EV sales to exceed 20 million units in 2025 — report

The global electric vehicle (EV) market is set for another year of robust growth this year, with sales expected to exceed 20 million units, an 18 percent hike from 2024, according to Rho Motion, a leading EV research firm, on Tuesday.

This growth comes amid shifting legislative landscapes in key regions, with China leading the charge, the EU enforcing stricter emissions standards, and North America adjusting to policy changes under the Donald Trump administration.

Describing 2025 as "the year of legislation," Iola Hughes, head of research for Rho Motion, said: "The EU is seeing emission targets come into place, Trump’s presidency promises change for the US, and China continues the popular trade-in scheme. Still, we anticipate a steady year of growth across all regions, with China continuing to lead the charge."

China is projected at the forefront of the EV revolution, with projected sales of 12.9 million units in 2025, marking a 17 percent increase from 2024.

The country’s dominance is bolstered by its aggressive expansion into international markets, with major manufacturers such as BYD and Great Wall Motors establishing production facilities abroad, including in Brazil and Hungary.

Domestically, the continuation of a trade-in scheme for older vehicles will sustain high levels of consumer demand in China, the report noted.

"The next stage for the mature EV market in China is for more consolidation of manufacturers and beyond this year, we can expect the country to tip over the 50 percent market saturation of EVs versus ICE (internal combustion engines)," it said.

Companies focus on affordable cars

The European market – the EU, European Free Trade Association, and the UK— is predicted to recover from a difficult 2024, during which sales declined by 3 percent compared to 2023.

New emissions standards coming into effect are expected to drive a 15 percent year-on-year growth, with 3.5 million units projected to be sold in 2025.

Despite this recovery, European automakers face significant hurdles, including the risk of up to €10 billion ($10.4 billion) in fines for failing to meet stringent emission targets.

Many car manufacturers focus on new smaller and affordable EV models priced below €25,000 ($26.000) to boost adoption among cost-conscious consumers.

In the US and Canada, the EV market is foreseen to grow by 16 percent in 2025, with sales at 2.1 million units.

The transition to President Donald Trump’s administration brings uncertainty to the sector, particularly regarding potential policy shifts such as the removal of EV tax credits.

However, the immediate impact on 2025 is expected to be minimal, as manufacturers have already set their plans for the year.

"Following his inauguration, President Donald Trump’s legislative agenda is in full swing and though the removal of EV tax credits is going to impact the long-term market, little change will be seen this year as the electrification of vehicles is here to stay," Hughes said.