For electric vehicle sales to reach a solid share of global auto sales, serious growth surges will need to happen.
Monthly sales worldwide fell 14 percent in key markets China and North America. That came to about 128,000 plug-in passenger battery-electric and plug-in hybrid electric vehicles sold worldwide, money management firm Sanford C. Bernstein said in a report on Tuesday.
Reductions in electric vehicle subsidies and a cooling economy impacted the Chinese market. The Indian government is also struggling to get EVs to become adopted in its cities in any significant way.
Global plug-in vehicle deliveries reached 2.1 million units for 2018, 64 percent higher than in 2017 and 2.4 percent of the world’s overall 86 million units sold last year. IHS Markit sees EV market share inching up over the next half decade — reaching about 7.6 percent of total new vehicle sales worldwide by 2025.
Rising trade tensions and tariffs, a slowdown in China’s booming economy, and the implementation of stricter emissions rules, have had their impact on overall new vehicle sales in the country. Much of the the June sales boom was fueled by dealers cutting prices way down to clear inventory and prepare for emission controls coming to new vehicles.
“Unsurprisingly the growth momentum halted in July amid subsidy cuts,” Bernstein analysts said in the report. But strong conditions are expected to come back.
“Despite expected short-term weakness in 2019, we continue to be positive on long-term EV demand.”
Tesla led the global market in July, with sales of about 20,000 units. The US company was followed by Chinese competitor, BYD Co.
Another top auto market, India, is struggling to get consumers and rickshaw drivers to convert over to EVs and meet goals the government had laid out. It's clear that EVs will cost less to run than using the current widely used diesel or compressed natural gas as motor fuel, but making that conversion over to the new powertrain is hitting a wall.
India’s government had called for a lofty goal in 2017 — converting over to only EVs available for sale by 2030. Automakers have protested the target as being too difficult. The government wants to see EVs play a key role in combatting worsening air pollution in its cities and to fight climate change.
The government wanted to see this conversion go away from two-wheeled vehicles over to electric cars and trucks. One government think tank recently issued a warning, suggesting that the policy should at first focus on electric two-wheelers and motorized rickshaws.
India’s transport minister also has suggested the country may consider creating new highways reserved only for EVs.
Foreign automakers and tech companies see India’s fast growing population — at more then one billion now — as a potentially huge market for EVs, charging stations, batteries, and other tech features needed to make EVs viable.
South Korea’s Hyundai Motor Co. sees the real market potential. The automaker committed $250 million last December to build EVs such as its Kona subcompact SUV in India over the next three years.
Finding a recharging infrastructure with accessible charging stations has been a tough barrier for India to get over. Last year, the Ministry of Power put a structure in place for installing charging stations. For now, there are only a few that are yet in place in the greater Delhi area, which has well over 20 million people.
Tata Group, one of India’s major domestic automakers, plans to install chargers in Mumbai and Delhi, but these will only recharge its own vehicles. The government would like to see a broad recharging network spread across the country.
Depending on EVs reaching mass market continues to be a stiff challenge for regulatory agencies targeting emissions, and for automakers working hard to meet strict and upcoming regulations. While overall EV sales have been steadily climbing in recent years, key markets such as the US continue to see internal combustion engines winning, with cheap gasoline and diesel helping their sales dominate quite a bit.