Electric vehicle sales grew 160% in the first half of 2021, and this market has great potential!

Global electric vehicle sales continue to grow. Research firm Canalys estimates that electric vehicle sales in the first half of 2021 reached 2.6 million units, a 160% increase compared to the first half of 2020. Although the overall automotive market performance has declined due to the epidemic, as epidemic prevention policies are gradually relaxed, the market is gradually recovering. The electric vehicle market, including pure electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs), has grown by more than 26% of the total global automotive market.

Strong demand for electric vehicles continued into 2021, with sales in China and Europe being the most impressive. In the first half of 2021, 1.1 million electric vehicles were sold in China, accounting for 12% of China's total passenger car sales. In the European market, 1 million electric vehicles were sold, accounting for 15% of the total number of new cars. Electric vehicle sales in China and Europe combined accounted for 87% of global electric vehicle sales. In contrast, the electric vehicle market in the United States is currently stagnant, with only 250,000 electric vehicles sold in the first half of 2021, accounting for 3% of the total number of new cars.

Leading in China

Chris Jones, Canalys's vice president and director of automotive and electric vehicle analysis, believes that the Chinese market has a strong demand for electric vehicles, with 1.1 million units sold in the first half of 2021, equivalent to the sales volume for the whole year of 2020. Only 6% of the cars sold in China in 2020 were electric vehicles, but the number of electric vehicles sold in 2021 is expected to more than double that of 2020.

Tesla's outstanding performance in the Chinese market has prompted Chinese electric vehicle manufacturers to rapidly expand their electric vehicle products. Electric vehicle brands such as Aion, BYD, Ideal, Weilai, and Xiaopeng have all performed well in the market, among which the sales champion is Wuling Hongguang's mini electric vehicle. Among the top ten electric vehicles sold in the Chinese market in 2021, four are small urban cars.

Small urban electric vehicles are popular in the Chinese market (Image source: Wuling Motors)

Driven by strong consumer demand, electric vehicles have great potential for development in China. Xiaomi is optimistic about China's electric vehicle market and plans to invest 10 billion US dollars. Jones added that Xiaomi's emphasis on the electric vehicle market is within expectations, but it will not be easy to match or even surpass Tesla in terms of technology or price in the short term.

No. 1 in European adoption

Sandy Fitzpatrick, vice president of automotive and electric vehicles at Canalys, said that in some European countries, electric vehicles account for more than half of new car sales. Norway is the country with the highest adoption rate of electric vehicles in the world, with an adoption rate of electric vehicles in new cars exceeding 80%. The EU has set carbon emission standards, so the challenge for automakers is how to meet the market demand for electric vehicles during a period of component shortages.

The United States continues to catch up

Realizing that the penetration rate of electric vehicles in the United States is low, President Biden proposed investing $174 billion to increase market acceptance of electric vehicles by providing subsidies and building a large amount of charging infrastructure. At the same time, it is estimated that by 2030, 40% to 50% of new car sales will come from electric vehicles.

Fitzpatrick mentioned that when the government promotes the development of the electric vehicle market through incentives, fines and investments, consumer adoption will increase, but it will still take some time to see the results. One of the reasons for the slow pace of electric vehicle adoption in the United States is the limited selection of electric vehicle models in the United States, but automakers will launch popular electric vehicle models such as pickup trucks in the United States as soon as possible, which is expected to change the market's established impression of electric vehicles.