Trends in electric light-duty vehicles

Electric cars

Electric car sales continue to increase, led by China

Electric car sales1 saw another record year in 2022, despite supply chain disruptions, macro-economic and geopolitical uncertainty, and high commodity and energy prices. The growth in electric car sales took place in the context of globally contracting car markets: total car sales in 2022 dipped by 3% relative to 2021. Electric car sales – including battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) – exceeded 10 million last year, up 55% relative to 2021.2 This figure – 10 million EV sales worldwide – exceeds the total number of cars sold across the entire European Union (about 9.5 million vehicles) and is nearly half of the total number of cars sold in China in 2022. In the course of just five years, from 2017 to 2022, EV sales jumped from around 1 million to more than 10 million. It previously took five years from 2012 to 2017 for EV sales to grow from 100 000 to 1 million, underscoring the exponential nature of EV sales growth. The share of electric cars in total car sales jumped from 9% in 2021 to 14% in 2022, more than 10 times their share in 2017.

Over 26 million electric cars were on the road in 2022, up 60% relative to 2021 and more than 5 times the stock in 2018

Increasing sales pushed the total number of electric cars on the world’s roads to 26 million, up 60% relative to 2021, with BEVs accounting for over 70% of total annual growth, as in previous years. As a result, about 70% of the global stock of electric cars in 2022 were BEVs. The increase in sales from 2021 to 2022 was just as high as from 2020 to 2021 in absolute terms – up 3.5 million – but relative growth was lower (sales doubled from 2020 to 2021). The exceptional boom in 2021 may be explained by EV markets catching up in the wake of the coronavirus (Covid-19) pandemic. Seen in comparison to recent years, the annual growth rate for electric car sales in 2022 was similar to the average rate over 2015-2018, and the annual growth rate for the global stock of electric cars in 2022 was similar to that of 2021 and over the 2015-2018 period, showing a robust recovery of EV market expansion to pre-pandemic pace.

Global electric car stock, 2010-2022


Half of the world’s electric cars are in China

The increase in electric car sales varied across regions and powertrains, but remains dominated by the People’s Republic of China (hereafter “China”). In 2022, BEV sales in China increased by 60% relative to 2021 to reach 4.4 million, and PHEV sales nearly tripled to 1.5 million. The faster growth in PHEV sales relative to BEVs warrants further examination in the coming years, as PHEV sales still remain lower overall and could be catching up on the post-Covid-19 boom only now; BEV sales in China tripled from 2020 to 2021 after moderate growth over 2018-2020. Electric car sales increased even while total car sales dipped by 3% in 2022 relative to 2021.

China accounted for nearly 60% of all new electric car registrations globally. For the first time in 2022, China accounted for more than 50% of all the electric cars on the world’s roads, a total of 13.8 million. This strong growth results from more than a decade of sustained policy support for early adopters, including an extension of purchase incentives initially planned for phase-out in 2020 to the end of 2022 due to Covid-19, in addition to non-financial support such as rapid roll-out of charging infrastructure and stringent registration policies for non-electric cars.

In 2022, the share of electric cars in total domestic car sales reached 29% in China, up from 16% in 2021 and under 6% between 2018 and 2020. China has therefore achieved its 2025 national target of a 20% sales share for so-called new energy vehicles (NEVs)3 well in advance. All indicators point to further growth: although the national NEV sales target is yet to be updated by China’s Ministry of Industry and Information Technology (MIIT), which is responsible for the automotive industry, the objective of greater road transport electrification is re-affirmed in multiple strategy documents. China aims to reach a 50% sales share by 2030 in so-called “key air pollution control regions”, and 40% across the country by 2030 to support the national action plan for carbon peaking. If recent market trends continue, China’s 2030 targets may also be reached ahead of time. Provincial governments are also supporting adoption of NEVs, with 18 provinces to date having set NEV targets.

Support at the regional level in China has also helped to advance some of the world’s largest EV makers. Shenzhen-based BYD has supplied most of the city’s electric buses and taxis, and its leading position is also reflected in Shenzhen’s ambition of reaching a 60% NEV sales share by 2025. Guangzhou, which has a 50% NEV sales share by 2025 target, facilitated the expansion of Xpeng Motors to become one of the national EV frontrunners.

Monthly new electric car registrations in China, 2020-2023


Whether China’s electric car sales share will remain significantly above the 20% target in 2023 remains uncertain, as sales may have been especially high in anticipation of incentives being phased out at the end of 2022. Sales in January 2023 plunged, and while this is in part due to the timing of the Chinese New Year, they were nearly 10% lower than sales in January 2022. However, electric car sales caught up in February and March 2023, standing nearly 60% above sales in February 2022 and more than 25% above sales in March 2022, thereby bringing sales in the first quarter of 2023 more than 20% higher than in the first quarter of 2022.

Growth remained steady in Europe despite disruptions

In Europe,4 electric car sales increased by more than 15% in 2022 relative to 2021 to reach 2.7 million. Sales grew more quickly in previous years: annual growth stood at more than 65% in 2021 and averaged 40% over 2017-2019. In 2022, BEV sales rose by 30% relative to 2021 (compared to 65% growth in 2021 relative to 2020) while PHEV sales dipped by around 3%. Europe accounted for 10% of global growth in new electric car sales. Despite slower growth in 2022, electric car sales are still increasing in Europe in the context of continued contraction in car markets: total car sales in Europe dipped by 3% in 2022 relative to 2021.

