In a major step a new reports suggests global sales of petrol and diesel cars may have already passed their peak, and in their place electric vehicles (EVs) will soon start dominating car, bus and van markets.
If correct that would pave the way for zero emission technologies to make similarly significant in-roads into the market for heavy goods vehicles (HGVs).
Those are the surprising conclusions of BloombergNEF’s (BNEF) latest annual Electric Vehicle Market Outlook, which for the first time incorporates not only data on cars and buses, but more detailed work on the commercial market for vans, medium-sized trucks and HGVs.
The report, just published, expects EVs to make up 57 per cent of global sales by 2040, a slight increase on its 55 per cent forecast last year.
Meanwhile, electric buses are set to secure an overwhelming 81 per cent of bus sales worldwide by the same date.
BNEF’s latest forecasts, while slightly more stronger, are not hugely different from last year’s, and some commentators have argued exponential increases in demand could see EVs dominate key markets far earlier than 2040.
However, the new projections nevertheless demonstrate growing confidence that the EV market is poised for rapid and sustained growth.
BNEF argued that growing consumer acceptance and downward pressure on technology costs, could see electric car sales rise from two million worldwide in 2018 to 28 million in 2030 and 56 million by 2040.
In contrast, fossil fuel car sales would fall to 42 million by 2040, from around 85 million last year.
It is also worth noting these global figures masks potentially vast regional variation in EV uptake, particularly given there is growing pressure on governments such as the United Kingdom’s to ban fossil fuel car sales altogether far earlier than 2040 in order to reach climate targets and make the most of new market opportunities.
BNEF forecasts that while China will continue to dominate global EV sales with 48 per cent of the market in 2025, Europe is on course to make significant gains, overtaking the United States as the number two EV market globally during the next decade.
Electrification elsewhere, meanwhile, will be much slower, leading to a much more “fragmented” global vehicle market, it states.
BNEF also has a notably strong outlook for decarbonising larger commercial vehicles, which are widely seen as far more of a challenge to electrify.
A number of companies are rushing to develop zero emission trucks, but they are yet to match the success of the electric bus market where orders are growing rapidly.
BNEF’s projections show electric models taking 56 per cent of light commercial vehicle sales, which are, broadly speaking, vans, in Europe, the US and China within the next two decades, plus 31 per cent of the market for medium commercial vehicles, or smaller trucks.
Even for heavy-duty trucks, or HGVs, the hardest segment for electric drive trains to crack due to the size and weight of such vehicles, electric alternatives could make up 19 per cent of sales globally in 2040, it estimates.
These EV sales will largely for be shorter-distances applications, BNEF argues, but fossil fuel trucks will also face major competition from other lower carbon alternatives such as natural gas and hydrogen vehicles in the coming years.
Overall, it suggests the impending electric revolution may well have the potential to spread into even diesel-dominated heavy goods segments previously seen as off-limits for green transport, and that fossil fuel engines could become a dying breed in the not-too-distant-future given the raft of low carbon alternatives now being developed.
Indeed, in one of the biggest shifts from its forecasts last year, BNEF estimates EVs could lead to a cut in road fuel demand by 13.7 barrels of oil per day in 2040, which is almost double the 7.3 million figure it had down last year.
“Our conclusions are stark for fossil fuel use in road transport,” said Colin McKerracher, head of advanced transport for BNEF.
“Electrification will still take time because the global fleet changes over slowly but, once it gets rolling in the 2020s, it starts to spread to many other areas of road transport.
“We see a real possibility that global sales of conventional passenger cars have already passed their peak,” he added.
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