Electric vehicles could represent 33% of global sales by 2028, says study

By Paul Lienert

DETROIT, United States (Reuters) – Electric vehicle sales could hit 33% globally by 2028 and 54% by 2035 as demand picks up in most major markets, consultancy AlixPartners said on Wednesday.

Electric vehicles accounted for less than 8% of global sales in 2021, and just under 10% in the first quarter of this year.

To support that demand, automakers and suppliers are planning to invest at least $526 billion in electric vehicles and batteries by 2026, the company said in an annual report. That’s more than double the five-year investment forecast of $234 billion from 2020 to 2024.

This prospect of higher investment “makes growth in the electric vehicle market inevitable,” according to Mark Wakefield, co-leader of the consultancy’s automotive business.

The vehicle industry faces economic and supply chain challenges during the transition to electric powertrain, added Wakefield.

The transition will require “drastic changes in operating models – not just in factories and people, but in the whole way of working,” he said.

Raw materials for electric vehicles also cost more than twice as much as those used in combustion models: $8,255 per vehicle versus $3,662 per vehicle, based on May this year values.

The car electrification process will cost manufacturers and suppliers a cumulative total of $70 billion by 2030, according to Elmar Kades, co-leader of automotive at AlixPartners.

AlixPartners sees supply restrictions continuing into 2024, and expects total vehicle sales worldwide to drop to 79 million units this year, before rising to 95 million in 2024.

In the United States, total vehicle sales are expected to increase to 16 million units in 2023 and peak at 17.5 million in 2024 before starting to slow down between 2025 to 2026.