Electric Vehicle Sales Set to Soar in 2025
A New Era of Electrification
The electric vehicle (EV) market is poised for significant growth in 2025, with global sales expected to surge by at least 17% to over 20 million cars. According to research firm Rho Motion, this upward trend is driven by the extension of China’s auto trade-in subsidies and the introduction of new CO2 emission targets in Europe.
Europe’s EV Market: A Return to Growth
After a brief slowdown, Europe’s EV market is expected to return to sales growth in 2025. The introduction of cheaper models and stricter emission targets will drive demand, although the pace of growth will remain slower than in 2023. Rho Motion Head of Research, Iola Hughes, notes that car makers are looking to 2025 as a transformative year for EV adoption.
China’s Dominance Continues
China, the world’s largest EV market, will see sales rise even higher than previously forecast, thanks to the extension of subsidies. In 2024, EV sales in China jumped by a record 40% to 11 million. Chinese-made EVs will continue to dominate markets in Latin America, the Asia-Pacific region, and emerging markets.
The US Market: A Mixed Bag
In the US, EV sales are expected to grow by 16% in 2025, despite limited impact from policy changes under the Trump administration. However, Rho Motion warns that these changes could have long-term consequences, including a potential 47% drop in EV battery demand by 2040. Hughes notes that while uncertainty has hit the US market, the shift to electric vehicles is still underway and will continue to grow over the next decade.
The Cost of Missing Emission Targets
Carmakers in Europe still risk significant fines for missing EU emission targets, despite buying credits from EV makers through pools. Rho Motion estimates that these fines could total around 10 billion euros ($10.51 billion), down from previous estimates of 15 billion euros.
A Decade of Growth Ahead
Despite challenges and uncertainties, the electric vehicle market is poised for significant growth over the next decade. As governments around the world introduce stricter emission targets and incentives, car makers are investing heavily in EV technology. With sales expected to continue rising, the future of electric vehicles looks bright.
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