The slowdown seen in Europe relative to previous years was, in part, a reflection of the exceptional growth in electric car sales that took place in 2020 and 2021 in the European Union, as manufacturers quickly adjusted corporate strategy to comply with the CO2 emission standards passed in 2019. These standards covered the 2020-2024 period, with EU-wide emission targets becoming stricter only from 2025 and 2030 onwards.

High energy prices in 2022 had a mixed impact on the competitiveness of EVs relative to internal combustion engine (ICE) cars. Gasoline and diesel prices for ICE cars spiked, but residential electricity tariffs (with relevance for charging) also increased in some cases. Higher electricity and gas prices also increased manufacturing costs for both ICE and EV cars, with some carmakers arguing that high energy prices could restrict future investment for new battery manufacturing capacity.

Europe remained the world’s second largest market for electric cars after China in 2022, accounting for 25% of all electric car sales and 30% of the global stock. The sales share of electric cars reached 21%, up from 18% in 2021, 10% in 2020 and under 3% prior to 2019. European countries continued to rank highly for the sales share of electric cars, led by Norway at 88%, Sweden at 54%, the Netherlands at 35%, Germany at 31%, the United Kingdom at 23% and France at 21% in 2022. In volume terms, Germany is the biggest market in Europe with sales of 830 000 in 2022, followed by the United Kingdom with 370 000 and France with 330 000. Sales also exceeded 80 000 in Spain. The share of electric cars in total car sales has increased tenfold in Germany since before the Covid-19 pandemic, which can in part be explained by increasing support post-pandemic, such as purchase incentives through the Umweltbonus, and a frontloading of sales in 2022 in expectation of subsidies being further reduced from 2023 onwards. However, in Italy, electric car sales decreased from 140 000 in 2021 to 115 000 in 2022, and they also decreased or stagnated in Austria, Denmark and Finland.

Electric car registrations and sales share in selected European countries, 2018-2022


Electric car registrations and sales share in China, United States and Europe, 2018-2022


Electric car registrations and sales share in selected countries, 2018-2022


Sales are expected to continue increasing in Europe, especially following recent policy developments under the ‘Fit for 55’ package. New rules set stricter CO2 emission standards for 2030-2034 and target a 100% reduction in CO2 emissions for new cars and vans from 2035 relative to 2021 levels. In the nearer term, an incentive mechanism operating between 2025 and 2029 will reward manufacturers that achieve a 25% car sales share of zero- and low-emission cars (17% for vans). In the first two months of 2023, battery electric car sales were already up by over 30% year-on-year, while overall car sales increased by just over 10% year-on-year.

The United States confirms return to growth

In the United States, electric car sales increased 55% in 2022 relative to 2021, led by BEVs. Sales of BEVs increased by 70%, reaching nearly 800 000 and confirming a second consecutive year of strong growth after the 2019-2020 dip. Sales of PHEVs also grew, albeit by only 15%. The increase in electric car sales was particularly high in the United States, considering that total car sales dropped by 8% in 2022 relative to 2021, a much sharper decrease than the global average (minus 3%). Overall, the United States accounted for 10% of the global growth in sales. The total stock of electric cars reached 3 million, up 40% relative to 2021 and accounting for 10% of the global total. The share of electric cars in total car sales reached nearly 8%, up from just above 5% in 2021 and around 2% between 2018 and 2020.

A number of factors are helping to increase sales in the United States. A greater number of available models, beyond those offered by Tesla, the historic leader, helped to close the supply gap. Given that major companies like Tesla and General Motors had already reached their subsidy cap under US support in previous years,5 new models from other companies being available means that more consumers can benefit from purchase incentives, which can be as high as USD 7 500. Awareness is increasing as government and companies lean towards electrification: in 2022, a quarter of Americans expect that their next car will be electric, according to the American Automobile Association. Although charging infrastructure and driving range have improved over the years, they remain major concerns for US drivers given the typically long travel distances and lower popularity and limited availability of alternatives such as rail. However, in 2021 the Bipartisan Infrastructure Law strengthened support for EV charging, allocating USD 5 billion in total funding over the 2022-2026 period through the National Electric Vehicle Infrastructure Formula Program, as well as USD 2.5 billion in competitive grants over the same period through the Charging and Fueling Infrastructure Discretionary Grant Program.

