As electrification and decarbonisation continue at pace, the electric vehicle market has continued to grow rapidly, gaining swift momentum as charging infrastructure and government rebates expand.
The uptake of battery electric vehicles (BEV) is expected to continue to increase this year, forecast to reach 13.3 million units and accounting for about 16.2% of passenger vehicle sales, compared to 12% and 9.5 million units last year.
While a 4% increase might appear modest at first, the true story lies in the massive increase in sales expected in the US and Europe, which are likely to grow by 66.4% and 41% respectively year-on-year.
The progress in Australia has also been strong – sales of BEVs rose to 8.4% of new car sales in the first half of 2023, compared to just 3.8% in 2022, a more than 50% jump.
Supply constraints easing
The car market took an interesting turn during the COVID-19 pandemic, as supply between countries became almost non-existent and used cars skyrocketed in value.
Car prices are now returning to pre-pandemic norms as supply chain issues are resolved and semiconductor shortages ease, helped along by Tesla (NASDAQ:TSLA) slashing its prices to remain competitive.
Consumer sentiment also seems to be shifting – a survey conducted last year indicated 42% of Australians said they would buy an EV next time they buy a car.
Business fleet uptake
Importantly, businesses and institutions are gearing up to claim their own market shares – significant given business fleet sales account for about half of all new car sales in Australia.
More than half of Australian businesses have indicated they intend to replace their petrol cars with EVs in the next two years, energy management firm Schneider Electric (EPA:SCHN) revealed as part of its third annual sustainability study.
“(Electric fleets) are revving up and businesses are aware of what they need to do,” Schneider Electric home and distribution vice-president Chris Kerr said.
“The upwards curve has been super surprising over the past month and I think it’s happening quicker than everybody thinks,” Kerr told the Australian Associated Press.
“It’s going to be even more dramatic going forward.”