Global EV Sales to Hit 27% of Market by 2026 Despite US Policy Headwinds
BloombergNEF projects a steady global rise in electric vehicle adoption, though policy shifts in the US and a maturing Chinese market are creating an uneven transition.
Electric vehicles are projected to account for 27% of global car sales by 2026, according to the latest Electric Vehicle Outlook (EVO) from BloombergNEF. This trajectory marks a steep climb from just 9% five years ago, signaling a fundamental shift in the global automotive landscape.
While the overall trend is upward, the pace of adoption is diverging by region. In European markets, the financial barrier to entry is falling; the cost premium for EVs over internal combustion vehicles dropped from 34% to 17% in 2024. Meanwhile, emerging markets are seeing aggressive growth, with Singapore reporting nearly 50% of new car sales as electric last year, followed by Vietnam at 39% and Thailand at 27%. Conversely, the US market is facing a downturn, with EV sales falling 19% this year following the cancellation of government support and a shift in sales timing toward 2025.
The Drivers of Transition
The global pivot toward electrification is being propelled by falling lithium-ion battery prices, the arrival of more affordable vehicle models, and the increasing cost of traditional fossil fuels. However, these tailwinds clash with regional volatility. Aleksandra O’Donovan, Head of Electric Vehicles at BloombergNEF, notes that the transition is becoming "increasingly uneven across markets," citing the maturing market in China and policy instability in the United States as primary factors.
Beyond the vehicles themselves, the transition is placing unprecedented pressure on energy grids. Electricity demand for EVs is projected to surge from 367 TWh in 2025 to 2,700 TWh by 2040, creating a resource competition with other energy-intensive sectors, such as data centers.
Economic and Environmental Stakes
The scale of this shift represents a massive economic pivot. By 2035, annual vehicle spending is estimated to reach $2.2 trillion, with an additional $524 billion required for charging infrastructure investment. From an environmental perspective, the shift is expected to begin reducing global petroleum demand by 2029, a critical milestone for net-zero transport goals.
However, the transition of the total fleet is far slower than the transition of new sales. Andrew Grant, Head of Intelligent Mobility at BloombergNEF, warns that slow fleet replacement rates mean combustion vehicles will remain on the road for decades, creating a "headache for policymakers."
The Long Road to Majority
Looking ahead, BloombergNEF predicts that EVs will make up 52% of global car sales by 2035. Despite this growth in new sales, the legacy of existing internal combustion engines means it will take significantly longer to flip the total global fleet. Current projections suggest it will be 2047 before the majority of passenger vehicles actually on the road globally are electric.