$NIO Inc (NIO.US)$ Rapid growth in EVs means global oil dema...

Rapid growth in EVs means global oil demand for cars has peaked and will be in freefall by 2030, and the end of the internal combustion engine (ICE) era has begun, a report yesterday by the Rocky Mountain Institute (RMI), a US-based nonprofit organization, said.

There is a clear exponential growth pattern for EVs, as rising sales track along an S-curve, the report said.

"By 2030, EVs will dominate global car sales. If we continue to solve the challenges and sales continue up the S-curves, then EVs will make up between 62-86% of global car sales by 2030, with China enjoying an EV market share of at least 90%," the report reads.

Meanwhile, consensus sales forecasts are lagging and get upgraded every year, RMI added.

Led by Northern Europe and China and driven by policy, it took about six years for EVs to rise from 1% to 10 % of new car sales.

The next stage is even faster, with another six years needed to reach 80% in the leading countries, the report said.

Because battery costs enjoy learning curves, total cost of ownership price parity has been reached, and sticker price parity will be reached in every major car market and segment by the end of the decade, RMI said, adding that this will allow the revolution to expand into the southern hemisphere and reach into other transportation sectors.

The rapid growth of EVs means that peak oil demand for cars has passed.

Global oil demand for cars peaked in 2019 and is now at a typical plateau, squeezed by efficiency gains and EV growth, the report said.

By 2030, oil demand for cars will be declining at a rate of more than 1 million bpd every year, with endgame for one-quarter of global oil demand in sight, RMI said.

Rapid growth in automotive battery production is triggering lower costs and higher energy densities that are driving changes in other transportation sectors, from two-wheelers in the Southern Hemisphere to heavy trucks in China and the US, the report said.

The IEA expects Chinese gasoline demand to peak at about 3.7 million bpd in 2024, bringing forward previous forecasts that demand would level off by 2025/2026, according to a Reuters report in Jul.

Peak production is expected to reach 3.7 million bpd, but as early as the first quarter of 2024, compared with previous forecasts of 2024-2025, said Mukesh Sahdev, senior vice president and head of downstream/oil trading at Rystad Energy, according to the report.

China is the world's largest EV market, seeing retail sales of 4.44 million new energy vehicles (NEVs) in January-August, up 36.0% year-on-year, according to the China Passenger Car Association (CPCA).

NEVs contributed 33.6% of China's 13.2 million retail sales of all passenger vehicles in January-August.

In January-August, China's retail sales of battery electric vehicles (BEVs) amounted to 3.0 million units and plug-in hybrids (PHEVs) to 1.44 million units, contributing 22.7% and 10.9% of all passenger vehicle retail sales, respectively.