Africa to tap into $57 trillion EV market

Africa can tap into the $57 trillion electric vehicles(EV) market to join players such as China, the United States and Europe who are the three biggest EV markets globally.

The global electric vehicle market has experienced significant growth, which is driven by increasing environmental concerns and advancements in technology.

“The size of electric vehicles(EV) is estimated to increase from the current $7 trillion to $57 trillion by 2050 and that future depends on Africa,” Akinwumi Adesina, president of African Development Bank Group said at the Africa Investment Forum 2023 held on November 8, 2023, in Palace Congress, Marrakech.

He said this is because Africa accounts for the largest source of green metals for the development of electric vehicles, including platinum (70%), cobalt (52%), manganese (46%), bauxite (25%), and graphite (21%).

“Africa has the largest sources of renewable energy sources in the world, including hydro and solar. And right here in Morocco, you have the Noor Ouarzazate, the largest concentrated solar zone in the world,” Adesina said.

Africa will be tapping into these market with China, United States and Europe who are the three biggest EV players in the world.

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According to EnergyPortal.eu, China stands as the largest EV market in the world who has made substantial investments in EV infrastructure and manufacturing.

“China has incentives such as subsidies, tax breaks, and license plate restrictions which has encouraged consumers to embrace electric mobility,” it said.

It stated that China’s commitment to reducing air pollution and dependence on fossil fuels has further fueled the growth of the EV market.

The United State holds a prominent position in the global EV market, EnergyPortal.eu said, adding that the country has witnessed a surge in EV sales, driven by federal and state-level incentives, including tax credits and rebates.

“Moreover, the presence of established automakers and innovative startups has contributed to the growth of the EV industry. However, the market share of EVs in the United States is still relatively small compared to traditional internal combustion engine vehicles,” EnergyPortal.eu stated.

It said Europe has emerged as a major player in the global EV market, with several countries leading the way in EV adoption. Norway, has the highest EV market share globally, thanks to generous incentives, toll exemptions, and access to bus lanes.

“Other European countries like Germany, France, and the Netherlands have also witnessed significant growth in EV sales, driven by government support and the expansion of charging infrastructure,” EnergyPortal.eu said

Strategy and part of the PwC Network’s ‘Electric Vehicle Sales Review Q3-2023’ report stated that battery-electric vehicle sales in all twenty analysed markets increased by 26 percent in the third quarter of 2023 in comparison with the same period last year.

“But if it were not for waning growth in the Chinese market, that figure would be considerably higher,” the report said.

The report said that is because China heavily dominates the global battery electric vehicles market, “Chinese battery electric vehicles sales accounted for two-thirds of sales in all analysed markets in the third quarter of 2023.”

Battery electric vehicle sales growth in China has been slowing for several months, largely due to a weakening economic outlook. It is now significantly lower than just two years ago.

The strongest increase was recorded in Germany, with growth of 59 percent in comparison with Q3 2022. The battery electric vehicles markets in the UK and France also grew strongly, up by 42 percent and 40 percent respectively, from Q3 2022.

Battery electric vehicle sales in Spain grew by 57 percent, but from a low base. The battery electric vehicles market share in Spain stands at 6 percent, compared to 18 percent in Germany, and 16 percent in the UK and France.

Adesina cited an assessment by Bloomberg NEF which shows that the cost of manufacturing of lithium-ion precursor batteries in Africa is 3 times less than in the U.S., China, and Poland.

“The African Development Bank and partners are developing the $20 billion Desert-to-Power project across 11 countries that share the Sahel zone, which when completed will be the largest solar zone in the world,” he said.