Between 2023 and 2025, electric vehicles (EVs) will reach the “tipping point” of rapid mass adoption. In 2020, global sales rose 43% compared to the year before. That growth is expected to accelerate as battery prices continue to fall, bringing the cost of EVs down to the equivalent of or below petrol and diesel models – even without subsidies.
McKinsey’s Global Energy Perspective 2021 predicts:
Electric vehicles are likely to become the most economical choice in the next five years in many parts of the world.
Norway has already passed the tipping point thanks to tax breaks making electric cars cheaper than gas-powered vehicles. The Nordic country’s market share of battery-powered vehicles reached 54% last year. In most other European nations, that figure is still less than 5%.
Professor Tim Lenton of the University of Exeter explained:
There’s been a tipping point in one country, Norway, and that’s thanks to some clever and progressive tax incentives. Then consumers voted with their wallets.
According to Lenton’s latest study findings, EVs in Norway were 0.3% cheaper and had a 48% market share in 2019. However, in the UK, where EVs were 1.3% more expensive, the market share was just 1.6%.
Lenton said:
Once the line of price parity was crossed, bang – sales go up. We were really struck by how non-linear the effect seems to be.
While Lenton predicts lithium-ion battery costs will fall enough that EVs will match petrol and diesel cars’ prices by 2024-2025, BloombergNEF’s analysis suggests it could be as early as 2023.
Although, as of last year only 4,2% of new cars were electric. But moves like President Joe Biden vowing to swap the entire government fleet of vehicles and trucks to electric models should help us reach the tipping point faster.
James Frith, BloombergNEF’s head of energy storage, said:
Government grants and tax breaks have cut the cost of electric cars in some countries, but the point when they become cheaper without subsidies is key. That’s definitely an inflection point. [Then] we really see the adoption of electric vehicles taking off and real market penetration.
A poll by the RAC surveying 3,000 UK drivers found that 78% of motorists think EVs are still too expensive compared with petrol and diesel cars, and only 9% say their next car would be electric. The survey highlights the importance of prices.
Rod Dennis of the RAC said:
The single biggest barrier to a driver choosing an electric car has to be cost.
EVs are vital in tackling the climate crisis because transportation is a significant source of carbon emissions. Unfortunately, two factors hold them back from mass uptake: their higher purchase price and “range anxiety.” But both those issues have solutions on the horizon. There’s even been news about five-minute-charge batteries to be produced in a factory for the first time.
And solid-state batteries – another next-generation technology enabling ultra-fast charging – could enter the mass market by the end of the decade. Toyota claims they’ll have EVs equipped with solid-state batteries by as early as 2025, with prototypes set to debut this year.
BloombergNEF forecasts average prices to be around $60/kWh by 2030, thanks to all these new battery technologies.
Frith said:
It is an incredibly exciting time. We see so much innovation coming from all areas, whether industry or research, and so much money being poured in by governments and everyone, that it seems like there will be a lot of changes to come, and it’ll just get more exciting.
Another recent poll by Zap-Map of 2,000 electric car owners found that 91% said they would not want to return to a petrol or diesel vehicle.
Melanie Shufflebotham, from Zap-Map, a company that maps charging points, said:
The poll shows the strong and enduring impact of switching to a clean car. The evidence in favor of electric vehicles grows more compelling with each one of our surveys, even in a year as disruptive as 2020.
EVs have faster acceleration, they’re quieter, and they’re clear – what’s not to love?
