Sales of electric and plug-in hybrid vehicles could surge by at least 17% to over 20 million cars in 2025, according to a Tuesday forecast from Rho Motion. Bolstered by a continuation of China’s trade-in subsidies.
Car sales in Europe, the world’s second-largest EV market, will return to growth as CO2 emission targets are enforced, and more affordable models enter the market, though the rally will be more gradual than in 2023, said Iola Hughes, Head of Research at Rho Motion.
2025 is set to be a transformative year, as Europe’s new emission target aims to encourage EV adoption and China expands its subsidies, while the new U.S. administration under President Donald Trump dials back its electrification goals.
Rho Motion estimated that EV sales in China will surpass the 17% forecast for 2025, boosting its market dominance reinforced by the subsidies. China’s EV sales soared by a record 40% to 11 million.
In Latin America, Chinese EVs dominate with over 80% market share, confirming its 2024 trends. Chinese EV sales would continue to make gains in the Asia-Pacific region and other emerging markets, said the firms.
The firm also put 15% sales growth in its forecast for the European market. In 2024, 3 million EVs were sold in Europe.
Carmakers could also be fined around EUR 10 billion ($10.51 billion) for failing to meet EU emission targets, regardless of carbon credit purchases from EV makers, said the firm.
The firm’s previous estimates put the EU fine at EUR 15 billion, but it did not account for industry development and new emission pools.
U.S. EV sales could grow 16% in 2025 with limited impact from Trump’s focus on fossil, although there could be long-term consequences, such as a 47% plunge in EV battery demand by 2040 in a worst-case scenario.
