Electric vehicles are set to overtake internal combustion engine (ICE) sales worldwide as trends towards their uptake indicate that regulation alongside growing sustainability efforts will make them a favorable choice amongst OEMs and consumers. IDTechEx’s report, “Plug-in Hybrid and Battery Electric Cars 2025-2045: Technologies, Players, Regulations, Market Forecasts”, explores the possibility of 2025 bringing about new opportunities to resume steady market growth after a period of slower growth.
Recent EV figures and stricter regulations
With approximately 90 million vehicles sold worldwide in 2023, the car market is the biggest transport sector. 14.4 million electric vehicle sales were made in 2023, jumping to 18.1 million in 2024, highlighting a fast-growing market with scope for EV manufacturers to continue to establish themselves further.
The desirability for EVs is further amplified by the growing awareness of sustainable technologies, as explored in IDTechEx’s sustainability report portfolio, and the different regulations across numerous economies pushing to reach net zero. In the EU, 2035 will bring about an ICE ban, with a tightening of regulations seen in 2025 and then in 2030. Many companies are likely to, therefore, improve EV sales to avoid fines.
Battery electric vehicles (BEVs) are the best solution to reducing carbon emissions across the transport sector due to them producing zero tailpipe emissions, and their presence is already well-established. BEV production is also largely responsible for contributing to the demand for lithium-ion batteries, electric motors, and power electronics.
Trends for the future of the EV market
IDTechEx’s report covers some of the ongoing trends that can be expected to be seen from 2025 and beyond, such as lower-cost models beginning to emerge and EVs entering the mass market. So far, electric vehicles outside of China have mostly been in the premium luxury segment, according to IDTechEx, but with regulation dates getting closer, the landscape is likely to change. This will also be made more of a possibility as battery and production costs stabilize, allowing vehicle prices to follow.
Charging infrastructure for BEVs and PHEVs is still somewhat limited, though it is definitely growing and becoming more widespread to accommodate the rise of EVs on the road. In 2023, IDTechEx reports that there were almost 4 million public charging points worldwide, with 1.2 million installed the same year. Approximately 219 million will be necessary by 2035 to meet the demands of growing numbers of electric vehicles. Global investments into charging infrastructure goals are expected to exceed US$104 billion by 2035, highlighting the worldwide interest in enabling the growth of these vehicles.
PHEVs are currently seeing an increase in popularity, which IDTechEx suggests could be down to the lack of charging infrastructure due to the need for security amongst consumers when switching to electric and the potential unavailability of charging points. However even these vehicles will eventually be replaced by BEVs in line with regulations and restrictions for tailpipe emissions.
IDTechEx’s outlook for EVs and manufacturers
PHEVs have particularly seen a huge uptake in China, the largest market for EVs globally, while electric pickup trucks in the US are beginning to see adoption, showcasing sustainable swaps already being made and paving the way for electric vehicle adoption to become normalized. Manufacturers are also going to be required to increase their EV shares over the next ten years, particularly in Europe. This may be done somewhat reluctantly due to the initial potential for a decrease in profits, though it will be necessary for economies to reach decreased carbon emission goals.
