Global Electric Vehicle Sales to Surge in 2020s: Wood Mackenzie

The electric vehicle sector requires external support to become competitive and while its market share is small, WoodMac expects a decade of growth

Electric Vehicle

Despite the electrification movement growing in popularity, Electric Vehicles (EVs) accounted for 3 percent of all vehicle sales and represented only 0.5 percent of all vehicles on the road in 2019. The industry is still in its infancy and the electric vehicle sector requires external support to become competitive. While the sector’s market share is small, Wood Mackenzie expects the 2020s to be a decade of EV growth.

The base case scenario sees the global EV market share increase from 3 percent in 2019 to 14 percent by the end of the decade. Within the same timeframe, the share of full hybrids will climb from 4 percent to 9 percent, while the penetration of gasoline engine vehicles is expected to fall from 79 percent to 66 percent.

This will have a ripple effect on many other industries. According to our projections, demand for global petroleum products will fall by 1 million barrels a day from the impact of EV growth alone.

“We also expect automotive batteries to form the bulk of global battery metals demand, including lithium (69 percent) and cobalt (46 percent). The need for charging infrastructure is expected to create new industries for installing and maintaining charging stations,” said Ram Chandrasekaran, Wood Mackenzie Principal Analyst.

While the focus of the previous decade was on cost and range, the coming decade will see an emphasis on energy density and charging capacity.

“With one of the most advanced battery packs in the automotive industry, the Tesla Model 3 pack has an energy density of 160 Wh/kg. The 75 kWh pack weighs approximately 480 kg, representing about a quarter of the vehicle’s weight. An increase in energy density reduces the weight of the battery and thus the vehicle. This reduces the total pack size needed to achieve the target range, in turn reducing the weight of the battery further. This spiralling effect is unique to BEVs,” added Chandrasekaran.

According to the analysis, the energy density of lithium-ion batteries is projected to rise 25-35 percent depending on specific chemistry used over the next decade. This is before accounting for next-generation technologies, such as solid-state and lithium-sulfur batteries. The increase in vehicle efficiency from these changes, combined with the projected decrease in pack costs, will lead to a marked decline in BEV price at the point of sale.

A combination of significantly improved energy density and a network of high-capacity public fast-charging stations has the potential to catapult BEV adoption from the projected 14 percent to 30-40 percent, the analysis added.

Ayush Verma

Ayush Verma

Ayush is a staff writer at saurenergy.com and writes on renewable energy with a special focus on solar and wind. Prior to this, as an engineering graduate trying to find his niche in the energy journalism segment, he worked as a correspondent for iamrenew.com.

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