Electric vehicles (EVs) have surpassed at least 5% of new car sales in 23 countries, according to a recent report from Bloomberg.
Much of the surge in EV sales occurred last year, according to the report. Five more countries now have 5% EV sales (considered a tipping point for mass adoption) than a year ago. Average EV sales increased by 55% in the last quarter compared to the same period the previous year, the report states.
Newcomers such as Canada, Australia, Spain, Thailand, and Hungary join the ranks of the United States, China, and most of Western Europe. India, the third-largest automotive market after China and the United States, recorded 3% EV sales in the last quarter, doubling in just six months, as noted by Bloomberg. Therefore, it could be the next country to cross the threshold.
The 5% threshold is where EV sales will truly take off, predicts Bloomberg. This is based on the assumption that EVs will follow the same S-curve adoption pattern as other technologies like televisions and mobile phones. In this scenario, adoption initially progresses slowly, accelerates, and then slows down again as the market approaches saturation. This seems to be the case in Norway, which led the world in EV adoption, reaching 80% of EV sales, but where sales growth now appears to be slowing down.
The United States reached the 5% threshold in 2021, quite late for a country with such purchasing power. EV adoption varies by region in the U.S., lagging in the central part of the country but increasing in a handful of states, led by California. EV sales accounted for 15% of the vehicle market in California last year.
In the United States, cost is a critical barrier, especially as EVs continue to move upmarket with larger and longer-range battery packs. Any sales growth also requires greater exponential growth in public charging infrastructure due to several factors. As Bloomberg points out, the Biden administration has focused on EV adoption with funding for charging infrastructure and a reinstated tax credit for EVs, but these efforts may not be sustained by a potential future Republican administration.
