Electric vehicle (EV) sales are projected to increase by 25% globally in 2025 compared with 2024, according to a market research firm.

Battery electric vehicles continue to account for the majority of sales, representing about 60%, while plug-in hybrids are expanding in Asia, particularly in China through range-extended models.

The trajectory of EV growth is no longer uniform. China remains the largest market, but adoption in emerging markets is accelerating faster than previously anticipated, often differing from the progression seen in established automotive regions.

China is expected to contribute 67% of global EV sales in 2025, with Europe accounting for 17%. The outlook for the United States has weakened due to regulatory uncertainty, reduced incentives, and tariffs.

Thailand has overtaken the United States in EV adoption, and Brazil has surpassed Japan, indicating a shift in adoption patterns away from high-income markets being the earliest to transition to electrification.

China targets emerging economies

Chinese automakers are expanding into overseas markets with lower-cost, mass-market EVs. In Brazil and Thailand, Chinese brands hold a significant share of EV sales.

Lower battery costs and large-scale production have enabled EVs in China to become less expensive than comparable internal combustion engine vehicles, which has not yet occurred in other major markets.

EVs represented 42% of global passenger vehicle sales in 2024, with projections estimating a rise to 70% by 2040.

Growth is slowing, with 2025 expected to record 25% growth compared with much higher rates in earlier years. Forecasts suggest that annual increases will fall to single digits by 2030.

This reflects a transition from early adoption towards market saturation in developed economies, while growth in emerging markets continues to accelerate, according to the research firm.

Developed markets stalling

Some established automakers have reduced their electrification targets that were set earlier in the decade. The research firm noted that global EV sales targets for 2030 among traditional original equipment manufacturers are now lower than those reported in 2023.

In the United States, anticipated policy changes, the reduction of tax credits, and additional tariffs are expected to further weaken EV adoption prospects by 2030.

Charging and infrastructure challenges

Range-extended EVs have expanded rapidly in China, supported by larger battery capacities and reduced reliance on petrol. These vehicles provide an option for consumers concerned about charging availability outside major cities.

Battery costs declined by 20% on average in 2024, with China reporting even greater reductions. Lower costs have contributed to broader affordability and supported increased adoption.

Fast-charging technology is also advancing. BYD has introduced a system that could reduce charging times to five minutes. However, charging infrastructure development remains limited in several regions. In the United States, public charging networks are sparse and costly compared with conventional refuelling.

China installed several hundred thousand chargers in the past year but will require ongoing large-scale expansion to keep pace with demand.

The EV market is diverging, with China and some emerging economies advancing adoption through cost reductions and policy support, while developed markets face slower growth due to political and economic constraints.

Without measures such as industrial policy, localised production, or investment in infrastructure, adoption is likely to remain uneven across different regions.