The global new energy vehicle market is growing rapidly. In 2023, global new energy passenger vehicle sales exceeded 13 million units, a 35.7% increase year-on-year. These vehicles accounted for 16% of the overall market. China, the United States, Germany, the UK, and France lead the market. China’s sales represent 68% of the global market, showing its dominance.
McKinsey forecasts that the global market will surpass 80 million units by 2030. The penetration rate of new energy vehicles will reach 50%, with 240 million vehicles in total, close to 20% of ownership.
US Market Policies on New Energy
In December 2023, the US Inflation Reduction Act defined Foreign Entities of Concern (FEOC), including China, Russia, North Korea, and Iran. This act limits China’s entry into the US new energy vehicle market, focusing on technology licensing and joint ventures.
Reuters reported that President Trump’s transition team plans to remove the $7,500 tax credit for electric vehicle purchases. This could significantly impact the US auto industry’s electrification.
European Market Policies
The European Union introduced the EU Batteries and Waste Batteries Act, which mandates carbon footprint calculations for electric vehicle batteries. From July 1, 2024, manufacturers must issue carbon footprint statements.
In 2024, most European countries will reduce incentives for new energy vehicle purchases. Germany will cancel incentives, while France and the Netherlands will see reductions. France introduced carbon emission assessments but maintained subsidies, though fewer models will be subsidized. The Netherlands cut subsidies by 13%. These policy changes could slow the adoption of new energy vehicles in Europe.
Southeast Asian Market Policies
Southeast Asia is in the early stages of its energy transformation, with some countries offering reduced or exempted import tariffs on electric vehicles.
Thailand, a hub for the Southeast Asian auto industry, is particularly active in supporting the new energy market. By 2030, electric vehicles will make up 30% of the country’s production. The EV3.0 plan, launched in 2022, offers tax reductions on electric vehicles based on battery specifications. However, manufacturers must match imports with local production to benefit from these incentives.
Latin American Market Policies
Many Latin American countries have accelerated their energy transformation with new policies and investments. Brazil aims to position itself as a leading automotive country in South America, with clear policy goals. Mexico’s near-shoring strategies are influenced by US policies, with political factors affecting local investment and factory construction.\
Conclusion
Countries worldwide are introducing policies to stimulate new energy vehicle consumption and build their own industrial supply chains. However, trade protectionism and anti-globalization are rising. In addition to higher tariffs, the US and the EU are creating high barriers for battery imports, pushing for local supply chains.
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