Norway continues to lead the global market for electric vehicles, according to the most recent plug-in electric vehicle (PEV) index from IHS Automotive, part of business information provider IHS Markit (Nasdaq: INFO). Plug-in electric vehicles are defined as either a pure Battery Electric Vehicle (BEV) or a Plug-In Hybrid Vehicle (PHEV).
Based on analysis of new vehicle registrations during the first quarter 2016, one out of every three vehicles registered in Norway during the quarter was a plug-in electric vehicle, reflecting more market penetration in Norway than any other major market tracked by IHS Markit within the index. In a previous study from IHS Markit, one in four vehicles registered in Norway during the same timeframe a year ago was a PEV, which demonstrates the continued commitment to alternative propulsion vehicles in this country.
The Netherlands continues to also be a hot market for electric vehicles, but has lost momentum recently and trails significantly behind – with just 2.2 per cent share of all new vehicles registered there being electric. France is gaining, with 1.6 per cent share. The UK is the only other market tracked with share of more than 1 per cent, with 1.3 per cent of all vehicles registered there being electric.
Other key markets still remain below a 1 per cent average in electric vehicle market share – with the US, Germany, Japan and China ranking further down in the index. While China leads in volume, with more than 32,000 electric vehicles registered during the quarter, its market share for EVs is just 0.5 per cent. Additionally, recent announcements by authorities there aimed at potentially curbing the number of EV manufacturers may have an even greater impact on overall production in the region. Likewise, the US also has high volumes, with more than 26,000 units registered during the first quarter, however, just less than one per cent of the total market.
Based on IHS Markit research, regional legislative activities have driven the EV movement in certain locations. Norway has historically been supportive with EV incentive programs and other efforts toward adopting green technology.
“Attractive incentives in France are also spurring EV growth there,” said Ben Scott, senior automotive analyst for IHS Markit. “However, a recent change in PHEV taxation in the Netherlands has somewhat inhibited the market in this country.”
German authorities recently enacted a new subsidy for PEVs during the second quarter, and IHS Markit analysts predict an uptick there is on the horizon.
“Consumers in Japan have been more interested in traditional hybrids. However recent changes in subsidy may drive PEV uptake as well as hydrogen fuel cell vehicles,” Scott said.
More countries are developing policies for incentives and building charging infrastructure capability, however, they will be unable to sustain these developments alone. Increased production of electric vehicles across the manufacturing base is required to make them more affordable for consumers, in order to allow for substantial growth of these types of vehicles, IHS Markit says.
In current forecasts from IHS Markit, it is expected that plug-in electric vehicles will account for just 4 per cent of light vehicles produced globally in 2020, up from about 1 per cent in 2016, when the company expects an estimated one million electric vehicles produced globally by the end of the year.