Wiktor Wise
The electric vehicle (EV) market is rapidly evolving, with sales and market shares fluctuating as new models are introduced and consumer preferences shift. In 2024, global sales of battery electric vehicles (BEVs) were projected to reach 13.3 million units, accounting for an estimated 16.2% of global passenger vehicle sales. This represents a significant increase from 9.6 million BEVs in 2023, which had a market share of 12%. In the US, Tesla has enjoyed a comfortable lead with the highest market share over the past five years, with 75% in 2022. However, Tesla's market share has been falling, and in 2024, it dropped to about 52%. Meanwhile, in Europe, Norway, Sweden, and the Netherlands are the largest markets, with 95%, 60%, and 30% of all car sales being electric, respectively. China has also dominated the electric two-wheeler market, but sales dropped globally in 2023. Chinese companies, particularly BYD, have started to threaten and dethrone western EV companies, with BYD surpassing Tesla as the top-selling electric car seller in the last quarter of 2024.
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What You'll Learn
China's EV market share
China's EV market has been experiencing significant growth in recent years. Between January and May 2024, EVs accounted for 41.1% of the country's new-car market, with BEVs making up 26.4%. In July and August 2024, over half of total automotive sales in China were electric or hybrid. This growth is driven by various factors, including customer preferences for environmentally friendly transportation options, government support and incentives, the development of charging infrastructure, and macroeconomic factors such as strong economic growth and a rising middle class.
The Chinese government has played a significant role in promoting the EV market through subsidies and exemptions from sales tax. From 2009 to 2023, the government provided $231 billion in subsidies, resulting in an increase in new electric car registrations. China has also invested in building a vast network of chargers, with 10.2 million EV chargers as of June 2024, a 54% increase from the previous year.
China's EV market is dominated by companies like BYD, which offers a range of popular EV models such as the BYD Song, BYD Seagull, and BYD Destroyer 05. Other notable brands include Changan, Nio, Luxeed (a collaboration between Huawei and Chery), Aito, Leapmotor, and Xiaomi.
In addition to passenger cars, China also leads in other EV segments. It continues to dominate the electric bus market, with 78,000 new vehicle registrations in 2020, contributing to a sales share of 27%. China also accounted for 99% of registrations in the electric two/three-wheeler category, with a global stock of around 290 million.
China's dominance in the EV market extends beyond vehicle sales. It is the leading country for battery production, particularly heavy-duty batteries, with over 70% of global battery cell production capacity. China's upstream advantage in the value chain is evident in its control of active cathode and anode materials production, with a significant lead over other countries.
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US's EV market share
The US electric vehicle market is dominated by Tesla, which enjoyed a 75% market share in Q1 2022. However, Tesla's market share has been falling as other automakers enter the market. As of June 2024, Tesla's market share was 52%, with Ford in second place at 8.2% and Hyundai in third at 5.4%.
More than 1 million EVs were sold in the US in 2024 for the first time. The percentage of electric cars in the US was 6.8% in May 2024, an improvement of 1.6 percentage points from 2022. In 2023, 7.3% of all new car sales in the US were fully electric, up from 5.8% in 2022 and 3.2% in 2021. California and Washington, D.C. had the highest percentage share of electric vehicles in 2023, with other West Coast states like Washington, Oregon, and Colorado also in the top five.
The global electric vehicle market size was estimated at USD 396.49 billion in 2024 and is projected to grow at a CAGR of 7.7% from 2025 to 2030. The US market is dominated by established players such as Tesla, Ford, and Hyundai, but other companies like General Motors, Honda, and Mercedes-Benz are also making strides in the EV space. The rise in popularity of SUVs and crossovers has fueled demand for AWD systems, and consumers are increasingly seeking vehicles that offer both sustainability and performance, with high-speed electric two-wheelers and three-wheelers gaining traction.
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Europe's EV market share
Europe's electric vehicle (EV) market has been experiencing significant growth in recent years. In 2023, electric vehicles accounted for 22.7% of new car registrations and 7.7% of new van registrations in the EU, with a total of 2.4 million new electric cars registered. This marked a steady increase since 2010, with a rapid surge in registrations between 2020 and 2023.
Several factors have contributed to the growth of Europe's EV market. Firstly, consumers are increasingly concerned about climate change and air pollution, driving a preference for environmentally friendly transportation options. Technological advancements have improved the performance and range of electric vehicles, addressing range anxiety. A wider range of electric vehicle models, including sedans, SUVs, and sports cars, has also contributed to market growth.
