Today’s global electric vehicle markets vary widely, shaped by different levels of policy support, corporate activity, consumer preferences and awareness, driving styles and cultural particularities. The role of policy was particularly important in directing the company’s strategy towards electrification and enabling consumer uptake.
In today’s major electric vehicle markets – including China, Europe and the United States – early adoption has begun in many cases through demand-stimulating policies, such as vehicle purchase incentives. Direct incentives have also been used for automakers in China. Many of these countries and regions are now seeing electric vehicle markets maturing, especially for cars, whose sales shares are rapidly increasing. More developed markets such as China and many European countries are now reducing or phasing out incentive schemes for electric vehicles and shifting focus towards other sectors such as heavy transport and freight.
At the same time, some governments in key markets have increased their targets for greater EV adoption, and are working to address other parts of EV supply chains, such as policy support for vehicle manufacturing, batteries and critical metals supply chains. Many other countries outside major markets have also begun introducing policies to support electric vehicle adoption in recent years, in some cases for the first time. Overall, global spending by governments and consumers on electric vehicles has risen significantly in the past few years, to exceed US$400 billion in 2022.
For businesses, policy requirements were an important driver of electrification in the early years of EV adoption. With the explosive growth of electric vehicle sales, it is becoming increasingly important for incumbent major automakers to offer electric vehicles as a core part of their portfolios in order to gain market share and maintain a competitive advantage. Competition is increasing, with a growing number of new entrants, particularly from China, but also from emerging markets and other developing economies, pushing the entire industry to accelerate decarbonisation. In general, the corporate strategy among the major automakers is undergoing a shift, and as in recent years, the period 2022-2023 will see a series of important announcements about electric vehicles: fully electric fleets, cheaper cars, more investments, and integration with the battery industry and important metals.
This section of the Outlook provides information on selected policy developments announced between April 2022 and March 2023, since the last release of the IEA’s Global Electric Vehicle Outlook in 2022.1
As in recent years, most pro-EV policies target the light duty electric vehicle (LDV) segment, where market maturity is more advanced and vehicle availability is greater. In 2022, more than 90% of global light duty vehicle (LDV) sales will be covered by a policy that encourages the use of electric vehicles. Typical policies include fuel economy and pollutant standards; zero-emission vehicle mandates; Economic and budgetary regulation of fuel and vehicles, such as fiscal and tax regulations; Purchase incentives and subsidies; Prohibiting the use of vehicles with internal combustion engines (ICE) only.
There is an increasing policy focus on the heavy duty vehicle (HDV) sector, including medium-haul trucks, HGVs and buses, and approximately 70% of global HGV sales are now covered by EV policies. Countries are increasing funding, committing to zero-emission vehicle (ZEV) deployment targets, and enacting HEV policies for the first time. In 2022, 11 countries signed the Global Memorandum of Understanding on Medium and Heavy Duty Zero-Emission Vehicles, bringing the total number of signatories to 27. These countries aim to produce new 100% zero-emission trucks and buses. Sales by 2040.
Policies are also shifting towards electric vehicle supply equipment (EVSE), or charging, and currently approximately 80% of global electric vehicle (LDV and HDV) sales are covered by EVSE-related policy. Countries are increasingly allocating funds to EV deployment, recognizing that a lack of charging infrastructure can be a critical barrier to EV adoption.
The period 2022-2023 was notable for the announcement of policies in the EU and the US – new CO2 standards and the Inflation Reduction Act (IRA), respectively – which are expected to have a significant impact on the path to a zero-emissions road. Transfer. In addition, many emerging market and developing economies outside China have developed a specific industrial policy to support the production of batteries and electric vehicles, seeking to take advantage of opportunities to enhance domestic manufacturing capacity.