Monthly new electric car registrations in the United States, 2020-2023


The acceleration in sales growth could continue in 2023 and beyond thanks to recent new policy support (see Prospects for electric vehicle deployment). The Inflation Reduction Act (IRA) has triggered a rush by global electromobility companies to expand US manufacturing operations. Between August 2022 and March 2023, major EV and battery makers announced cumulative post-IRA investments of USD 52 billion in North American EV supply chains, of which 50% is for battery manufacturing, and about 20% each for battery components and EV manufacturing. Overall, company announcements including tentative commitments for US investments for future battery and EV production add up to around USD 75-108 billion. As an example, Tesla plans to relocate its Berlin-based lithium-ion battery gigafactory to Texas, where it will work in partnership with China’s CATL, and to manufacture next-generation EVs in Mexico. Ford also announced a deal with CATL for a battery plant in Michigan, and plans to increase electric car manufacturing sixfold by the end of 2023 relative to 2022, at 600 000 vehicles per year, scaling up to 2 million by 2026. BMW is seeking to expand EV manufacturing at its plant in South Carolina following the IRA. Volkswagen chose Canada for its first battery plant outside Europe, which will begin operations in 2027, and is also investing USD 2 billion in its plant in South Carolina. While these investments can be expected to lead to high growth in the years to come, the impact may only fully be seen from 2024 onwards as plants come online.

In the immediate term, the IRA has constrained eligibility requirements for purchase incentives, as vehicles need to be produced in North America in order to qualify for a subsidy. However, electric car sales have remained strong since August 2022, and the first months of 2023 have been no exception: In the first quarter of 2023, electric car sales increased 60% compared to the same period in 2022, potentially boosted by the January 2023 removal of the subsidy caps for manufacturers, which means models by market leaders can now benefit from purchase incentives. In the longer-term, the list of models eligible for subsidies is expected to expand. 

The 2023 outlook for electric cars is bright

Early indications from first quarter sales of 2023 point to an upbeat market, supported by cost declines as well as strengthened policy support in key markets such as the United States. Globally, our current estimate is therefore for nearly 14 million electric cars to be sold in 2023, building on the more than 2.3 million already sold in the first quarter of the year. This represents a 35% increase in electric car sales in 2023 compared to 2022 and would bring the global electric sales share to around 18%, up from 14% in 2022. 

Electric car sales in the first three months of 2023 have shown strong signs of growth compared to the same period in 2022. In the United States, more than 320 000 electric cars were sold in the first quarter of 2023, 60% more than over the same period in 2022. Our current expectation is for this growth to be sustained throughout the year, with electric car sales reaching over 1.5 million in 2023, bringing the electric car sales share in the United States up to around 12% in 2023.

In China, electric car sales were off to a rough start in 2023, with January sales being 8% lower than in January 2022. The latest available data suggests a quick recovery: over the entire first quarter of 2023, electric car sales in China were more than 20% higher than in the first quarter of 2022, with more than 1.3 million electric cars being registered. For the remainder of 2023, we expect the generally favourable cost structure of electric cars to outweigh the effects of the phase-out of the NEV subsidy. As a result, our current expectation is for electric car sales in China to be more than 30% higher than in 2022 and reach around 8 million by the end of 2023, reaching a sales share of over 35% (from 29% in 2022).

Based on recent trends and tightening CO2 targets not going into effect until 2025, the growth of electric car sales in Europe is expected to be the lowest of the three largest markets. In the first quarter of 2023, electric car sales in Europe increased by around 10% compared to the same period in 2022. For the full year, we currently expect electric car sales to increase by over 25%, with one-in-four cars sold in Europe being electric.

Outside of the major EV markets, electric car sales are expected to reach around 900 000 in 2023 – 50% higher than in 2022. Electric car sales in India in the first quarter of 2023 are already double what they were in the same period in 2022. In India and across all regions outside the three major EV markets, electric car sales are expected to represent 2-3% of car sales in 2023, a relatively small yet growing share.

There are, of course, downside risks to the 2023 outlook: a sluggish global economy and the phase-out of subsidies for NEVs in China could reduce 2023 growth in global electric car sales. On the upside, new markets may open up more quickly than anticipated, as persistent high oil prices make the case for EVs stronger in an increasing number of settings. And new policy developments, such as the April 2023 proposal from the US Environmental Protection Agency (EPA) to strengthen GHG emissions standards for cars, may send signals that boost sales even before going into effect. 

Electric car models

The number of electric car models rises, especially for large cars and SUVs, at the same time as it decreases for conventional cars

The race to electrification is increasing the number of electric car models available on the market. In 2022, the number of available options reached 500, up from below 450 in 2021 and more than doubling relative to 2018-2019. As in previous years, China has the broadest portfolio with nearly 300 available models, double the number available in 2018-2019, prior to the Covid-19 pandemic. This remains nearly twice as many as in Norway, the Netherlands, Germany, Sweden, France and the United Kingdom, which all have around 150 models available, more than three times as many as before the pandemic. In the United States, there were fewer than 100 models available in 2022, but twice as many as before the pandemic; and 30 or fewer were available in Canada, Japan and Korea.

Breakdown of available cars by powertrain and segment, 2022


The 2022 trend reflects the increasing maturity of EV markets and demonstrates that carmakers are responding to increasing consumer demand for electric cars. However, the number of electric car models available remains much lower than that of conventional ICE cars, which has remained above 1 250 since 2010 and peaked at 1 500 in the middle of the past decade. In recent years, the number of ICE models sold has been steadily decreasing, at a compound annual growth rate of minus 2% over the 2016-2022 period, reaching about 1 300 models in 2022. This dip varies across major car markets and is most pronounced in China, where the number of available ICE options was 8% lower in 2022 than in 2016, versus 3-4% lower in the United States and Europe over the same period. This could result from contracting car markets and a progressive shift towards EVs among major carmakers. Looking forward, the total number of ICE models available could remain stable, while the number of new models shrinks, if carmakers focus on electrification and keep selling existing ICE options rather than increasing budgets to develop new models.

