EVs are being driven much further than fossil cars – and battery prices are still plunging

One of the really big myths about electric vehicles circulated on mainstream and social media is that they are only good for short trips, or city driving. No one in their right mind would take them on long journeys, or so the claim goes.

Well, not really. One of the most authoritative reports on the EV industry, from BloombergNEF, includes a fascinating graph highlighting how in many countries EVs are driven far more than their fossil fuel counterparts.

And for good reason. EVs are more efficient – nearly all the energy created by the burning of petrol or diesel is lost as waste heat – and EVs are cheaper to run, because charging is cheaper and cleaner than topping up with liquid fuels, and they require less maintenance.

The graph above underlines just how much difference is there is in kilometres driven in EVs and plug in hybrids (PHEVs) and internal combustion engine cars.

In China, the world’s biggest car market and where EVs are nearing a 50 per cent share of new car sales, EVs are being driven 66 per cent further each year than the average ICE car. In Norway, which has the highest penetration of EVs of any country with a market share of 90 per cent of new car sales, the difference is 40 per cent.

Even in California, the original home of Tesla, the kilometres driven by EVs is higher than ICE cars, although the rest of the US doesn’t fare so well.

In fact, EVs in that country are driven 38 per cent less distance over a year than ICE cars, which may be the result of that country’s obsession with really big cars, the pushback by the big car makers such as Ford and GM, and which could explain the push back against smaller, cheaper Chinese made EVs and the imposition of huge tariffs on those imports.

Does anyone know what the data shows for Australia, which has a similar share of EVs and a similar infatuation with big cars, and long distances – although so many have shown that EVs can easily do laps of Australia and other long distances.

The BNEF report includes some other interesting observations the counter the prevailing wisdom on mainstream and social media.

One is that the claimed collapse of the EV market is not actually a thing. Yes, sales have fallen in some markets, such as Italy, Japan and Germany – the homes of some of the world’s most notable car brands – but they are gaining in most other countries, even including the US, which has grown 3 per cent in the first quarter, year on year.

Spectacular growth is being witnessed in the huge China and India markets, and France and the UK are also doing well.

“EV sales are headed for another record year,” says one of the lead authors, Colin McKerracher.

“Despite the headlines to the contrary, global EV sales continue to grow and are set to rise about 20 per cent this year. Combustion vehicle sales peaked in 2017 and have no real route back to that peak.”

Another interesting part of the market is the commercial vehicle market, and the heavy vehicle market.

“Electrification of commercial vehicles is a bright spot, with just under a million sales expected this year,” McKerracher says. “Other areas like two/three wheelers and buses have already achieved high levels of EV adoption.”

BNEFs outlook is for continued strong growth, with 20 per cent of light truck sales to be fully electric in 2027, 9 per cent of medium and heavy duty truck sales and 52 per cent of bus sales. Not that you would notice in Australia.

BNEF predicts heavy duty trucks sales will be 18 per cent electric by 2030, and 43 per cent by 2040.

“Electric heavy trucks become economically viable for most use cases by 2030,” it says.

“In heavier segments, battery electric trucks are mostly used in urban duty cycles initially. But their economics improve even for long-haul routes and around 2030 approach those of diesel powertrains. ”

One of the big reasons is the falling costs of battery storage, and the fact that are going to continue to fall.

“Battery prices in China are plummeting,” McKerracher says. “Year-to-date cell prices for LFP cells in China are $US53/kWh (which is down from the 2023 global average price of $US95/kWh). Overcapacity and low raw material prices are a factor, but processes and technology are also still improving.

“We’re nowhere near the end of how good this technology can get.”