Electric vehicle market trends around the world

There is no longer any doubt that the automobile industry is shifting to electric vehicles. Every leading
automaker in the world is introducing electric cars. Some manufacturers have gone even further,
announcing dates when they will only construct “electric” cars (batteries and hybrids) and pure electric
vehicles. Some of manufacturer’s like as Lucid, Rivian, Bollinger and Fisker, Tesla are all-electric from
day One. The technology for electric vehicles, batteries, and related accessories and systems is rapidly
evolving, and the global market for electric vehicles is getting higher in response to rising demand and
favorable regulations in many countries.

Electric cars

In 2018 over 2 million electric cars were added to the road globally, bringing the total number of electric
automobiles on the road to over 5 million. According to a new report from BloombergNEF (BNEF), EVs
and other zero-emission vehicles will account for 70% of new-vehicle sales by 2040, even if no new
economic or policy efforts are put forward by global authorities.

While the upfront cost of an electric car is still higher than that of a comparable internal combustion
engine vehicle, this cost is reducing, and BloombergNEF (2020) estimates that by the mid-2020s, EV and
ICE vehicles will be price similar in most segments. The price of Lithium-ion batteries, which are used in
EVs, has decreased, which is one of the key reasons for the fall in EV prices. The price of these batteries
dropped by 86 percent between 2010 and 2019, from USD 1160 per kWh to USD 156 per kWh. Batteries
prices are expected to drop much lower, to USD 87/kWh in 2025 and USD 62/kWh in 2030.
(BloombergNEF, 2020).

Electric buses

Transportation currently accounts for one-third of all greenhouse gas emissions. The Bloomberg report
reports that since 2011, electric vehicles have reduced the growth in oil consumption by more than 3%.
And, 3/4 of the reduction in this consumption comes from electric buses. Among the various types of
EVs, electric buses are expected to take up the largest percentage of the overall fleet. All over the world,
the trend in urban areas is to ban thermal vehicles in favor of low-carbon mobility (electric car-sharing,
bicycles and public transport with zero CO2 emissions, including e-buses). However, the global
implementation of electric buses is taking place at varied rates depending on the country and city. As
public buses normally run on diesel fuel and travel great distances during the day, they pollute the air and
release greenhouse gases. As a result, many governments are pushing the electrification of their bus
fleets.
Electric Two-wheelers

China dominates the global electric two-wheeler market, producing 26 million electric two-wheelers in
2018 and with over 250 million units on the street, contributing for more than a quarter of the global
motorized two-wheeler stock of around 800 million units. There are around 0.9 million electric two-
wheelers in Vietnam, and 0.6 million in India. In China, however, two-thirds of two-wheelers have
limited range (0.5-0.8 kWh batteries providing around 50 km per charge) and low speed (usually 20-25
km per hour). Although this is sufficient for urban traffic, many Nepalese consumers believe it is
insufficient because the country's existing ICE motorcycles and scooters offer greater range and speeds.
However, several models of large and small electric scooters from China and India have recently entered
the Nepalese market, and it is possible that at least some of them may eventually match these market
demands.

Market analysis of vehicles in Nepal

The majority of vehicles sold in Nepal are motorbikes and small cars with engine capacities of less than
1,500 cc and an average of 1,400 cc. Although the average vehicle size has increased significantly in
recent years, with some customers preferring larger SUV-type vehicles, small cars remain dominant the
Nepalese car market. This is mostly due to the fact that it is a price-sensitive market, with the majority of
customers preferring vehicles with lower capital and operating costs. Therefore, EV need to be
competitive in these consumer segments for it to able to claim a significant market share. The number of
electric two-wheelers and cars entering the Nepalese market has increased in recent years, and their prices
are becoming more competitive in the market due to lower custom duty and financing provided by banks.
However, ICE vehicles continue to dominate the market, and most consumers are still unwilling to invest
in electric vehicles.

A few companies have begun out to assemble electric powered two-wheelers in Nepal and one Nepali
start-up, YatriMotorcycles, has additionally designed and constructed a premium electric motorcycle. EV
technology is relatively simple compared to ICE and because the technology is continuous, there is a
possibility to expand local assembly and manufacturing. The Government of Nepal should, therefore,
invest in research and development as well as support local initiatives. As for electric buses, their prices
are still much higher than diesel buses so government subsidies would be required to make them
competitive in the market.
Future EV Projections for Nepal

In Nepal, the number of electric vehicles is growing, and this trend is expected to continue. With the
Indian government also focused on expanding the use of small and public vehicles and with the majority
of the 4,444 vehicles sold in Nepal being from India, there is a strong possibility that various 4,444
models of electric two-wheelers, three-wheelers, trucks light and more buses will be available and
affordable in the Nepalese market in the near future. If Government of Nepal takes advantage of this trend
to drive demand for two-wheelers, small vehicles, and buses through attractive incentives, then the EV
market share in these segments could increase dramatically over the next five years. The Government of
Nepal has already taken the initiative to start purchasing several e-buses, which is a good step. If the
Government of Nepal can come up with a good financing scheme along with operational guidelines this
could significantly boost the demand for electric buses. As the operational cost of e-buses will be
substantially lower than of diesel buses, private operators will likely show interest in e-buses if the initial
cost is affordable. A cost comparison of diesel and electric buses in Nepal, showed that the purchase cost
of an electric bus was 7-13 times higher than that of a similarly sized diesel bus, but if we take into
account lifetime fuel and maintenance costs, as well as environmental and social costs and costs resulting
cheaper, so electric buses are cheaper.