Russia’s invasion of Ukraine has created further pressures, since Russia supplies 20% of global battery-grade nickel. All else being equal, the cost of battery packs could increase by 15% if these prices stay around current levels, which would reverse several years of declines. Prices for lithium, a crucial mineral for car batteries, were over seven times higher in May 2022 than at the start of 2021, and prices for cobalt and nickel also rose. In the longer term, greater efforts are needed to roll out enough charging infrastructure to service the expected growth in electric car sales, the report says. In the short term, the greatest obstacles to continued strong EV sales are soaring prices for some critical minerals essential for battery manufacturing, as well as supply chain disruptions caused by Russia’s attack on Ukraine and by continued Covid-19 lockdowns in some parts of China. Under its new Ministerial mandate, the IEA is working with governments around the world on how to strategically manage resources of critical minerals that are needed for electric vehicles and other key clean energy technologies.” “Policy makers, industry executives and investors need to be highly vigilant and resourceful in order to reduce the risks of supply disruptions and ensure sustainable supplies of critical minerals. The success of the sector in setting new sales records is extremely encouraging, but there is no room for complacency,” said IEA Executive Director Fatih Birol. “Few areas of the new global energy economy are as dynamic as electric vehicles. Five times more electric car models were available globally in 2021 than in 2015, and the number of available models reached 450 by the end of 2021. A growing number of countries have ambitious vehicle electrification targets for the coming decades, and many carmakers have plans to electrify their fleets that go beyond policy targets. Sustained policy support has been one of the main reasons for strong electric car sales in many markets, with overall public spending on subsidies and incentives doubling in 2021 to nearly USD 30 billion. By contrast, electric car sales are lagging in most emerging and developing economies where only a few models are often available and at prices that are unaffordable for mass-market consumers. The median price of an electric car in China was only 10% more than that of conventional offerings, compared with 45% to 50% on average in other major markets. Alongside lower manufacturing costs, this has significantly reduced the price gap with traditional cars. Chinese electric cars are typically smaller than in other markets. Sales also grew strongly in Europe (increasing by 65% to 2.3 million) and the United States (more than doubling to 630 000). In China, electric car sales nearly tripled in 2021 to 3.3 million, accounting for about half of the global total. The number of electric cars on the world’s roads by the end of 2021 was about 16.5 million, triple the amount in 2018. Despite strains along global supply chains, sales kept rising strongly into 2022, with 2 million electric cars sold worldwide in the first quarter, up by three-quarters from the same period a year earlier. Sales of electric cars (including fully electric and plug-in hybrids) doubled in 2021 to a new record of 6.6 million, with more now sold each week than in the whole of 2012, according to the latest edition of the annual Global Electric Vehicle Outlook. Electric car sales powered through 2021 and have remained strong so far in 2022, but ensuring future growth will demand greater efforts to diversify battery manufacturing and critical mineral supplies to reduce the risks of bottlenecks and price rises, according to the International Energy Agency.
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