Electric vehicles (EVs) will dominate the passenger vehicle market by 2040, according to Bloomberg New Energy Finance (BNEF).
Reporting on BNEF’s prediction, Renew Energy ran a headline to focus the minds of traditional service-station owners: “Global petrol car sales may already have passed their peak as consumers eye EVs.”
Public transport has long been the acknowledged driver of EV uptake. But BNEF’s Electric Vehicle Outlook 2019 goes further, saying EVs will make up 57 per cent of all new passenger vehicle sales in 2040.
BNEF’s Head of Advanced Transport Colin McKerracher didn’t pull his punches regarding the prospects for petrol cars.
“Our conclusions are stark for fossil-fuel use in road transport,” he said. “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.”
All hail ride sharing
BNEF also says ride-sharing services such as Uber will continue to grow. In fact, it predicts, one in five passenger trips will be through a ride-sharing service.
This trend will boost the uptake of EVs, BNEF says, because ride sharers are shifting to EVs at a faster rate than the rest of the market.
“Providers of shared-mobility services will choose to go electric faster than private individuals,” BNEF analyst Ali Izadi-Najafabadi said.
“There are now over a billion users of shared-mobility services such as ride hailing globally. These services will continue to grow and gradually reduce demand for private vehicle ownership.”
Within the next ten years, predicts BNEF, EVs will outcompete traditional EVs, both in terms of lifetime and upfront costs.
Crucial to this trend is the dramatic fall in battery costs. In fact, according to BNEF, prices for lithium-ion batteries have fallen by 85 per cent in just nine years. At the same time, demand for lithium-ion batteries will rocket more than tenfold over the next decade.
China will lead the transition to EVs, according to BNEF, accounting for almost half (48 per cent) of new EV sales in 2025.