BusinessDay
NigeriaDecides2023

Global EV sales hit 6.6million in 2021 amid supply chain challenges

Electric Vehicle sales went up to 6.6million units, globally in 2021, even as it was faced with challenging supply chain bottlenecks, the latest International Energy Agency report indicates.
This result, according to the agency, represents close to 9 percent of the global car market and more than tripling their market share from the last two years.

However, the success of electric vehicles has been hampered by a lack of component supplies and rising bulk material prices, putting supply-side concerns at the forefront of government and business agendas.
“In 2021, the price of steel skyrocketed by as much as 100 per cent, aluminum around 70 per cent, and copper by more than 33 per cent, affecting both conventional and electric cars.”

Although, higher pricing for materials used to create batteries posed further obstacles for electric vehicles.
“To mention a few, the price of lithium carbonate grew by 150 per cent year on year, graphite by 15 per cent, and nickel by 25 per cent,” the report stated.

The IEA also gives an analysis of how the EV market has grown from 2019 to date.
“2.2 million Electric vehicles were sold in 2019, representing only 2.5 per cent of global sales,” according to the agency, adding that “in 2020, the whole car market declined, but electric car sales bucked the trend, climbing to 3 million and representing 4.1 per cent of total car sales.”

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The agency, also, estimated that there are now around 16 million electric cars on the road worldwide, consuming roughly 30 terawatt-hours (TWh) of electricity per year.
Meanwhile, the drivers of the EV market growth amid its supply challenges were also discussed.
“Government policies have been driving the global electric vehicle markets, but their vitality in 2021 also reflects a busy year for the automotive sector.
“Over the course of 2020 and 2021, many governments have established targets to phase out sales of internal combustion engine cars within the next two decades,” the agency said.

On the other hand, several automobile manufacturers have declared their targets towards net-zero emission.
Volkswagen, according to IEA, said that half of its sales would be electric by 2030.

Meanwhile, Ford is expecting 40 – 50 per cent of its sales to be electric by the end of the decade.
“Another significant milestone in 2021 was the statement by Toyota, the largest car manufacturer in the world, announcing new investments aimed at achieving electric car sales of 3.5 million a year by 2030,” the IEA noted.

Independent energy research and business intelligence company, Rystad Energy, in January 2022, noted that EV manufacturers will potentially reel from the projected skyrocketing of battery-grade lithium prices in the coming years while, conversely, research firm, Gartner, recently predicted that EV sales will rise by 35percent in 2022, with the global shortage in semiconductors forcing car manufacturers to design, develop, and produce their own chips by 2025.
“The EV value chain proved to be robust in 2021 as it managed to deliver on higher-than-anticipated demand. But for EVs to continue their current growth trajectory, battery supply chains and EV production capacity will have to expand at a rapid rate,” the IEA warned.