Nearly one in five cars sold globally this year will be electric, with the prices of smaller EV models dropping to rival those of combustion engine cars in North America and Europe by the mid-2020s, the International Energy Agency (IEA) predicted on Wednesday.
The agency raised its EV sales forecasts in part because of the US Inflation Reduction Act, which supports green industry and subsidises consumers’ purchase of electric vehicles (EVs), IEA Executive Director Fatih Birol said.
China features prominently, making up half the EVs on the road worldwide including battery-electric cars and plug-in hybrids, and with 60% of EV sales last year taking place there, according to the IEA.
The country has also seen prices for some smaller EV models edging lower towards those of their combustion engine equivalents, said the IEA’s Timar Guell.
Electric car sales globally are expected to surge 35% this year to 14 million, the report said, comprising 18% of the passenger car market, up from just 4% in 2020. Governments are investing in EV expansion for the environment and to decrease dependency on oil, demand for which will fall by 5 million barrels a day by 2030 because of the EV transition, Birol said.
