The International Energy Agency (IEA) predicts that nearly one in every five cars sold globally this year will be electric vehicles (EVs), with the prices of smaller EV models falling to rival those of combustion engine automobiles in North America and Europe by the mid-2020s.
According to IEA Executive Director Fatih Birol, the agency upped its EV sales projections in part due to the US Inflation Reduction Act, which encourages green industries and subsidizes consumer purchases of electric cars (EVs).
China is prominent, accounting for half of all EVs on the road worldwide, including battery-electric cars and plug-in hybrids, and accounting for 60% of EV sales last year, says IEA. According to the IEA’s Timar Guell, prices for some smaller EV models in the country are approaching those of their combustion engine equivalents.
The IEA report says, worldwide electric car sales are predicted to increase 35% this year to 14 million, accounting for 18% of the passenger car industry, up from 4% in 2020. Governments are investing in EV expansion for the sake of the environment and to reduce reliance on oil, the demand for which will fall by 5 million barrels per day by 2030 as a result of the EV transition, according to Birol.
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