In contrast to ICE models, EV model availability has been growing quickly, at a compound annual growth rate of 30% over the 2016-2022 period. Such growth is to be expected in a nascent market with a large number of new entrants bringing innovative products to the market, and as incumbents diversify their portfolios. Growth has been slightly lower in recent years: the annual growth rate stood at around 25% in 2021 and 15% in 2022. In the future, the number of models can be expected to continue to increase quickly, as major carmakers expand their EV portfolios and new entrants strengthen their positions, particularly in emerging markets and developing economies (EMDEs). The historic number of ICE models available on the market suggests that the current number of EV options could double, at least, before stabilising.

Electric car model availability in selected countries by size, 2018-2022


SUVs and large car models dominate both EV and ICE markets

A major concern for global car markets – both EV and ICE – is the overwhelming dominance of SUVs and large models among available options. Carmakers are able to generate higher revenues from such models, given higher profit margins, which can cover some of the investments made in developing electric options. In certain cases, such as in the United States, larger vehicles can also benefit from less stringent fuel economy standards, hence creating an incentive for carmakers to slightly increase the vehicle size of a car for it to qualify as a light truck.

However, large models are more expensive, which poses significant affordability issues across the board, and all the more so in EMDEs. Large models also have implications for sustainability and supply chains, being equipped with larger batteries that require more critical minerals. In 2022, the sales-weighted average battery size of small battery electric cars ranged from 25 kWh in China to 35 kWh across France, Germany and the United Kingdom, and about 60 kWh in the United States. In comparison, the average for battery electric SUVs was around 70-75 kWh in these countries, and within the 75-90 kWh range for large car models.

Transitioning from ICE to electric is a priority for achieving net zero emissions targets, regardless of vehicle size, but mitigating the impacts of higher battery sizes will also be important. In France, Germany and the United Kingdom in 2022, the sales-weighted average weight of a battery electric SUV was 1.5 times higher than the average small battery electric car, requiring greater amounts of steel, aluminium and plastic; the battery in the SUV was twice as large, requiring about 75% more critical minerals. The CO2 emissions associated with materials processing, manufacturing and assembly can be estimated at more than 70% higher as a result.

At the same time, in 2022, electric SUVs resulted in the displacement of over 150 000 barrels per day of oil consumption and avoided the associated tailpipe emissions that would have been generated through burning the fuel in combustion engines. Although electric SUVs represented roughly 35% of all electric passenger light-duty vehicles (PLDVs) in 2022, their share of oil displacement was even higher (about 40%), as SUVs tend to be driven more than smaller cars. Of course, smaller vehicles generally require less energy to operate and less materials to build, but electric SUVs certainly remain favourable to ICE vehicles.

In 2022, ICE SUVs emitted more than 1 Gt CO2, far greater than the 80 Mt net emissions reductions from the electric vehicle fleet that year. While total car sales decreased by 0.5% in 2022, SUV sales increased by 3% relative to 2021, accounting for about 45% of total car sales, with noticeable growth in the United States, India and Europe. Of the 1 300 available options for ICE cars in 2022, more than 40% were SUVs, compared to fewer than 35% for small and medium cars. The total number of available ICE options went down from 2016 to 2022, but the drop was only for small and medium cars (down 35%) while large cars and SUVs increased (up 10%).

Similar trends are observed in EV markets. Around 16% of all SUVs sold were electric in 2022, which is above the overall market share of EVs and demonstrates consumer preferences for SUVs regardless of whether they are an ICE vehicle or EV. Nearly 40% of all BEV models available in 2022 were SUVs, which is equivalent to the shares of small and medium car options combined. Other large models accounted for more than 15%. Just 3 years before, in 2019, small and medium models accounted for 60% of all available models, and SUVs just 30%.

In China and Europe, SUVs and large models accounted for 60% of available BEV options in 2022, on par with the world average. As a comparison, ICE SUVs and large models accounted for about 70% of available ICE options in these regions, suggesting that electric cars currently remain somewhat smaller than their ICE equivalents. Announcements by some major European carmakers indicate that there could be a greater focus on smaller, more popular models in the years to come. For example, Volkswagen has announced the launch of a compact model for the European market under EUR 25 000 by 2025 and under EUR 20 000 by 2026-2027, as a means to appeal to a broader consumer base. In the United States, over 80% of available BEV options in 2022 were SUVs or large car models, which is greater than the share of ICE SUVs or large models at 70%. Looking ahead, more electric SUVs are to be expected in the United States, should recent policy announcements on expansion of IRA incentives to more SUVs be implemented. Following the IRA, the US Treasury has been revising vehicle classifications, and in 2023 changed the eligibility criteria for clean vehicle credits relevant to smaller SUVs, which are now eligible if priced under USD 80 000, up from the previous limit of USD 55 000.

Electric cars remain much cheaper in China

The growth in electric car sales in China has been underpinned by sustained policy support, but also cheaper retail prices. In 2022, the sales-weighted average price of a small BEV in China was below USD 10 000. This is significantly less than the prices of small BEVs found in Europe and the United States, where the sales-weighted average price exceeded USD 30 000 in the same year. 

