Supply Chain Crisis and Economic Recession Concerns Slow Market Expansion
"Tesla Expected to Hold 'No.1 Throne' by 2030, Apple at 4th Place"
[Asia Economy Reporter Jeong Hyunjin] Executives in the global automotive industry forecast that only 40% of new cars sold in 2030 will be electric vehicles (EVs). This is a significant downward revision from last year’s expectation that 7 out of 10 new cars would be electric. Analysts attribute the slower-than-expected market entry of EVs to challenges in the transition to battery-powered vehicles, ongoing concerns about economic recession, and persistent supply chain issues.
Global accounting and consulting firm KPMG released the results of its "Annual Automotive Executive Survey" on the 20th (local time), based on a survey conducted in October this year with 915 global automotive industry executives. The survey included over 200 CEOs and more than 200 C-level executives.
According to the report, the proportion of EVs among new cars sold worldwide in 2030 is projected to be between 10% and 40%. This represents a 30 percentage point decrease compared to last year’s forecast of 20% to 70%. In the United States, the share of EV sales is expected to be only 35% of the new car market, down to half of last year’s estimate of 65%.
Moreover, 76% of respondents indicated that the sharp rise in inflation and high benchmark interest rates are likely to negatively impact the EV business next year. In fact, following interest rate hikes in major countries including the U.S., reduced demand for new cars has been observed in various places as consumers consider installment interest rates.
Gary Silberg, Global Head of KPMG’s Automotive Sector, told CNBC, "While there remains long-term optimism, the most important thing is that there is realism in the short term." He pointed out that supply chain problems and recession concerns are pressuring EV production volumes, making it difficult to increase market share.
CNBC analyzed that the reasons shaking EV optimism include stricter federal government incentive regulations, difficulties in sourcing raw materials used in battery production, and car prices reaching record highs. Laurent de Plas, KPMG’s Lead Partner for the Automotive Sector, stated, "The automotive industry is facing the challenge of high energy prices amid recession fears, which will act as pressure to delay investments aimed at reducing carbon dioxide emissions."
KPMG also noted that the slowdown in the transition to EVs is particularly pronounced in India, Brazil, and Japan. In India, demand for two-wheelers and other vehicles is higher than for cars due to infrastructure shortages. Brazil is focusing more on alternative fuels like ethanol rather than switching to EVs. In Japan, major automakers including Toyota emphasize the importance of hybrid vehicles over pure electric vehicles.
Meanwhile, Tesla, currently the world’s largest EV manufacturer, is expected to remain the leading company in the EV market in 2030. Tesla was also predicted to be number one last year. However, this year, the gap between Tesla and its competitors is expected to narrow significantly. BMW, which was ranked second last year, dropped to third place this year, replaced by Audi.
There is also a forecast that Apple’s market dominance will strengthen. The response that "Apple will lead the EV market in 2030" increased, raising its ranking from ninth last year to fourth this year. Apple has not officially announced any vehicle production, including EVs. However, rumors persist that Apple is preparing the so-called "Apple Car" and is in talks with various companies to discuss and develop autonomous vehicles. More than two-thirds of KPMG survey respondents expect Apple to enter the automotive market and launch its own brand of cars.
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