Global electric vehicle (EV) sales continue to grow, but policy changes in the United States are significantly slowing the country’s adoption rate, according to BloombergNEF’s (BNEF) annual global outlook for the sector released on Wednesday. This marks the first year that BNEF has reduced both its near-term and long-term passenger EV adoption outlook. “Policy changes in the US are the biggest factor, with national fuel-economy targets being rolled back, supportive elements of the Inflation Reduction Act either being removed or under threat, and the potential removal of California’s ability to set its own air quality standards,” BNEF stated in its 2025 Electric Vehicles Outlook.
Global EV Sales Trends
Despite the slowdown in the US, electric vehicles set global sales records last year, with emerging markets in Asia and Latin America showing rapid adoption rates, according to Colin McKerracher, lead author of the report and BNEF’s head of clean transport and energy storage. “Despite these positive tailwinds, we see slower EV adoption in the short and long-term due in large part to the changing landscape in the US,” McKerracher said in a statement.
Impact on US EV Market
BNEF now expects passenger EV sales in the United States to rise from 1.6 million this year to 4.1 million in 2030, making up 27% of total passenger car sales by the end of the decade. This represents a significant reduction from last year’s forecast, which had anticipated EVs would make up 48% of sales by 2030. “It results in cumulative EV sales between now and 2030 being 14 million units lower,” according to the report.
Battery Industry Implications
The impact on the battery supply chain is substantial. BNEF’s global battery demand outlook between 2025 and 2035 has fallen 8% compared to last year’s projections, equating to 3.4 TWh fewer batteries. The majority of this reduction (2.8 TWh) can be attributed to decreasing passenger EV sales in the US, where demand is now 42% less than previously forecast. This dynamic is leading to continued overcapacity in the battery manufacturing sector, “driving battery costs lower and intensifying market competition,” BNEF noted. In China, average utilization of battery plants has dropped below 50%.
Long-term Outlook
While the near-term outlook has dimmed, BNEF remains optimistic about long-term growth for battery metals as EVs are adopted across all segments. “Despite a near-term slowdown, the long-term growth for battery metals remains strong,” the report concluded.
