An electric vehicle (EV) is a motorized passenger car that uses only electricity for its operation, which may be supplied by a battery (battery electric vehicles — BEVs), solar panels (solar-powered vehicles — SEVs) or a fuel cell (fuel cell vehicles). Compared to internal combustion engine-powered vehicles, EVs produce no exhaust, are quieter and offer superior energy conversion efficiency. They also typically have a lower carbon footprint from manufacturing to end-of-life than ICE vehicles.
The future of automotive mobility is largely electric. McKinsey estimates EV sales could grow sixfold by 2030, reaching 40 million units annually worldwide.
However, the industry faces challenges, including range anxiety, high prices, and lack of charging infrastructure. From a technical standpoint, reducing battery costs and improving battery energy density are key to broad adoption. In addition, enabling EVs to operate for longer distances will improve their appeal for commuters and fleet operators.
To address these obstacles, manufacturers can adopt a variety of tactics. For example, they can improve the customer journey to help build brand trust and accelerate EV adoption. They can also invest in charging infrastructure, which will increase the number of refueling points and provide more convenience for customers. And they can introduce new business models, such as EV/battery-as-a-service offerings.
Meanwhile, governments around the world are accelerating EV deployments by setting regulatory targets and offering subsidies. These policies will help drive EV sales growth as well as support the transition to a cleaner, greener economy.