In China, the best-selling electric cars in 2022 were the Wuling Mini BEV, a small model priced at under USD 6 500, and BYD’s Dolphin, another small model, below USD 16 000. Together, these two models accounted for nearly 15% of Chinese BEV passenger car sales, illustrating the appetite for smaller models. To compare, the best-selling small BEVs across France, Germany and the United Kingdom – Fiat’s 500, Peugeot’s e-208 and Renault’s Zoe – were all priced above USD 35 000. Few small BEVs were sold in the United States, limited mainly to Chevrolet’s Bolt and the Mini Cooper BEV, which are priced around USD 30 000. Tesla’s Y Model was the best-selling BEV passenger car in both the selected European countries (priced at more than USD 65 000) and the United States (more than USD 50 000).6

Chinese carmakers have focused on developing smaller and more affordable models in advance of their international peers, cutting down costs following years of tough competition domestically. Hundreds of small EV manufacturers have entered the market since the 2000s, benefitting from a variety of public support schemes, including subsidies and incentives for both consumers and manufacturers. The majority of these firms went bankrupt due to competition as subsidies were gradually phased out, and the market has since consolidated around a dozen frontrunners, which have succeeded in developing small and cheap electric cars for the Chinese market. Vertical integration of battery and EV supply chains from mineral processing to battery and EV manufacturing, as well as cheaper labour, manufacturing and access to finance across the board, have also contributed to developing cheaper models.

Meanwhile, carmakers in Europe and the United States – both early developers such as Tesla and incumbent major manufacturers – have mostly focused on larger or more luxurious models to date, hence offering few options affordable for mass-market consumers. However, the small options available in these countries typically offer greater performance than those in China, such as longer driving range. In 2022, the sales-weighted average range of small BEVs sold in the United States was nearly 350 km, while in France, Germany and the United Kingdom it was just under 300 km, compared to under 220 km in China. For other segments, the differences are less significant. The broader availability of public charging points in China may, in part, explain why consumers there have been more willing to opt for lower driving ranges than their European or American counterparts.

In 2022, Tesla heavily reduced the price of its models on two occasions as competition increased, and many carmakers have also announced cheaper options in the coming years. While these announcements warrant further examination, this trend could indicate that the price gap between small electric cars and incumbent ICE options could progressively close during this decade.

Emerging markets

Emerging markets see encouraging growth

China, Europe and the United States – the three major markets for electric cars – accounted for about 95% of global sales in 2022. Emerging market and developing economies (EMDEs) outside China account for only a fraction of the global electric car market. Demand for electric cars has increased in recent years, but sales remain low.

While EMDEs often quickly adopt low-cost emerging technology products (e.g. smartphones, computers and connected devices), electric cars remain typically too expensive for the majority of the population. According to a recent survey, over 50% of Ghanaian respondents would prefer to purchase an EV to an ICE vehicle, but more than half of those potential consumers would not be willing to spend more than USD 20 000 for an electric car. Lack of access to reliable and affordable charging can be a barrier, as can limited access to EV servicing, maintenance and repair. In most EMDEs, road transport remains largely based on smaller mobility solutions in urban centres, such as two- and three-wheelers, which have seen much greater success in terms of electrification, as well as shared mobility for regional commutes. Purchasing behaviour is also different, with lower personal car ownership rates and more common purchase of used cars. Looking forward, while sales of electric cars – both new and used – can be expected to increase in EMDEs, it is likely that many countries will continue to rely primarily on two- and three-wheelers (see subsequent section on these vehicles in this report).

There was a notable boom in electromobility in 2022 in India, Thailand and Indonesia. Collectively, sales of electric cars in these countries more than tripled relative to 2021, reaching nearly 80 000. Sales in 2022 were 7 times higher than in 2019, before the Covid-19 pandemic. In contrast, sales in other EMDEs were lower.

In India, BEV sales reached nearly 50 000 in 2022, 4 times more than in 2021, while total car sales increased by just below 15%. Leading domestic manufacturer Tata accounted for over 85% of BEV sales, including through sales of its small BEV Tigor/Tiago, which quadrupled. Indian PHEV sales remained close to zero. Burgeoning electromobility companies are now betting on the government’s Production Linked Incentive (PLI) scheme – with around USD 2 billion in subsidy programmes – to ramp up EV and component manufacturing. This scheme has attracted investments totalling USD 8.3 billion.

The Indian market, however, currently remains geared towards shared and smaller mobility. In 2022, 25% of electric car purchases in India were by fleet operators, such as for taxis. In early 2023, Tata secured a large order from Uber for 25 000 electric cars. Furthermore, while 55% of three-wheelers sold were electric, fewer than 2% of cars sold were EVs. Ola, India’s top EV company by revenue, does not yet offer electric cars. Ola is instead concentrating on smaller mobility and aims to double its electric two-wheeler manufacturing capacity to 2 million by the end of 2023, and to reach an annual production capacity of 10 million between 2025 and 2028. The company also seeks to build lithium-ion battery manufacturing facilities, initially at 5 GWh capacity, scaling up to 100 GWh by 2030. Ola aims to start marketing electric cars for its taxi business by 2024 and to make its fleet of taxis fully electric by 2029, while launching its own electric car business for both the high-end and mass markets. It announced over USD 900 million of investments for battery and EV manufacturing in Southern India, and an increase in annual production from 100 000 to 140 000 vehicles. 

