LONDON — The rush to electrify transportation will shift to Europe from China in 2020 as automakers and governments work to cut carbon emissions that lead to global warming, according to a forecast from BloombergNEF, Bloomberg LP’s primary research service on energy transition.
In the report, “EVs and New Mobility: Trends to Watch in 2020,” BNEF analysts estimate that global car companies will sell about 2.5 million electric vehicles this year, 20 percent more than in 2019.
While China will continue to dominate the global electric car market, the country’s decision to reduce subsidies will help shift growth momentum to Europe.
New models from companies such as Volkswagen Group will help Europe sell 800,000 electric cars by the end of the year, up 60 percent from 2019, according to BNEF.
“The long-term future is really bright, but in the short term we’re expecting growth to be relatively slow,” said Colin McKerracher, an analyst at BloombergNEF.
“You’re still in the middle of this transition, from a market driven by direct subsidies toward one driven by a combination of real consumer demand and other big policy mechanisms.”
Crucial to the rollout are the continuing cost cuts for lithium ion batteries. Prices will hit about $135 per kilowatt hour on average this year, about 13 percent lower than in 2019 and 89 percent lower than a decade ago.
Further cost cuts will come as the scale of battery production increases and the design of battery packs becomes more efficient.
Public chargers will hit 1.2 million, up from 880,000 in 2019, as governments and energy companies work to expand the critical infrastructure.
This year could also bring crucial steps for the electrification of planes and boats. While cars have been relatively easy to run on batteries, air and marine travel is trickier. As pressure builds on airlines to reduce emissions, 2020 could see major investments in battery and hybrid technologies that could help the development of all electrified transport.