Electric new sales S-Curve

Ive been seeing a lot of analysis that the transition from ICE to Electric cars will take on a S-Curve shape, and 5% EV sales is the tipping point to join the S-Curve, but none of those graphs ever have any X axis... like how many years does the S curve take. Does it need consistent subsidies per country etc.

So I decided to pull a few country data in different markets with different EV stimulus's to see if there is any alignment of the S-curve, and what can we expect in Australia, since we ticked over 5% this year (now over 8%).

I chose these countries:
Norway - The leader which is already at 83%, and will show if there really is an S shape.
Iceland - The next biggest penetration of EV cars for new sales, although last year there was a slowing of growth.
France - A typical European country.
China - The big player in Asia.
and little old Australia.

Here it is. Each country has their own year they hit 5%, and so I have lined up that transition point to be the same year (year 10 as shown below).

Conclusions:
It really is an S curve.
Every country is following Norway's lead pretty accurately.
Norway is planning to stop selling ICE cars in 2025 (year 21 in this graph) which is 11 years after they had the 5% transition of sales.
This means that its very likely Australia will also stop selling ICE cars in 11 years which is 2034.
Policy variation between countries doesnt make much difference

 

[Hairyman]

We seemed to stall a bit last quarter, but I’m not sure what the impact the Tesla delivery issues had. Next quarter will tell.

I also wonder if our geography will have much of an impact. We are spread out, but TBH the majority are just rattling around in costal cities.

Having said that we are an high income country and are tracking along in a very similar fashion to the others.

The Norwegian government policies may be another important differentiating factor.

 

[cafz]

Policy variation between countries doesnt make much difference

Not sure the data really says that - eg. it looks like France took 3 years to get to the same point after 5% that Norway did in 1.5 years.

 

[meloccom]

Another related and interesting phenomenon is Ethiopia banning internal combustion vehicles immediately. Story
There are a number of countries struggling with the cost of fossil fuels and their drain on the balance of trade and access to foreign exchange.
If this strategy is successful, there may be a number of countries in a similar position doing the same. The biggest issue will be a supply of EVs at prices that are affordable for such countries.
A country in a similar position to Ethiopia is Sri Lanka. I visited Sri Lanka last year and the country relies heavily on second hand Japanese Domestic Vehicles and already has a small public charging network and significant renewable energy from hydroelectric power.
I can see some of these lower end EVs from China playing a big role in the supply of cars to these countries.
No idea if it will be successful but it will be interesting to watch, perhaps the S curve in those countries may look more like a Z!

 

[MikeChicago]

I hate to say it but Americans are notoriously shortsighted. There is an inverse relationship between the cost of gas and sales of ICE SUVs and Trucks. The cheaper the gas, the more we buy gas guzzling vehicles.

Our country has a collective memory of a goldfish. It’s maddening.

 

[Exadios]

The 'S' curve is simply a manifestation of the Central Limit Theorem.

 

[bruce4000]

I hate to say it but Americans are notoriously shortsighted. There is an inverse relationship between the cost of gas and sales of ICE SUVs and Trucks. The cheaper the gas, the more we buy gas guzzling vehicles.

Our country has a collective memory of a goldfish. It’s maddening.

True but if and when EV cost less to purchase than ICE, the transition will happen in most parts of US. Will take longer for big pickups due to battery costs.

 

[cafz]

It's the Logistic Curve, which has been used to model population growth for almost 200 years.

 

[Vostok]

The 'S' curve is simply a manifestation of the Central Limit Theorem.

Not really. The S-curve to illustrate the adoption of something over time is not a random Gaussian process. It’s an ordered process, where what happens up to time X affects what happens after time X.

 

[fhteagle]

Interesting graph.

RethinkX has a lot of material covering market disruption by a new technology replacing an incumbent. Not all of it is perfectly scientific or accurate, but makes for a decent model of the world, especially for the incumbents to understand how fast their cheese gets moved, and to pay attention to small initial movements of the market.

