In recent years, electric cars have become increasingly relevant worldwide. They have experienced steady growth in many markets so far. But the year 2024 could be tough, for example in Germany, Europe’s largest car market. The Association of the Automotive Industry (VDA) expects sales of purely battery-powered vehicles (BEVs) to fall from 524,000 units last year – more than in any other European market – to 451,000 units this year. That means a minus of 14 percent.
BYD overtakes VW as the best-selling car brand in China
German market experiences decline in sales
According to Electrek, around 15 million BEVs are expected to be on the road in Germany by 2030. The decline in sales is a bad sign. This development is due to a number of factors – primarily the fact that Germany allowed the subsidy program for electric cars to expire in December, a full year earlier than expected. Added to this are inflation, rising car prices and inadequate charging infrastructure.
The forecast says Germany will produce 1.45 million electric cars this year, but much of that production is earmarked for exports. After China, Germany is the world‘s second largest manufacturer of BEV cars – but when you consider that China is expected to produce 6.6 million BEVs in 2023, while Germany only has 1.2 million, that’s a pretty big difference. For comparison: 1.1 million electric cars were produced in the USA last year, according to data from VDA and S&P Global Mobility.
Electra: French e-charging network company receives 304 million euros
Austria is one of the largest growth markets in Europe
It remains to be seen whether the same development will occur in the Austrian market. After all, there was still strong growth in this country until recently. According to a study by PwC, there was once again the strongest growth (39 percent) in the market for electric vehicles (BEVs, plug-in hybrids and hybrids) in 2023, with around 48,000 vehicles sold. With a market share of around 20 percent, BEVs could soon replace the full hybrid (21 percent market share) as the most popular drive in Austria. In a European comparison, Austria recorded the fifth largest increase in new BEV registrations in 2023 and is therefore well above the EU average.
But the PwC experts’ forecast for the global electric car market this year is not exactly positive either. “Although the global e-mobility market will remain large in 2024, there are reasons for caution. Lower government subsidies, supply chain problems due to geopolitical conflicts and uncertainties regarding the commitment of future governments, for example in the USA, to the electrification of vehicles could slow down the success of e-mobility,” explains Johannes Schneider, partner at PwC Strategy & Austria. As early as the fourth quarter of 2023, it became apparent that the boom would not last much longer (we reported).
The electric car boom appears to be slowed down in 2024
Shares of global electric car companies are plummeting
At the moment, the stock market doesn’t really believe in electric car companies. The prices of Rivian (-24%), Lucid (-10%), VinFast (-14%), Xpeng (-40%), BYD (-16%), Nio (-33%) and Tesla (-24% ) have lost a lot this year – and towards the end of 2023, with a few exceptions, share prices fell sharply because of the poor outlook. The mood is so bad that Renault canceled the IPO of its electric car division Ampere, and VW stopped looking for external investors for its battery subsidiary PowerCo.
Business Insider even speaks of an electric car stock bubble that now appears to be bursting. Formerly high-flying stocks like Rivian, Lucid and Xpeng are now down 80 to 90 percent from their highs. In addition, the stock indices for electric cars lag those of other automobile manufacturers by between 50 and 80 percent. Today, almost all electric car stocks that have gone public or merged with SPACs in the last five years are below their starting price – many even significantly.
Of course, this has serious effects on various markets globally. Australia’s largest lithium mining company recently cut back production because of exactly this development, reports the Guardian. Perth-based IGO has confirmed it is reducing production at its Greenbushes operation near the tiny Western Australian logging and mining town after which the mine is named, due to subdued demand for battery-grade lithium chemicals. Although the prospects for lithium are good in the long term, the markets are being watched with caution. Since the end of 2022, lithium prices have fallen by more than 80 percent.