The electric vehicle (EV) sector is at a crossroads, grappling with a significant slowdown in demand for battery-light EVs in 2024. This shift, highlighted by GlobalData in their Electric Vehicle Outlook 2025 webinar, signals a broader reassessment of the global automotive landscape. The once-rapid growth of battery electric vehicles (BEVs) has hit a speed bump, with low-voltage BEV sales rising by a mere 14% in 2024, a stark contrast to the 30% growth seen in 2023. This deceleration is not uniform, however, with regional disparities painting a complex picture of the EV market’s future.
Europe, once a beacon of EV adoption, has stumbled. The continent saw a paltry 0.9% growth in BEV sales last year, with Germany, Europe’s automotive powerhouse, experiencing a devastating -27% de-growth. This downturn, attributed to the halt in EV subsidies, has led to workforce reductions, plant closures, and strategic realignments among European original equipment manufacturers. Yet, despite this setback, Europe is poised for a rebound in 2025, suggesting resilience and adaptability in the face of policy shifts.
Across the Atlantic, the U.S. also experienced a slowdown, with EV sales growing by just 6.5% in 2024, down from a nearly 50% increase in 2023. The U.S. market’s future is clouded by political uncertainty, with former President Donald Trump’s opposition to federal EV support potentially derailing progress. GlobalData forecasts a 15% drop in U.S. EV sales by 2030, a chilling prospect for an industry that has seen billions of dollars in investment. Trump’s influence extends beyond U.S. borders, with GlobalData’s Harminder Singh warning that the global EV market may feel the ripple effects of U.S. policy shifts in 2025.
In stark contrast, China’s EV market has remained a bastion of growth, with an 18% increase in 2024. The world’s largest EV market is expected to reach 12.6 million sales by 2035, buoyed by favourable policies and incentives. China’s scrappage incentive and new energy vehicle (NEV) tax exemption are set to further boost NEV sales in 2025, underscoring the power of supportive government policies.
This global realignment presents a stark reminder of the EV sector’s vulnerability to policy shifts. It also underscores the need for strategic adaptability among manufacturers and policymakers alike. The slowdown in Western markets may spur innovation, with companies seeking to diversify their product offerings and reduce reliance on government incentives. Meanwhile, policymakers may be prompted to re-evaluate their approach to EV support, seeking to strike a balance between fostering growth and ensuring fiscal responsibility.
The EV sector’s future is far from certain, but one thing is clear: the road ahead is fraught with challenges and opportunities. As the global market navigates this period of uncertainty, one thing is certain: the EV sector is far from done evolving.
