IEA Predicts Electric Vehicle Sales to Increase by 35% in 2023

As the Global Electric Vehicle Outlook 2023 reported a 55% increase in 2022 for the global sales of electric vehicles, this growth is expected to continue increasing this year by 35% to 14 million vehicles sold.

EV Sales Forecast

Electric Vehicles' global sales are expected to surge by 35% this year as the demand for EVs is booming day by day, predicted by the International Energy Agency during the Global Electric Vehicle Outlook 2023. Electrek reported that more than 2.3 million EVs have already been sold in the first quarter.

One out of five cars sold globally will be electric and the prices of smaller EVs are expected to drop to rival the combustion engine cars. China features prominently in the prediction, which makes up half of the EVs on the road worldwide. The country also produces battery-electric cars and plug-in hybrids, taking up 60% of EV sales last year.

Aside from China, the majority of sales are also concentrated in Europe and the United States, the second and third largest markets, with sales increasing last year by 15% and 55% respectively. By 2030, the average share of electric cars in total sales across three sectors is expected to reach about 60%.

As per IEA Executive Director Faith Birol on a media call, the forecast was increased by the agency in part of the United States Inflation Reduction Act and the European Union's Fit for 55 packages, which both support a much greener industry and subsidize consumers' purchase of electric vehicles.

When both of these were announced, major EV and battery makers announced their respective investments totaling at least $52 Billion in EV supply chains in North America.

Other Regions

Reuters reported that governments around the world are investing in expansions for their EV efforts out of concerns over the environment in order to boost their industrial policy and decrease dependency on oil. This includes India and Indonesia, which both tripled their eclectic vehicle sales to 1.5% and Thailand to 3%.

Changing the Status Quo

Being that China, the European Union, and the United States are the largest polluters in the world, this growth is good news. According to a report from Interesting Engineering, this will avoid the need for at least 5 million barrels of oil per day by 2030, which demonstrates the important implications of electrification of vehicles for the energy sector, specifically for oil.

Birol also explained how this transformation of the car manufacturing industry is going to affect the global oil industry and said, "The trends we are witnessing have significant implications for global oil demand. The internal combustion engine has gone unrivaled for over a century, but electric vehicles are changing the status quo."