Charged Up! EV Sales to Hit One Million Per Month Mark Soon

After a record-setting milestone of electric vehicles sales, almost doubling in 2021 to 6.6 million compared to 3 million of a year earlier, a more ambitious question emerges. When will the EV sales hit a million per month milestone?

The year 2021 was the harbinger for electric vehicles. The market hit an all time high in sales for any year. Statistically, the last month of December was quite exceptional. Electric cars sales raised exponentially to 907,000 from 720,000 a month earlier, contributing 11% of total sales globally! At that rate, we might hit the million per month mark as early as the first or second quarter of the 2022 calendar year!

Hitting 1 million per month

The target seems quite ambitious considering that it was only in 2017 that the global sales crossed the one-million mark for yearly sales. To understand the significance of the target, in 2012, only about 130,000 total electric cars were sold worldwide. These are lower than the weekly sales in the present scenario.

Looking at the monthly sales trajectory in 2021, the target no longer seems distant. The total global sales stood slightly above 300,000 in January. By July, it just shied of 600,000, only to hit a momentous 900,000 mark by December 2021, a record sales month. Extrapolating based on this trend, it is most likely to reach a million per month mark roughly by March 2022. And if that isn’t enough, we will probably see 2023 as the first year with sales at over a million vehicles sold in every month of the year.

Performance of Leading EV Markets

The developments can be seen in a broader view by observing the major players in the EV sector.  Nearly 3.4 million electric vehicles (tripled from a year earlier) were sold in 2021 in China alone, more than the entire global sales of 2020.

Europe’s annual electric car sales increased by nearly 70% in 2021 to 2.3 million. The year-on-year growth was lower than 2020, yet this was impressive looking at the pandemic-driven economic slump of an overall European automotive market, which means EV’s actually increased their share. The growth is partially due to new CO₂ emissions standards on the continent. The sales in December, for the first time surpassed that of diesel vehicles. Expectedly, the countries with largest market share, in Europe in last year were Germany (25%), the United Kingdom and France (both around 15%), Italy (8.8%) and Spain (6.5%). And then of course we have outliers like Norway where EV share of new sales is over 80% now, even as ICE vehicles are set to stop selling by 2025.

In United States, crossing 500,000, sales more than doubled in 2021, a share of 4.5 percent of the total. Although more than half the electric car market is still dominated by Tesla, its total share in the market declined.

China, Europe, and the United States account for roughly two-thirds of the overall car market, yet they constitute around a staggering 90% of electric car sales. Contrastingly, in large developing economies such as Brazil, India, and Indonesia, the share is still below 1 percent.

In the last few years, various governments have set their targets of phasing out sales of internal combustion engine cars within the next two decades, a trend followed by many major car manufacturers.

• US government announced 50% electrification target for new cars, supported by 500,000 charging stations, by 2030.
• EU proposed to bring down CO₂ emission standard for new cars to zero by 2035.
• VW group said that half of its sales would be electric by 2030.
• Ford also joined the current by expectations of 40-50 percent of the total sales as electric by 2030.
• Toyota, the largest car manufacturer in the world, aimed electric car sales of 3.5 million a year by 2030.
• India itself is seeking a 30% share in all new sales for EV’s by 2030.

Challenges to EV Growth

Government policies remained the key driving force behind the emergence of the electric vehicle as one of the fastest-growing industries worldwide. Various challenges, mostly from supply side, hinder the growth of the industry to hit the said targets, or even transgress them.

• The bulk material prices, (steel, aluminum, copper, etc.) are increasing for the entire auto industry. In addition to these, electric cars faced price rise in battery production due to the well reported issues around Lithium ion batteries.
• Microchip shortages have affected the EV markets worldwide as they require around twice as many chips as conventional vehicles.
• The demand is increasing for EV much faster than the present supply. To keep up the pace is a prerequisite to EV growth.
• Limited driving range before a charge is needed.

While the year 2019 saw total EV sales of 2.2 million, the year 2020 witnessed remarkable growth as EV sales hit roughly 3 million. Surprisingly, it was the same year when the pandemic led to an overall contraction in global car sales, yet EV sales flourished. A year later, in 2021, the sales almost doubled to 6.6 million.

The numbers themselves are quite fascinating. Yet the proportions of EV sales as a total share in the global car market raised eyebrows. In 2019 the EV sales represented 2.5 percent of total car sales. This was 4.1 percent and 9 percent for the years 2020 and 2021, respectively. Interestingly, all the net growth in car market came from EV sales alone in 2021.