Even slow-moving oil giants are now forecasting next decade’s EV revolution
27 April 2017
27 April 2017
Oil major France’s Total SA has announced that electric vehicles (EVs) may make up almost a third of new car sales by the end of the next decade. It is the latest overture from the famously EV-pessimistic sector, following Royal Dutch Shell’s admission in March that global oil demand could peak, due to the EV boom, in the late 2020s.
Chief Energy economist at Total SA Joel Couse said that EVs will make up 15-30% of new vehicles sold worldwide by 2030, in the most optimistic forecast yet by the slow-moving oil industry.
Speaking at the Bloomberg New Energy Finance conference on Tuesday, he said that by 2030 demand for oil-based fuel will have reached its peak, and will then flatten out at a steady demand. Oil will always be demand in other sectors, such as for the making of plastics. However, significantly, Couse said that after that, oil demand ′may even decline.’
It is not clear from the event whether Couse included both plug-in hybrids as well as all-electric vehicles in his forecast, but it is thought through analysing the figures that it includes all plug-in electrified vehicles.
On its part, Royal Dutch Shell has already begun preparations for the predicted upset in its core business by establishing a new business unit to identify clean technology growth areas where it could be most profitable once oil demand begins to soften.
With current EV sales at 1%, skyrocketing to 30% of global auto sales in such a short time period as Couse forecasts seems highly unlikely. However, major policy drives are expected to accelerate a more natural maturing of the EV market – with costs falling to mass-market thresholds much sooner than would have occurred under market forces alone. Battery prices are currently falling in price by about 20% a year.
China in particular is undertaking hardball interventions in the market with production quotas.
Other analysts feel that as EV technology matures and it improves to acceptable levels in current areas of weakness, such as range and charging times, the next-generation of EVs will make their internal combustion engine equivalents look (and sound) old-fashioned.
An avalanche of EVs is set to launch around 2020, with dozens of new models in every major segment from Mercedes-Benz, Volkswagen, General Motors and others. As all markets are covered, EVs could quickly become seen as the de facto choice. Tech sectors have witnessed sudden revolutions in technology before, such as the near-instant switch to touchscreens in the mobile industry with the introduction of the iPhone. OEMs need to be prepared in case of such a paradigm change.