Electric car sales by powertrain and available models by car size in selected regions, 2018-2022


Electric car sales by powertrain and available models by car size in selected countries, 2018-2022


In Thailand, electric car sales doubled to 21 000, equally distributed between BEVs and PHEVs. The emerging presence of Chinese carmakers has accelerated EV adoption in the country. In 2021, Chinese original equipment manufacturer (OEM) Great Wall Motors launched its Ora Good Cat BEV model in the Thai market, and in 2022 it became the most sold electric car in Thailand, with nearly 4 000 sales. The second and third best-selling cars were also Chinese, manufactured by Shanghai Automotive Industry Corporation (SAIC), none of which were sold in the country in 2020. Chinese automakers were able to undercut EV prices from foreign competitors also present in the Thai market, such as BMW and Mercedes, thereby appealing to a broader consumer base. In addition, the Thai government offers various financial incentives for electric cars, including subsidies, excise duty waivers and import tax reductions, which have contributed to making electric cars more attractive. Tesla is planning to enter the Thai market in 2023 along with building Superchargers.

In Indonesia, BEV sales multiplied by more than 14, exceeding 10 000, while PHEV sales remained close to zero. In March 2023, Indonesia announced new incentives to support sales of electric two-wheelers, cars and buses, with the aim of strengthening domestic capacity in EV and battery manufacturing through local component requirements. The government aims to subsidise the sale of 200 000 electric two-wheelers and 36 000 electric cars in 2023, reaching a sales share of 4% and 5% respectively. The new subsidies could reduce the price of an electric two-wheeler by 25-50% to help compete against ICE equivalents. Indonesia plays an important role in EV and battery supply chains, in particular given its abundant raw mineral resources and status as the world’s largest nickel miner. This has attracted investment from global companies, and Indonesia could become the largest manufacturing hub in the region for batteries and components.

Model availability remains an issue in EMDEs, with many of the options on sale heavily geared towards the higher end, such as SUVs, large and luxury models. While the trend for SUVs is global, purchasing power is more limited in EMDEs, making such vehicles largely unaffordable. Across the different regions considered in this section of the report, for a total of more than 60 EMDEs, including those which receive support from the Global Environment Facility’s (GEF) Global E-Mobility Programme, there were two to six times more large models available than small ones in 2022.

In Africa, the best-selling electric car model in 2022 was the Hyundai Kona, a crossover BEV, and there were about as many recorded sales of Porsche’s large and expensive Taycan BEV as there were of Nissan’s medium-sized Leaf BEV. There were also eight times more sales of electric SUVs than of the Mini Cooper SE BEV and Renault Zoe BEV combined, the two best-selling small electric cars. In India, the best-selling electric car model was Tata’s crossover Nexon BEV, with over 32 000 sales, or three times more than the second best-selling model, Tata’s small Tigor/Tiago BEV. Across all of the EMDEs considered here, sales of electric SUVs reached 45 000, which is more than the sales of small (23 000) and medium (16 000) electric cars combined. In Costa Rica, the leading country in Latin America in terms of BEV sales share, only 4 models in the top 20 were not SUVs, and nearly a third were luxury models. The future of mass-market electrification in EMDEs relies on the development of smaller, more affordable electric cars, alongside two- and three-wheelers. 

On the distinction between vehicle registrations and vehicle sales

An important distinction for assessing the evolution of vehicle markets is the difference between registrations and sales. New registrations represent the number of vehicles that have been officially registered for the first time with the relevant government ministry or insurance agency, including domestically produced and imported vehicles. Sales can either refer to vehicles sold by dealers or agencies (retail sales), or to vehicles sold to dealers by vehicle manufacturers (factory shipments, i.e. including exports). The choice of metric can make a significant difference when analysing vehicle markets. For consistency in accounting across all countries, and to avoid double-counting at a global level, in this report vehicle market sizes are based on new vehicle registrations, where available, and retail sales otherwise, not on factory shipments.

China’s vehicle market trends in 2022 are a good illustration of why this matters. In 2022, an increase of 7 to 10% in factory shipments (reported as sales) for the Chinese passenger car market was reported, while insurance registrations showed a stagnation of the domestic market in the same year. This increase was observed in data from the China Association of Automobile Manufacturers (CAAM), which is the official data source for China’s car industry. CAAM data is collected from car manufacturers and represents factory shipments. Another widely referenced source is the China Passenger Car Association (CPCA), a non-governmental organisation that provides wholesale, retail sales and exports for passenger cars, but is not qualified to provide national statistics, and it does not cover all OEMs, whereas CAAM does. The China Automotive Technology and Research Center (CATARC) is a state-owned think tank, and collects car production numbers from vehicle identification numbers and car sales numbers from vehicle insurance registrations. In China, vehicle insurance is registered for the vehicle itself and not for the individual driver, and is therefore useful for tracking the number of vehicles on the road, including imports. The main differences between CATARC data and the other sources stem from exports and military or other cars that do not get registered, and inventory stocks of vehicle manufacturers.

