Once you get to 5%, change is inevitable. In the last six months, more than 5% of the new cars sold in America have been electric vehicles (EVs). That means accelerated EV sales are coming.
That’s the conclusion of a new analysis from Bloomberg.
Prediction Based on 18 Other Countries
“If the U.S. follows the trend established by 18 countries that came before it, a quarter of new car sales could be electric by the end of 2025,” the report says.
The 5% threshold, Bloomberg says, “signals the start of mass EV adoption, the period when technological preferences rapidly flip.”
Before the 5% line, analysts say, adoption is sporadic and slow. Afterward, “rapidly accelerating demand ensues.”
Bloomberg analysts say the pattern has held in 18 countries in Europe and Asia. They range in population from tiny Iceland (about 366,000 people – fewer than Bakersfield, California) to China (1.4 billion, or more than four Americas).
Every one of those countries has an incentive program to help its drivers go electric. Some are larger than America’s $7,500 federal tax rebate for EV purchasers, and some are smaller.
Other Research Makes Similar Points
The numbers jibe with those of another recent study.
Consumer Reports this month released a report finding that 36% of Americans are planning to buy or are “seriously considering” buying an EV. Another 35% said they were open to the idea.
CR’s research found that Americans grew more likely to consider an EV as their exposure to the cars grew. Forty-four percent of respondents said they’d seen an EV in their own neighborhood within the last month.
Nearly Every Manufacturer Has One
Five years ago, there were fewer than 10 EVs for sale on the U.S. market. By the end of 2022, we expect to see at least five dozen. Nearly every automaker has released or will release an EV in 2022.
Even those still holding out have one in the works – Dodge plans to unveil an “electric muscle car” next month. Some manufacturers, including Volvo and Audi, have announced plans to sell nothing but electric cars by the end of the decade. Others, like GM, have said they plan a mostly electric lineup but are not committed to fully eliminating gas-powered cars.
Manufacturers, Bloomberg says, face their own tipping point – “In Europe, once 10% of an automaker’s quarterly sales go electric, the share triples in less than two years.”
Gas Will Stick Around for a Long Time
Even if the U.S. has crossed a tipping point, we should point out, gas stations won’t start closing en masse. Americans replace our cars slowly. The average car on America’s roads is 12.2 years old. With more than 276 million private vehicles registered in the U.S., it will take a long time for the internal combustion engine to fade from prominence.
Ed Morse, Citigroup’s global head of commodity research, told CBS News this week that he projects, “The world’s appetite for oil will peak by the end of the decade.”
