Worldwide Surge in the Sales of Electric Vehicles
Posted on July 30, 2017
Half a decade ago, electric vehicles (EVs) made their appearance, born out of the necessity to reduce CO2 emissions, the prospect of fossil fuels running out and the will to reduce dependency on countries producing crude oil.
Like many new technologies in their infancy, the sales price of electric cars was, at first, too high for them to become a mass-market success overnight, and they were more of a rarity owned by people with significant money to spare. In addition, their very limited autonomy range didn’t make them an attractive everyday car.
Five years later, the picture couldn’t be more different.
Tesla, which was founded to develop an all-electric sports car, went from being a ‘quirky’ car manufacturer to being the new cool kid on the block that everybody wanted to talk to. They stopped producing their roadster in 2012 to concentre on road cars. Their Model S sedan was born and has been widely praised for its performance and design. It has also been the best-selling plug-in electric cars for two consecutive years, in 2015 and 2016, and became the world's all-time second best-selling electric car in December 2016.
The company has since then released Model X and Model 3 and has several other cars in the pipeline, and it is very clear that they aren’t going anywhere.
The traditional car manufacturers now all have a few electric cars in their catalogue, either hybrid or plug-in models. Volkswagen, the world’s largest automobile producer, plans to launch four affordable EVs over the next few years and Mercedes-Benz intends to take on Tesla with the release of ten new electric vehicles by 2022.
In addition, demand for diesel cars has fallen sharply after Volkswagen admitted to falsifying emission test results.
The International Energy Agency in Paris, France, an independent organisation dedicated to ‘reliable, affordable and clean energy’ for its country members, published in 2016 a report on the sales of electric vehicles that confirmed the acceptance of electric cars by the public.
It revealed that the number of electric vehicles worldwide had ‘rocketed’ over the last five years. This statement has to be put in perspective though, as we are talking of sales reaching a couple of millions, which represents only 0.2% of all cars in circulation worldwide.
However, this is an encouraging sign of the progress of electric cars if you consider that this number amounts to a rise of 60% between 2015 and 2016. Norway is clearly leading the way with a 29% market share. Far behind are the Netherlands, with 6.4% and Sweden with 3.4%. It is followed by France, China and the UK, with China accounting for 40% of all electric vehicles sold in the world in 2016, twice the amount sold in the US.
Although those are very positive figures, it has to be said, disappointingly, that sales of EVs are very much stimulated by government policy, and falter has soon as that support is withdrawn.
In the Netherlands, for example, when tax incentives previously available for plug-in hybrid electric vehicles were phased out, their sales fell by 50%. In Denmark, when registration taxes for electric vehicles were reinstated after years of exemption, the country saw a 68% drop in their sales number.
This illustrates how the adoption of electric vehicles is far from being a given and needs to be supported by governments all around the world, which is what The Electric Vehicle Initiative is about.
An inter-government organisation, it aims to develop policies to support the penetration of electric cars, buses, vans and trucks in its fourteen member countries: Canada, China, Finland, France, Germany, India, Japan, Korea, Mexico, Norway, South Africa, Sweden the UK and US. Its goal is to have 20 million EVs on the road by 2020 and to reach 30% market share by 2030 and, at the Marrakech Climate Change Conference in November 2016, the members, with the exception of Finland, Germany, India, Korea, Mexico and South Africa, signed a Fleet Declaration pledging to increase the number of electric vehicles they use in their government fleets.
The role of the Electric Vehicle Initiative is to facilitate cooperation between the participant members and policy implementation at a national level. They will encourage best practices to reach the organisation’s voluntary targets and lead cities to share experiences from deploying EVs in urban areas where they are at the most efficient fuelwise. It will also promote information sharing between members on public investment in R&D to ensure that technological gaps are addressed.
In our part of the world, the landscape is quite different.
In Australia, there is no direct incentive to encourage the purchase of electric vehicles; there is even a financial disadvantage as a Federal Luxury Car Tax is applied on new fuel-efficient vehicles valued over A$75,375 (in 2014-15). In New Zealand, the government announced that electric vehicles would be exempt from Road User Charges but would still be liable to GST and those measures to support the adoption of electric cars have been widely criticised as ineffectual.
On 5 October 2016, the Paris Agreement on climate change set a global target of below 2˚C in temperature rise. Transportation has always been one of the major contributors to global warming, and to reach that number, the world would need 600 million electric vehicles on the roads by 2040, according to The International Energy Agency, so governments have their work cut out. However, electric vehicles are more than about reducing the emission of greenhouse gases, it is also an important step towards improving air quality and health issues connected to it, and increasing independence from oil-producing countries which have been at the centre of political instability over the last couple of decades.
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