The car industry is undergoing a radical transformation, with most carmakers agreeing the next 10 years will bring more change than the two previous decades.
The next target date cited by automakers as a tipping point is 2025, when everything from materials and fuel to cost and the companies that build cars are set to look dramatically different. In this report, the J.P.
Morgan Research team explores the rise of the electric vehicle and what the industry will look like by 2025.
Shifting Gears to Electric Vehicles
Automakers are preparing to phase out cars powered solely by internal combustion engines (ICEs) as governments look to tackle fuel emissions. The growth in electric vehicles (EVs) and hybrid electric vehicles (HEVs) is climbing and by 2025, EVs and HEVs will account for an estimated 30% of all vehicle sales. Comparatively, in 2016 just under 1 million vehicles or 1% of global auto sales came from plug-in electric vehicles (PEVs).1
By 2025, J.P.
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Morgan estimates this will rise close to 8.4 million vehicles or a 7.7% market share. While this jump is significant, it doesn’t compare to the kind of growth expected in HEVs - cars that combine a fuel engine with electric elements.
This sector is forecast to swell from just 3% of global market share to more than 25 million vehicles or 23% of global sales over the same period.1 This leaves pure-ICE vehicles with around 70% of the market share in 2025, with this falling to around 40% by 2030, predominantly in emerging markets.
The EV Dictionary
EV: Electric vehicle, including BEV, PHEV, FCEV & HEV
BEV: Battery electric vehicle
HEV: Hybrid electric vehicle
FCEV: Fuel cell electric vehicle
ICE: Internal combustion engine
NEV: New electric vehicle (BEV & PHEV)
PEV: Plug-in electric vehicle (BEV & PHEV)
PHEV: Plug-in hybrid electric vehicle
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