Government incentives and policies have played a pivotal role in boosting the EV market in Europe. EU legislation mandates emission targets for new cars and vans, encouraging the adoption of zero- and low-emission vehicles. Generous incentives in countries like Germany, Norway, Sweden, and the Netherlands have further propelled the market. Norway, for instance, reported that 95% of all cars sold in 2024 were electric, while Germany's well-established charging infrastructure has driven its position as the leading European country for electric vehicles.
However, recent data suggests a stagnating EU EV market, with a downward revision in BEV market share forecasts for 2025. High compliance costs, lack of widespread charging infrastructure, and insufficient EV market stimulus are challenges that the EU needs to address to stay on course for its green transformation.
Despite these setbacks, Europe is making strides in the EV battery production sector. BloombergNEF predicts that Europe's share of global battery production could reach 31% by 2030, indicating a potential shift in the landscape of the EV market.
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BYD's dominance in China
China has been dominating the electric vehicle market, with BYD Company Limited (BYD) being a key player in this. BYD is a publicly listed Chinese multinational manufacturing conglomerate, with its headquarters in Shenzhen, Guangdong, China. The company was founded by Wang Chuanfu in February 1995 as a battery manufacturing company.
BYD Auto, the largest subsidiary of BYD, was founded in 2003 and has since become the world's largest manufacturer of plug-in electric vehicles. BYD Auto manufactures passenger battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), which are collectively known as new energy vehicles (NEVs) in China. BYD's automotive business has been the main contributor to the company's revenue, accounting for over 80% of the total revenue in 2023. BYD Auto has experienced substantial sales growth since 2020, driven by the increasing market share of NEVs in China. The company's first mass-produced passenger car, the BYD F3, was introduced in 2005 and was considered a "copycat" of the Toyota Corolla. BYD's first plug-in hybrid electric vehicle, the BYD F3DM, was launched in 2008, followed by the BYD e6, its first battery electric vehicle, in 2009. In 2022, BYD ended the production of internal combustion engine cars to focus solely on NEVs.
BYD's subsidiary, FinDreams Battery, further contributes to its dominance in China. FinDreams Battery is the world's second-largest producer of electric vehicle batteries, after CATL. FinDreams Battery produces a range of batteries, including consumer, electronic, and energy storage batteries, specialising in lithium iron phosphate (LFP) batteries. As of November 2021, FinDreams Battery had established 15 major production bases across China, solidifying BYD's presence in the Chinese market.
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EV battery production
China is the global leader in EV battery production, accounting for over 70% of the world's lithium-ion battery manufacturing capacity. China's dominance in battery production is attributed to its highly integrated supply chain and low production costs. The country holds a significant lead in the upstream stages of the value chain, with almost 90% of the worldwide installed production capacity for active cathode materials and over 97% for active anode materials.
However, China's battery production comes with high levels of overcapacity. In 2023, China's cathode and anode active material installed manufacturing capacity far exceeded global EV cell demand. To address this overcapacity, China is the largest exporter of EV cells, cathodes, and anodes. Despite this, the excess capacity has negatively impacted producers' margins, creating a risk for manufacturers if they cannot find enough customers outside of China.
While China maintains its lead, other regions are accelerating their battery production. Europe, for instance, is projected to increase its share of global battery production to 31% by 2030. Within Europe, Germany is the largest producer of EV batteries, with Poland and Hungary also contributing significantly. The United States is also working to expand its battery production capacity, with a goal of doubling its capacity by 2025.
The global EV battery market is dynamic, with increasing production and technological advancements. As more countries prioritize the transition to electric vehicles, the competition in the EV battery production landscape is expected to intensify.
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Frequently asked questions
China dominates the global electric vehicle market, with Chinese EV brands accounting for 76% of global EV sales. In 2024, China sold 13 million electric and hybrid vehicles, four times as many as the United States. China has achieved this dominance through a combination of government subsidies, tax exemptions, and investments in EV infrastructure.
The United States is the second-largest car market in the world, but it is still playing catch-up in the electric vehicle market. In June 2024, electric and plug-in vehicles represented less than 10% of car sales in the U.S. However, the Biden administration has made the transition to EVs a key priority, aiming for 50% of vehicles sold to be electric by 2030.
Norway is the largest European market for electric vehicles, with 95% of all cars sold being electric. Sweden and the Netherlands are close behind, with 60% and 30% of their car sales being electric, respectively.
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