The Future Of Electric Vehicles - What Does It Look Like?

The increasing demand for electric vehicles

Major advancements in technology, as well as changes in consumer behaviour and government regulations over the past decade or so, have all contributed to the increasing prevalence of electric vehicles (EVs), both in Australia and around the world. In fact, it is predicted that by 2030, 75% of new car sales will be EVs and 1 in 4 cars on the road will be an EV. 

Although only one per cent of Aussies purchased EVs in 2021, many experts are confident that the next twelve months will see a significant increase in EV purchases. One of the contributing factors to this is the wide range of choice that Aussies are set to experience: in 2021 there were 31 EV models available in Australia, and by the end of 2022 there will be at least 58.

Luke Cove, Managing Director of EV charger installers Lightning Solar & Electrical, says that the past few months have seen an especially large increase in demand for EVs:

“One thing we've seen is an undeniable increase in demand for electric vehicles, not just in the past 4 years but significantly increasing in the past 4 months.”

On a global level, the EV market has experienced over a decade of rapid growth, and is recovering quickly from the economic repercussions of COVID-19. It is expected that Europe will be the fastest market to electrify, and is expected to remain as the global leader in electrification. This is largely due to its nature as a regulatory-driven market that has positive consumer demand trends

Philip Westfall, of RVezy, has commented on the electrification of Europe:

“Europe is proving to be the forerunner in switching to electric vehicles due to the number of conscious buyers promoting clean and green purchasing habits. The institution of regulations that discourage the use of fossil fuels has changed people's minds and promoted the purchase of electric vehicles that align with new environmental goals.”

Global sales of electric vehicles

Electric cars experienced a record year of sales in 2020, with the global EV stock hitting the 10 million mark - which was a massive 43% increase from 2019. In 2020, China had 4.5 million EVs, making it the largest fleet in the world, while Europe experienced the largest increase to hit 3.2 million vehicles. 

In the first half of 2020, new car registrations dropped by a third, as the entire world experienced an unprecedented drop in car sales due to the COVID-19 pandemic. Stronger activity in the second half of 2020 and beyond meant that the EV market recovered fairly quickly. In Europe, the main reason for the quick recovery and surge in sales was two major policy measures: subsidy schemes that were implemented for EVs post-pandemic, and 2020 being the target year for the EU’s CO2 emission standards that limited the average carbon dioxide emissions per km driven for new cars. 

The current major players

Though there are a growing number of car manufacturers who are jumping on the EV bandwagon, there are five major players that are currently dominating the market. Coming in at a clear number one is Tesla, who holds over a 21 per cent share in the fully EV market. In fact, Tesla’s Model 3 itself, as the most sold EV ever, holds a 12 per cent market share.

The second biggest EV player is also the largest carmaker in the world, SAIC Motor. SAIC holds a 13 per cent share of the fully EV market and is the most popular choice for EVs in China. Following these two major players are Volkswagen at 10 per cent, BYD at 6.5 per cent and Hyundai at almost 5 percent of the market.

Emerging players

Though these major car companies are currently dominating the EV market, there are a number of exciting emerging players that are worth keeping an eye on. 

Rivian is arguably one of the strongest new EV startups, and has enjoyed the backing of a number of major investors including Ford and Amazon. Rivian currently has a market capitalisation of more than $90 billion dollars, and its R1T pickup is now on sale.

Another exciting emerging player is Lucid, whose CEO and Chief Technology Officer was integral in the creation of the original Tesla Model S. 

Finally, Polestar is a Swedish company that is jointly owned by Volvo and Geely, but remains a standalone brand. Their first model was a high performance plug-in hybrid, but the Polestar 2 along with all of its future products, including the anticipated Polestar 3 SUV, are fully electric. James Reeves, of Saxton 4x4, is particularly interested in the future of electric SUVs, saying that “One of the largest trends in electric vehicle markets I predict for the next 5 - 10 years is the increasing production of Electric SUVs by top brands. You might think that SUVs and environmentally friendly cars are polar opposite but that's where electric SUVs come in. They combine the best of both worlds.”

New technologies

There are a number of reasons why EVs have been so popular around the world, but for many customers, the environmental benefits are by far the largest drawcards. Pure EVs produce no carbon dioxide emissions while driving, which significantly reduces air pollution.

Going forward, EV companies will be seeking to further reduce material emissions in the actual production of the cars, primarily by increasing the amount of recycled materials used in making EVs as well as shifting towards green raw materials (ie: high-grade materials that have low emissions footprints). 

Jamie Page Deaton, Editor-in-Chief of CarTalk.com, suggests that there are three main trends in EVs in the short term:

“The three biggest trends… will be expanding range, lower costs, and increased commercial applications. As battery technology improves, we will see longer range available on electric vehicles, so consumers will no longer need to buy the top-of-the-line model to get more than 200 miles of range. 

At the same time, as electrical vehicle makers start to recoup some of their development costs due to wider adoption of EVs, prices should go down for consumers. 

Finally, with the increased range and lower costs, we'll see more commercial fleets adopt EVs, so it won't be uncommon to have electric delivery vehicles, as well as electric trucks for contractors and tradespeople.”

Final thoughts

Though EVs may have seemed at one point a futuristic concept, they are already set to fundamentally transform the automotive industry, and this is a crucial move to dramatically reduce carbon emissions and tackle climate change and the host of environmental issues that exist in our world.

Maddie Barclay

Maddie is the marketing coordinator at Driva knowledgeable in all things car finance related. When she’s not writing informing, helpful articles you can find her at the beach or spending time with her family.

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