[2024 Green Mobility] Electric Vehicle Share Nears 20% This Year... Expanding in US and Europe

The global demand for completed vehicles is expected to be around 84 million units this year, according to industry forecasts. This represents an increase of about 1.6% compared to last year, indicating little significant change. However, the situation is different for eco-friendly vehicles, including electric vehicles. The electric vehicle market (including plug-in hybrids) is expected to grow by nearly 25% compared to last year, with more than 16 million units projected to be sold this year. The electrification penetration rate, which is the proportion of electric vehicles among all completed vehicles, is expected to approach 20%. In recent years, the electric vehicle market has expanded mainly in the Chinese domestic market, but the industry expects the share to steadily increase in advanced markets such as the United States and Europe going forward.

Hybrid vehicles, once considered merely a transitional option, have entered a second golden age as a practical alternative. Although they were not prominent during the period when the gap between supply and demand for completed vehicles was large due to the spread of COVID-19, as the market normalized, the high price of electric vehicles and insufficient charging infrastructure highlighted the advantages of hybrids, which benefited as a result. Last year, newly registered hybrid vehicles in South Korea exceeded 300,000 units for the first time on an annual basis. This represents an increase of about 46% compared to the 210,000 newly registered units in 2022.

Tesla Electric Vehicle Charging Station
Photo by Yonhap News

The increase in demand for eco-friendly vehicles is due to multiple factors. First, the maintenance costs such as fuel are lower than those of conventional internal combustion engine vehicles, and there is a strong trend in major markets and countries to regulate internal combustion engine vehicles in the mid to long term. Compared to the past, the technology and quality levels have improved, making it common to use a vehicle for more than 10 years after purchase. It is expected that by around 2030, the number of areas where internal combustion engine vehicles cannot operate will increase. Already, some major urban centers worldwide, including Seoul, restrict the operation of certain internal combustion engine models.

Additionally, industries providing transportation services are required to purchase a certain proportion of eco-friendly vehicles, and completed vehicle manufacturers will be penalized based on the emissions and fuel efficiency of the vehicles they sell. There is also voluntary demand from consumers who perceive the climate crisis as serious or want to be early adopters of eco-friendly vehicles. Although the market for hydrogen fuel cell vehicles, which use hydrogen fuel cells, is still in its very early stages, it is expected to grow in the mid to long term. Some manufacturers are proactively investing resources to take the lead in this market.

This content was produced with the assistance of AI translation services.