In 2022 the total exports of passenger cars increased rapidly, making the differences between these data sources more apparent. In 2022 the export of passenger vehicles increased by almost 60%, exceeding 2.5 million, while the imports of passenger vehicles decreased by almost 20% (950 000 to 770 000).

Similar discrepancies between factory shipments and insurance registrations are apparent in the Chinese bus and truck (commercial vehicle) market. In both 2021 and 2022, total volumes of factory shipments were substantially higher than insurance registrations, implying net export shares of commercial vehicles of about 9% in 2021 and more than 13% in 2022. 

Number of commerical vehicle sales and vehicle registration in China reported by various sources, 2020-2022


Number of passenger car sales and insurance registration in China reported by various sources, 2020-2022

Electric light commercial vehicles

Sales of electric light commercial vehicles continue to increase, catching up with electric car sales

Electric light commercial vehicle (LCV) sales worldwide nearly doubled in 2022 relative to 2021 to more than 310 000 vehicles, even as overall LCV sales declined by more than 10%. At a global level, the electric LCV sales share is 3.6%, about one-quarter that of passenger cars. Current trends indicate that the electric LCV market is catching up with that of electric cars, suggesting that the gap in terms of EV sales shares could narrow in the future. For the first time in 2022, the increase in the share of electric LCVs outpaced that of electric passenger cars (albeit from a low base). This demonstrates that once a critical tipping point in terms of favourability of total cost of ownership (TCO) has been achieved, commercial vehicle purchasers are likely to respond more rapidly to economic fundamentals than private consumers. Commercial vehicle owners typically use their vehicles more intensively, and as they have an imperative to maximise profit, EVs provide an opportunity to considerably reduce operating costs. The experience of commercial owners can also provide learnings for the private consumers segment: better fleet and charging management could help address concerns over range limitations.

The share of PHEVs in LCVs has remained very low; around 98% of both electric LCV sales and stock in 2022 were BEVs. It is likely that this reflects the economic favourability of the battery electric powertrain – as opposed to plug-in hybrids – in commercial operations characterised by intensive usage, regularity and predictability (in terms of driving range, geographic extent, and return-to-base for overnight charging), as well as the lower maintenance and service costs of battery electric LCVs. Battery electric LCV adoption may also be spurred on by the continuing expansion of low- and zero-emission zones.

Electric light commercial vehicle (LCV) sales and sales shares, 2018-2022


In 2022, China led in terms of overall electric LCV sales with over 130 000 units sold, and nearly 15% of LCVs sold being electric.7 Subsidies for battery electric and fuel cell trucks and vocational vehicles (including LCVs) have decreased in recent years, but overall zero-emission commercial truck sales have been growing since 2020, even as subsidies per vehicle have declined, indicating the increasing commercial competitiveness of electric trucks.

In terms of market share, Korea continued to lead in 2022 with 27% of LCV sales being electric (36 000 vehicles), but sales growth in 2022 slowed to half its level in the previous year. This may be due to changes to the subsidy scheme for LCVs and to the repealing in April 2022 of a policy that made obtaining commercial registration permits easier for electric LCVs than ICE models (see Policy developments and corporate strategy).

Light commercial EV sales shares also grew substantially in the Nordic countries, with Norway reaching 25%, Iceland 16%, and Sweden 13%. In all other key European and North American national markets, shares are lower than 10%, and typically less than the global average of 3.5%, but the rate of growth in market share for electric LCVs was higher than for passenger light-duty vehicles (PLDVs) (albeit from a lower baseline) across most leading EV markets, including the United States, Japan, and the European Union.

Electric two- and three-wheelers

Electric two-wheeler sales declined in China while global electric three-wheeler sales continued to rise

Global electric two-wheeler sales totalled about 9.2 million in 2022, a drop of nearly 18% from 2021. This drop is almost entirely attributable to the dip in sales of electric mopeds and motorcycles in China, which fell from 10.2 million in 2021 to under 7.7 million in 2022, even as the overall two-wheeler market there continued to grow. Supply chain challenges stemming from China’s pandemic-related restrictions in 2022 hit the electric two-wheeler market particularly hard, and in spite of growth in sales of premium domestic and imported two-wheelers (e.g. from BMW, Ducati and others), the overall sales share of electric two-wheelers dipped back below 50%.8 Despite the decline in sales, China continued to dominate the electric two-wheeler market in terms of size, accounting for nearly 85% of global sales.

Electric two-wheelers also lost market share in Viet Nam, despite sales shares of domestically produced electric two-wheelers having increased considerably in recent years. In terms of absolute volumes, sales grew in most Asian markets outside China and Viet Nam.

India leads on sales of electric three-wheelers thanks to policy support and innovative business models

Sales of electric three-wheelers, which play an important role in urban mobility in India for both cargo and passenger services, soared to 425 000 units in 2022. Sales have been strong in India for a number of years, with hundreds of thousands of electric three-wheelers sold every year since 2012, with the exception of 2020, when the Covid-19 pandemic reduced sales volumes to 30% of the previous year.

