Key facts
- High oil prices and shipping disruptions are accelerating the adoption of electric vehicles (EVs) in developing markets.
- Chinese automakers are experiencing a surge in global EV exports, particularly to Asia and Africa.
- EV sales are outpacing the development of charging infrastructure in many regions.
- Governments are increasingly embracing electrification to reduce oil import costs and fuel subsidies.
- Global electric car sales are expected to continue growing significantly in the coming years.
The war in Iran and subsequent disruption of shipping through the Strait of Hormuz have significantly impacted global oil and liquefied natural gas supplies, accelerating a shift towards electric vehicles (EVs) in developing nations. This surge in demand for EVs, particularly from Chinese automakers, is creating an opportunity across Asia and Africa as drivers seek to escape volatile fuel prices and governments aim to reduce oil import costs and subsidy burdens.
Global exports of Chinese EVs reached a record $9.4 billion in April, with significant increases seen in countries like Australia, Brazil, Southeast Asia, and East Africa. In May, China exported approximately 435,000 passenger EVs and plug-in hybrids, more than double the previous year. This trend is supported by government initiatives, such as Laos' ban on fuel-powered vehicle imports until 2026, and a general embrace of electrification to curb oil dependency.
Globally, one in four new cars sold last year were electric, and sales are projected to reach 23 million in 2026, representing nearly 30% of all cars sold. Chinese automakers are leading this charge, supplying about 60% of the world's electric cars and expanding into Europe, Africa, and Latin America. Automakers like Geely Auto and VinFast have reported strong sales growth, with users like Nguyen Thien Bao in Vietnam experiencing significant cost savings on his VinFast electric motorbike.
However, the rapid adoption of EVs is outpacing the development of charging infrastructure. In Thailand, there are roughly 92 battery EVs and plug-in hybrids for every public charging location, and while installations are accelerating, challenges remain. Drivers in Bangkok are reportedly considering returning to fuel-powered cars due to strained charging networks. Malaysia has seen growth in public fast chargers, and Indonesia has established over 4,500 stations. Ethiopia, despite banning non-EV imports, has a significant deficit in charging stations, with many still under construction.