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European Electric Car Sales are Booming, But Headwinds Lie Ahead

Since their creation, fossil-fuel-powered vehicles have played a role in destroying our environment [1]. In Europe alone, passenger vehicles powered by internal combustion engines are accountable for 12% of greenhouse gas emissions [2]. While it seems like mitigating these harmful effects is a challenging task, recent sales of electric cars have risen sharply, giving hope that this transportation sector will be on track to achieve net-zero greenhouse gas emissions by 2050. This article will reflect on this sudden boom in electric car sales before looking at some challenges that this market faces as a result.

The Rise of the Electric Car

After a decade of rapid growth, sales of electric cars in 2021 hit 6.6 million, which is more than triple their market share from the previous two years [3]. Battery electric and fuel cells vehicles are also rising alongside this, increasing by 29% compared to the year before [4]. It is no wonder why, then, 1.2% of Western Europe’s passenger car Parc was made up of battery electric vehicles at the start of this year [5]. Britain, in particular, saw the most considerable annual increase in the number of electric vehicle registrations, summing to more than 305,000 registrations and totalling a 74% growth compared to 2020 [6]. On top of this, 130,000 more plug-in cars were sold this year compared to the amount sold in 2020 [6].

The total number of alternatively fuelled cars has grown significantly across the EU. Today, AF cars account for just under 5% of the European road vehicle fleet. Source: EAFO

What these statistics clearly show, then, is that electric car sales have suddenly soared in Europe this year. We can first thank the regulations that have been put in place by the EU to support this environmentally conscious market. In 2021, the EU proposed a ban on all sales of new cars that produce carbon emissions by 2035, marking the end of internal combustion passenger cars [2]. And, to help steer the push toward electric vehicles even further, some European cities have even set a target to meet this goal 5 years before this [2]. Meanwhile, others have already begun phasing out the use of internal combustion engines among private-hire vehicles and taxis [2].

Additionally, we can also thank some of the financial and tax incentives that governments have offered, with Italy recently joining the many European countries encouraging drivers to switch to electric vehicles. In March, the Italian Prime Minister signed a decree to devote 650 million Euros per year from 2022 through 2024 to promote electric cars [7].

The Challenges that Lay Ahead. 

While this boom in sales is making significant environmental progress, challenges have followed the automotive sector’s electrifying success. Ensuring that sufficient infrastructure is in place is a central obstacle because, if it is not correctly set up, it will be difficult for vehicle owners to transition to electric vehicles [8]. The House of Commons BEIS reiterated this in their 2018 report, stating:

“Poor provision of charging infrastructure is one of the greatest barriers to growth of the UK EV [Electric Vehicle] market. The existing charging network is lacking in size and geographic coverage, with substantial disparities in the provision of public charge points across the country” [8].

However, since then, things have improved. In fact, when Transport and Environment conducted a study on infrastructure this year, they found that European cities were making significant progress, naming London as the city with the best electric vehicle infrastructure [2]. To ensure that infrastructure developments continue to improve, Matthias Schmidt, a European Auto Analyst from Schmidt Automotive Research, recommended:

“Legislation, such as new builds must include charging infrastructure”. If this could not be achieved, he added that it should at least be made more accessible for residents of rented accommodation “to get permission to introduce charging infrastructure” [9].

Accessible EV infrastructure is a key factor in the adoption and proliferation of electric vehicles. Learn more about EVs with The Electric Car: Mobility in Upheaval. (Click on the image for a link).

So, progress is underway. But that has not prevented further challenges to the electric vehicle surge. Supply chain vulnerabilities have meant that several car manufacturers had to halt electric vehicle production over the last few months because of the challenges in procuring microchips [4]. In addition, critical materials needed to manufacture batteries, such as lithium, are also increasingly in high demand. In fact, under the sustainable development scenario, its demand is expected to rise to 904 thousand tonnes in 2040 [4]. Meanwhile, the price of the material is increasing by 150% year on year [10]. Fatih Birol, the executive director of the International Energy Agency, called for governments to act now to reduce these risks of price instability and supply disruptions:

“Left unaddressed, these potential vulnerabilities could make global progress towards a clean energy future slower and more costly – and therefore hamper international efforts to tackle climate change,” he said [4].

Yet, the rapid growth of the electric vehicle market has left European infrastructure and supply chains struggling to keep up. To ensure that this sector continues down the path toward decarbonisation in Europe, we must first address these issues. Without adequately confronting them, the electric vehicle market could stall, which, in turn, could stunt progress towards net-zero emissions on our roads.

References

[1] A. Nickischer, “Environmental Impacts of Internal Combustion Engines and Electric Battery Vehicles,” DuQuark, vol. 4, no. 2, pp. 21-31, 2020.
[2] Transport & Environment, “EV charging in seven European cities,” 11 April 2022. [Online]. Available: https://www.transportenvironment.org/discover/ev-charging-in-seven-european-cities/. [Accessed 28 April 2022].
[3] J. S. Hill, “Global EV sales triple in two years, but emission gains cancelled out by SUVs,” The Driven, 2 February 2022. [Online]. Available: https://thedriven.io/2022/02/02/global-ev-sales-triple-in-two-years-but-emission-gains-cancelled-out-by-suvs/. [Accessed 2022 April 28].
[4] E. Monitor, “Booming EV sales challenge critical mineral supply chains,” 14 February 2022. [Online]. Available: https://www.energymonitor.ai/sectors/transport/booming-ev-sales-challenge-mineral-supply-chains. [Accessed 28 April 2022].
[5] Shoutout, “The European Electric Car Monthly Study,” March 2022. [Online]. Available: https://shoutout.wix.com/so/15N-wUa-C?languageTag=en&cid=c09ccf18-959e-4f13-a907-1a4a673154c7#/main. [Accessed 28 April 2022].
[6] C. Lilly, “Electric car market statistics,” next greencar, 17 March 2022. [Online]. Available: https://www.nextgreencar.com/electric-cars/statistics/. [Accessed 1 05 2022].
[7] Reuters, “Italy approves new car incentives of 650 mln euros per year,” 7 04 2022. [Online]. Available: https://www.reuters.com/business/autos-transportation/italy-approves-new-car-incentives-650-mln-euros-per-year-2022-04-07/. [Accessed 1 05 2022].
[8] N. Robinson, “Electric Vehicles: What are the infrastructure challenges holding back growth?,” Moorhouse, [Online]. Available: https://www.moorhouseconsulting.com/insights/perspectives/electric-vehicles-what-are-the-infrastructure-challenges-holding-back-growth/. [Accessed 05 05 2022].
[9] M. Schmid, Interviewee, European Auto Analyst. [Interview]. 9 May 2022.
[10] L. Paoli and T. Gül, “Electric cars fend off supply challenges to more than double global sales,” IEA, 30 01 2022. [Online]. Available: https://www.iea.org/commentaries/electric-cars-fend-off-supply-challenges-to-more-than-double-global-sales. [Accessed 06 05 2022].

 

 

Images:
Maurizio Pesce from Milan, Italia (https://commons.wikimedia.org/wiki/File:Tesla_Factory,_Fremont_(CA,_USA)_(8763130149).jpg), „Tesla Factory, Fremont (CA, USA) (8763130149)“, https://creativecommons.org/licenses/by/2.0/legalcode

Mariordo (Mario Roberto Durán Ortiz) (https://commons.wikimedia.org/wiki/File:BMW_i3_home_charging_L2_CRI_04_2021_9753.jpg), https://creativecommons.org/licenses/by-sa/4.0/legalcode

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