Over half of India’s three-wheeler registrations in 2022 were electric, demonstrating their growing popularity due government incentives and lower lifecycle costs compared with conventional models, as well as higher fuel prices. IEA analysis on the TCO in India suggests that electric three-wheelers are already 70% cheaper than their gasoline-power ICE equivalents over their lifetime (IEA, forthcoming).

Policies including the purchase incentives under FAME II, supply-side incentives under the PLI scheme, tax benefits and India’s Go Electric campaign all contributed to reducing the higher upfront costs (see Policy developments and corporate strategy for a detailed discussion of these and other policies). A total of 15 Indian states have already adopted EV policies to promote stronger EV deployment (and many more are drafting them), the majority of which include additional demand incentives. Bulk procurement schemes, the emergence of the battery-as-a-service (BaaS) business model and India’s draft battery swapping policy all give further impetus to the rapidly rising sales of electric three-wheelers.

China followed India in terms of electric three-wheeler sales, with nearly 350 000 units sold in 2022. Together, China and India accounted for nearly 99% of global electric three-wheeler sales.

Korea continues to lead fuel cell electric car growth

In 2022, the stock of fuel cell electric vehicles (FCEVs) increased 40% compared to 2021, reaching over 72 000 vehicles globally. About 80% of the FCEVs are cars, 10% trucks and almost 10% buses. In 2022, the fuel cell truck segment grew at a faster rate than cars and buses, increasing 60%.

Korea is now home to over half of all fuel cell cars globally. Two-thirds of the additional 15 000 fuel cell cars that hit the road in 2022 were in Korea. This can be attributed in part to a policy landscape that supports FCEV production and sales, which has also led to Hyundai being the top fuel cell automaker.

The United States holds the second largest FCEV stock, with over 15 000 FCEVs. Most of these are fuel cell cars, with a little more than 200 fuel cell buses. In 2022, the stock of FCEVs in the United States increased more than 20%, which is much less than the 60% growth in China, which has the third largest FCEV stock.

Historically, China has dominated the heavy-duty fuel cell vehicle segments (trucks and buses). This is still the case in 2022, with China home to over 95% of the global fuel cell truck fleet and almost 85% of the global fuel cell bus fleet. However, in 2022, China added over 200 fuel cell cars to its FCEV fleet after years of only deploying buses and trucks.

For further details on the status of FCEVs and other hydrogen-based applications, see the IEA Global Hydrogen Review report series.

Fuel cell electric vehicle (FCEV) stock by region and by mode, 2022


Share of fuel cell electric vehicle (FCEV) and hydrogen refuelling station (HRS) stock by region, 2022

  1. The term sales, as used in this report, represents an estimate of the number of new vehicles hitting the roads. Where possible, data on new vehicle registrations is used. In some cases, however, only data on retail sales (such as sales from a dealership) are available. See section On the distinction between vehicle registrations and vehicle sales for further details. The term car is used to represent passenger light-duty vehicles and includes cars of different sizes, sports utility-vehicles and light trucks.

  2. Unless otherwise specified, the term electric vehicle is used to refer to both battery electric and plug-in hybrid electric vehicles but does not include fuel cell electric vehicles. For a brief description of the trends related to fuel cell electric vehicles, see section Korea continues to lead fuel cell electric car growth.

  3. NEVs (China) include BEVs, PHEVs and fuel cell electric vehicles. 

  4. Europe includes European Union countries, Iceland, Israel, Norway, Switzerland, Türkiye, and the United Kingdom.

  5. Manufacturer caps were still in place for sales taking place in 2022, with models by carmakers having sold over 200 000 EVs losing eligibility for the purchase incentive, even if they were manufactured in North America following requirements under the IRA. Caps were removed starting from 2023.

  6. However, Tesla has decreased car prices several times since the publication of the IRA in the United States, in part to boost sales as competition gets tougher (see section on corporate strategy and finance).

  7. Commercial truck sales in China are reported according to four gross vehicle weight (GVW) bins: less than 1.8 tonnes, 1.8-6 tonnes, 6-14 tonnes, and greater than 14 tonnes. These are reallocated to categories based on other external data sources to match IEA’s harmonised global definitions of light commercial vehicles (less than 3.5 tonnes GVW), medium trucks (3.5-15 tonnes), and heavy trucks (15 tonnes GVW and above).

  8. As with other vehicle types, tracking new two-wheeler registrations (“sales”) in China is difficult, as the official data source, CAAM, tracks factory shipments, and hence reports volumes that include exported vehicles. Tracking is particularly difficult in the case of electric two-wheelers, however, as many data sources include pedal-electric bicycles and other small electric mopeds (see, for instance, a recent industry report from Honda). Chinese data sources give vehicle sales of electric two-wheelers at around 50 million in 2021, and 60 million in 2022, of which about 7.6 million are classified as motorcycles (China Chamber of Commerce for Motorcycles). Some of these attain top speeds of less than 50 km/hour, and so are excluded from the above figures. In India, electric bicycles and mopeds with a top speed of less than 50 km/hour made up more than 80% of the market in 2021 and 2022. The accounting here includes only vehicles with a minimum top speed of 50 km/hr and that fit the UNECE definition of L1 or L3, based on data provided by