Their model talks about three phases roughly: an early exponential growth phase (first ~10%), a linear-ish mid phase for ~80% of the changeover, and an asymptotic late phase for the last ~10%. Each phase is in the mid single to low double digit year range.

I think all the garbage journalism about "slowing EV sales" in the US is failing to recognize that we are changing from the high YoY early phase to the linear-ish middle phase. We weren't going to have triple, even high double digit percentage YoY growth forever. I think settling into around 1% per quarter average market share increase for BEVs is very plausible for the US.

Variables that can move the adoption rate forward and backward somewhat:
- Government policy, incentives, taxes, registration fees, etc
- Fossil fuel supply shocks, especially from arbitrary actions by OPEC+ and other oiligarchs.
- Charging infrastructure rollout, maintenance, standardization, etc
- Media hype, FUD, etc
- Entrenched stealerships and their outsized influence on politics and consumer buying decisions
- Technology advancements
- Supply chain and mineral availability
- Consumer migration into / through EREVs on their way to BEVs
- Utilities adopting and incentivizing smart charging and V2G for bulk power and grid stabilization services
- First, second, and third party repair services availability

But I do not see any technical or fundamental barriers to going 95+% electric for all modes of surface transport within 1-2 decades globally. Small islands could be there faster, construction in very remote areas and long distance shipping will hold onto liquid fuels longer. Aviation is a whole different ballgame though.

 

[LarryClay]

You need to account that for the last decade whole world has been in a monetary expansion phase with resulting boom cycle.
Now we are entering into bust cycle aka known as recession.
In China recession is allready a fact, same goes for UK and Japan. Russia is in deep recession due to sanctions allready for a year.
Rest of the western world will enter into recession phase during this and next year.

So the flattening curve of EV sales is also partially result of the world entering into recession phase. Also ICE car sales are falling.

 

[gazpachopolice]

Another related and interesting phenomenon is Ethiopia banning internal combustion vehicles immediately. Story

Ethiopia is a floundering communist dictatorship that's running out of money through economic mismanagement and fighting a whole bunch of wars/insurgencies simultaneously. Forcing an immediate switch to EVs in a country where GDP/capita is under $1000/year and power generation per capita is under 80 kWh/year (= one charge of a Model 3 LR) is madness and completely unworkable, they'll just keep smuggling in used ICE clunkers like every other poor African country and greasing the palms of the bureaucrats who are supposed to enforce the policy.

 

[Vostok]

Variables that can move the adoption rate forward and backward somewhat:

One thing left out of that list… word of mouth / personal experience. As more people buy EVs, others they know who haven’t done this get exposed to more EVs, given rides in them etc. This ‘normailises’ EVs and also impacts their perceptions and buying decisions.

 

[Vostok]

Forcing an immediate switch to EVs in a country where GDP/capita is under $1000/year and power generation per capita is under 80 kWh/year (= one charge of a Model 3 LR) is madness and completely unworkable

So you know Ethiopia better than Ethiopians? Fascinating. People in Ethiopia won’t continue to buy fossil-powered vehicles when the country doesn’t have enough money to reliably import liquid fossil fuels at affordable prices.

You seem to think “EV” means “4 wheeled vehicle”. In poor countries a lot of people use other forms of combustion-engine vehicles - scooters, mopeds, motorcycles. There has already been a very rapid adoption of battery electric scooters in poor countries because of their much lower operating and maintenance cost. And the ability to recharge them using solar panels and not rely on a dodgy, expensive, unreliable and corruption-riddled fossil fuel logistics chain.

I was in Vanuatu once 6 months after a cyclone wiped out much of the infrastructure on Efate. People on the northern side of the island were still waiting for the grid to be reconnected. So what had villages done? Purchased solar panels and small batteries so they could at least keep the lights on and run small appliances. Ads for solar panels and batteries were everywhere in local papers.

It showed the Western notion of a “centralised reliable electricity grid” is a nonsense in many developing countries, and energy independence through solar and battery microgrids makes a lot more sense. People can have power now, rather than waiting 6 months for an existing grid to be fixed following the latest natural disaster, or waiting 10 years for a non-existent grid to be eventually built to wherever they are living.

