of battery electric vehicles (BEVs). The problem is, this number needs to hit at least 65% in order to reach net-zero targets.
The above infographic sponsored by KGP Auto explores this theory further, and breaks down some of the key reasons why the EV market needs to urgently shift gears in order to make mass adoption a reality. First, let’s take a bird’s eye view of the market for context.
In 2021, global electric vehicle sales doubled—however some regions contributed a lot more than others.
China, Europe, and the U.S. made up nearly two-thirds of the EV market and 95% of total electric car sales in 2021. In fact, China sold more electric cars in 2021 than the rest of the world combined in 2020.
Global forecasts for EV rollouts vary, with countries around the world pledging targets for 2035 and 2040. At The UN Climate Change Conference (COP26), more than 100 stakeholders signed a declaration to speed up the transition to 100% zero emission cars and vans by 2035-2040.
Even as pledges vow to increase the forecast share of EV adoption, we still need to consider headwinds that will slow down the EV rollout.
Roadblock 1: Resource Constraints
Sourcing critical raw materials will be the most significant challenge for the rollout of EVs, as demand outstrips supply.
Although some areas of the EV production line can be fast-tracked, mineral extraction times cannot, which will cause major setbacks to EV production. In fact, it can take anywhere from 4-20 years for a mine to begin commercial production.
In addition to the time taken to achieve commercial production levels, a mine can take up to another 10 years before reaching nameplate production capacity.
Roadblock 2: Cost
Although EVs are becoming more affordable, purchase price remains high in emerging markets, limiting mass adoption.
Many countries have been slower to incorporate EVs into their automotive fleets, with India, Brazil, and Indonesia making up less than 0.5% of global electric vehicle sales in 2021.
A continued increase in the cost of raw materials as well as global interest rate rises may also contribute to limited affordability and slow mass adoption.
Roadblock 3: Infrastructure
Charging infrastructure also varies across markets, with France, Germany, and the UK currently not meeting EU charger availability recommendations.
Providing enough charging infrastructure will be especially difficult in emerging markets.
While the rollout of EVs is underway, the momentum needed to reach net-zero targets will be slowed by resource constraints, cost, and infrastructure. It’s therefore essential we consider all paths to decarbonizing the auto industry.
Alternative solutions such as a fuel-mix strategy laid out in KGP Auto’s new report could sustain momentum to net-zero targets, with internal combustion engines (ICEs) continuing to make up the majority of market share for the next few decades.
In this strategy, ICEs, plug-in hybrid vehicles (PHEVs), and fuel cell electric vehicles (FCEVs) with alternate fuels such as hydrogen would bridge the gap to net-zero targets as raw-material supply, infrastructure, and affordability improve to support BEVs.