Despite Low Oil Prices, Electric Vehicle Sales Keep Rising

The two-year slump in oil prices has some analysts worried, and others crowing, that electric cars are in for a murky future if prices for vehicle fuel remain low. But several recent reports suggest that, if anything, sales of electric vehicles (EVs) and cars not built with the conventional internal combustion engine (ICE) are actually on the rise.

Across the world, electric car sales are on the upswing in developed and developing countries alike. The International Energy Agency (IEA), which has issued its annual report covering the sales of EVs, is bullish on their future. According to the IEA’s Global EV Outlook, last year saw the number of electric cars^*on the world’s roads pass the 1 million mark for the first time in history. Approximately 80 percent of the current 1.26 million electric cars worldwide are driven in five nations: China, Japan, the Netherlands, Norway and the United States. EV batteries continue to become more efficient, while their costs decreased by a factor of four since 2008. But the IEA has suggested that EVs still need support from policymakers in order for them to increase their adoption and deployment.

The overall increase in sales of both battery electric vehicles (BEVs) and plug-in electric hybrid vehicles (PHEVs) is supported by additional data. The consultancy EV Volumes estimated that, for the first four months of 2016, global sales of BEVs and PHEVs amounted to 180,500 from January to April this year, a 42 percent increase from 2015. These numbers come on the heel of the fourth quarter in 2015, when sales surged due to the decrease of financial incentives in nations including Denmark, the Netherlands and Sweden.

And according to Navigant Research, sales of non-ICE cars will continue to increase over the next decade. The worldwide sales of hybrid, BEVs and PHEVs together totaled 2.6 million cars last year. By 2024, advances in technology, climate-change mandates and purchase incentives will see that number increase to over 6 million cars. Navigant’s analysts are anticipating that PHEVs will comprise a larger ratio of those sales, from just 30,000 in 2011 to over 500,000 in 2024. Economies of scale, a decrease in battery charging time and and increase in range will be the underlying causes, the group predicts.

Watch for this trend to continue as companies such as GM, Nissan and Tesla roll out BEVs with a longer range and sticker prices under $40,000. And much of the growth in the mainstream adoption of electric vehicles should continue in the U.S., as well as China, where the government is considering mandates similar to ones passed in California, Bloomberg reports. California’s program eschews subsidies for drivers in favor of policies designed to motivate companies to produce or deliver cleaner-running cars, such as EVs, in larger proportions to conventional cars sold throughout the state.

Image credit: Dave Pinter/Flickr

^*The IEA broadly defines electric cars by including battery-powered, plug-in hybrid electric and fuel-cell electric vehicles (BEVs, PHEVs, FCEVs), but the scope of its report was limited to BEVs and PHEVs).