As climate change accelerates across the globe, facilitating a fast and smooth transition into electric vehicles (EV) and electric mobility (e-mobility) is now at the top of the agenda for governments, transport ministries, and the automotive and mobility industries. With tremendous investment and efforts pouring into the transition over the past several years, we have seen significant improvements in the quality, usability, and performance of EVs and their supply equipment (EVSE).
2022: The Tipping Point of EV Adoption
Although it can take quite some time before all vehicles on the road become electric, EVs are dominating new car sales in many countries. Norway, the leading country in EV adoption, showed a record-high annual EV market share of 86% over the year 2021, followed by another monthly record of 92% in March 2022. At this point, about 23% of all vehicles in use in Norway are EVs. Other leading EV adopters include Sweden, with an annual market share of 45% in 2021, followed by the Netherlands at 30%, Germany at 26%, Britain at 19%, France at 18%, and China at 15%.
Although Norway is currently the only country with an EV market share above 50%, there is little doubt that other countries will quickly catch up. Looking at Norway’s EV adoption pattern, it took about an equal amount of time for the market share to grow from zero to 20% and from 20% to 90%. This 20% mark can be seen as a tipping point, where adoption begins to accelerate.
This pattern can be explained by two reasons. The first is peer influence. Whenever a new technology is introduced to replace an existing one, a great majority of people try to wait until the early adopters have fully tested the technology before making a purchase. This effect is especially salient when making a high-involvement purchase like a car. Once one in five people (20%) start to purchase the new technology, the worries dissipate, and the general population begins their adoption. When reaching a stage where two in five people (40%) go for the new technology, people begin to feel peer pressure and refrain from purchasing the older technology due to fear of being left behind and loss of resale value.
The second reason is of course the growth in EV technology itself.
Based on this pattern, we can estimate that the EV market share in the EU (currently at 20%) will likely reach 80% in five years, and China (currently at 15%) will reach 80% in six years. These estimates do not take into consideration the accelerating growth of e-mobility technology and infrastructure so; by taking that into account, the EV market share in both EU and China could potentially reach 80% in as soon as four years.
Even in slower markets like North America, 2022 is on track to becoming a promising year. Canada’s EV market share grew from 3.8% in 2020 to 5.6% in 2021, showing great potential of reaching the 10% mark within 2022.
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