It’s Western exceptionalism to think that third-world countries will be the last to adopt “modern” technologies.

 

[gazpachopolice]

So you know Ethiopia better than Ethiopians? Fascinating. People in Ethiopia won’t continue to buy fossil-powered vehicles when the country doesn’t have enough money to reliably import liquid fossil fuels at affordable prices.

That's because, like almost everything else in Ethiopia, importing petroleum is limited to an incompetent government monopoly (EPSE). But instead of tackling the actual supply issue, they're hamhandedly trying to cut demand. Remember, this is the same country that's trying to fight inflation and black market currency exchange (which offers rates 2x higher than the official rate) by forcing state retailers to accept only digital payments, which is working about as well as you'd expect in a country with one of lowest mobile phone penetration rates in Africa (50%) -- and, surprise surprise, another incompetent government monopoly (Ethio Telecom) responsible for that one too.

You seem to think “EV” means “4 wheeled vehicle”.

The government ban applies only to automobiles, you can still legally import all the two-stroke ICE scooters you like.

More generally, I've spent years of my career working developing countries, and I think we're actually in agreement that bottom-up efforts like village solar panels and EV scooters are much more effective than grand government schemes. Which is why I find it particularly surprising that you think this particular grand government scheme is going to be useful.

 

[LarryClay]

We Westerners tend to have a Western view bias.

 

[nos3000]

One thing left out of that list… word of mouth / personal experience. As more people buy EVs, others they know who haven’t done this get exposed to more EVs, given rides in them etc. This ‘normailises’ EVs and also impacts their perceptions and buying decisions.

Very true. In my experience, when people come to visit, the kids are often interested in going for a ride in my Teslas. The adults not so much. I love the constant badgering from kids to their parents asking if they can get one too! EVs are really something you need to experience first hand.

 

[nos3000]

One thing left out of that list… word of mouth / personal experience. As more people buy EVs, others they know who haven’t done this get exposed to more EVs, given rides in them etc. This ‘normailises’ EVs and also impacts their perceptions and buying decisions.

Totally agree!

 

[nos3000]

Ive been seeing a lot of analysis that the transition from ICE to Electric cars will take on a S-Curve shape, and 5% EV sales is the tipping point to join the S-Curve, but none of those graphs ever have any X axis... like how many years does the S curve take. Does it need consistent subsidies per country etc.

So I decided to pull a few country data in different markets with different EV stimulus's to see if there is any alignment of the S-curve, and what can we expect in Australia, since we ticked over 5% this year (now over 8%).

I chose these countries:
Norway - The leader which is already at 83%, and will show if there really is an S shape.
Iceland - The next biggest penetration of EV cars for new sales, although last year there was a slowing of growth.
France - A typical European country.
China - The big player in Asia.
and little old Australia.

Here it is. Each country has their own year they hit 5%, and so I have lined up that transition point to be the same year (year 10 as shown below).

View attachment 1020690

Conclusions:
It really is an S curve.
Every country is following Norway's lead pretty accurately.
Norway is planning to stop selling ICE cars in 2025 (year 21 in this graph) which is 11 years after they had the 5% transition of sales.
This means that its very likely Australia will also stop selling ICE cars in 11 years which is 2034.
Policy variation between countries doesnt make much difference

Would be great to see New Zealand plotted on this curve. Big changes here with removal of rebates and road user charges coming in soon for EVs.

 

[Solar Windman]

Thanks for your interesting data. In America, its a real war. There are constant stories for and against EV's on my web browser home page. The unions are scared of losing high paying jobs, so Biden and democrats must bow to their wishes for re-election hopes. Misinformation and outright lies being funded by the petrochemical industry. Articles like, "No one wants an electric car" despite the obvious opposite in reality, but many Americans don't believe in science or [objective] reality. They want to make their own reality. Good to see data on what is happening globally.