Battery electric vehicles (BEVs) last year emerged as one of the few success stories for the global automotive industry as their market share doubled from 3.1% to 6.0%.
JATO Dynamics said the global shortage of semiconductors created an opportunity for BEVs and SUVs, as OEMs were forced to priortise their most profitable models, while production of petrol and diesel models declined as a result of the crisis.
In 2021, the popularity of BEVs soared among consumers in Europe and China, and began to gain traction in North America, however other markets around the world continued to lag behind.
Thanks to sustained local demand and a focus on popular models, BEVs became a key player in the Chinese market. In 2021, China was the major driver of growth for the segment, accounting for approximately half of the global demand. While Chinese OEMs have developed a proven formula for their domestic BEV market, they have been unable to generate sales at the same level in other regions.
In Europe, growth was driven by OEMs with an existing footprint in the region, such as Volkswagen Group and Stellantis, as well as new players like Tesla. Government incentives continued to play a crucial role in supporting the uptake of BEVs. While the expanded offering from OEMs, combined with growing awareness of the environmental benefits, meant that consumers came to view these vehicles as serious alternatives to the traditional petrol and diesel favourites.
The BEV market in North America also made progress but a number of factors have slowed significant adoption. Historically, the market has been shaped by consumer demand for SUVs and trucks with high fuel consumption. But the emergence of brands such as Tesla, and the global increase in energy prices is now underpinning a shift in the market.
Thanks to the arrival of the Model 3 in North America in 2018, and China and Europe in 2019, Tesla has been able to hold its position as the world’s leading BEV manufacturer. While the Model Y has also been a success, Tesla has been able to maintain the attention of consumers and continue its gradual expansion with a relatively limited model range.
Teslas impressive growth has opened up the market for European and American OEMs that have sought to establish themselves in the BEV segment, and they are beginning to see a return on their investment. Similarly, Chinese OEMs can also thank Tesla for its role in increasing the consumer awareness of BEVs globally.