China Gains EV market share in Thailand, Brazil amid US policy lag

Growth Of EV Market Highest In China, EU, Says WRI Report

BloombergNEF’s annual Electric Vehicle Outlook (EVO) expects nearly 22 million battery electric and plug-in hybrid vehicle sales this year, up 25% from 2024. It associates the rise in sales with a drop in lithium-ion battery cost and with the increase in production of more affordable EV models, ramp-up. China currently accounts for nearly two-thirds of those sales, according to the report, followed by Europe at 17% and the US at 7%. Further, plug-in electric vehicles are set to account for one in four vehicles sold globally this year, a remarkable growth from just a few years ago when less than 5% of global vehicle sales were electric vehicles.

The report showed that. China extended its lead over Europe and the US due to EVs are, on average, cheaper to buy than comparable ICE vehicles. Demonstrating China’s dominance further, the report finds that 69% of EVs sold globally in 2024 were manufactured in China, with Chinese automakers having a major presence in EV sales in emerging markets like Thailand and Brazil. These sales, paired with an evolving policy landscape in the US, have put adoption in some emerging markets, like Thailand, higher than in the US, challenging the widely held assumption that EVs will start in wealthy countries before spreading further. Outside of China, the UK leads among major car markets and holds the top spot for EV adoption among large countries in Europe, ahead of Germany.

BNEF Reduced Passenger EV Adoption Outlook

Despite the global growth of EV sales, BNEF has reduced its long-term and short-term passenger EV adoption outlook for the first time, largely due to the various policy changes in the US. While passenger EV sales in the US are still projected to rise – from 1.6 million in 2025 to 4.1 million in 2030 – the revised outlook falls short of previous BNEF projections, resulting in 14 million fewer cumulative EV sales over that period.

Drawing on BNEF’s team of sectoral and regional experts globally, the report presents two updated road transport scenarios. In the base case Economic Transition Scenario (ETS) – in which EV adoption is shaped by current techno-economic trends and with no new policy intervention – EVs reach 56% of global passenger vehicle sales by 2035 and 70% by 2040, down from 73% in the previous outlook. Despite rapid EV adoption, only 40% of the global passenger-vehicle fleet is electric by 2040 in the ETS, far below what is required to keep road transport emissions on track for the Net Zero Scenario.

BESS Lower Than Before

The report finds that while battery demand for EVs is still growing, it is lower than in previous outlooks. BNEF’s battery demand outlook between 2025 and 2035 fell 8% compared to last year’s, equating to 3.4 terawatt-hours fewer batteries – a majority of which (2.8TWh) can be attributed to decreasing passenger EV sales in the US. This dynamic is leading to continued overcapacity, driving battery costs lower and intensifying market competition. In China, the average utilization of battery plants is now below 50%. Despite a near-term slowdown, the long-term growth for battery metals remains strong as EVs are adopted more quickly across all segments.

EV Charging Stations Face Challenge

The cost of public EV charging, according to the report, also poses a challenge to widespread EV adoption. It found that, Public fast charging prices have risen sharply since 2022, especially in the US and Europe, pushing costs per kilometer above gasoline in some cases. As a result, refueling costs are expected to have a growing impact on EV adoption and price parity between EVs and ICE vehicles past the point of sale over time.

Other key findings

The report also showed, “Solid-state batteries are now being commercialized and are expected to account for 10% of global EV and energy storage battery demand by 2035. These next-generation batteries offer significant advantages in safety and energy density and are expected to be deployed in high-performance, premium vehicles first. Manufacturers have announced over 830 gigawatt-hours of annual solid-state battery capacity, but only 9.5% of this has been commissioned, and most of this is semi-solid-state technology.”

Conclusion

One could argue that China might have done no good to its cause with the restrictions on rare earth magnets, that is set to hit EV production in many markets including India. Would these countries be more receptive, or trusting of Chinese imports in the future? Big question. Further, the drop in predicted battery demand might be compensated from higher than expected stationary storage demand, although the Chinese shadow of high control over supply chains looms here as well. In effect, what the report doesn’t say is that for all the Chinese claims of being a leader in the green transition, the unwelcome condition seems to be, as long as you buy from China. That is simply unsustainable, and China might have done singular damage to undo the years of positive contribution it made to the cause. Unless of course, it never actually believed in the cause, just the business opportunity it offered.