IEA says 1 in 4 cars sold in 2025 will be electric, signalling an EV boom

Electric vehicles are no longer a novelty. According to the International Energy Agency’s ‘Global EV Outlook 2025’, they are about to become mainstream. EVs are projected to account for 25% of global car sales in 2025 — a striking rise from previous years. That is one in every four cars sold worldwide.

 What is fuelling this acceleration? A mix of falling costs, smarter policy, rapid innovation, and a public increasingly ready to ditch the petrol pump.

China is driving the global EV market

China remains the undisputed leader in electric mobility. In 2024, it accounted for over half of all EV sales globally. This dominance is no accident. The Chinese government has heavily backed the industry with favourable policies, subsidies, and infrastructure investment — and the results speak for themselves.

More notably, two-thirds of electric cars sold in China were cheaper than their petrol-powered equivalents. That kind of price competitiveness is turbocharging adoption. Home-grown brands such as BYD and XPeng are producing affordable, tech-rich models that are not only outselling foreign competitors in China but are increasingly making their mark on global markets.

China’s EV rise is not just a national success story — it is reshaping the global auto industry. The country’s push for affordability, production scale, and innovation has created a blueprint others are now trying to follow.

The US is losing momentum

While China surges ahead, the picture in the United States is more complex. Although EV uptake is still increasing, the pace has slowed. The IEA has downgraded its forecast for US EV growth, pointing to weaker federal support, political uncertainty, and the rollback of several climate and transport policies.

Incentives that once helped make EVs more accessible have been scaled back or eliminated altogether. This has left carmakers and consumers navigating a patchwork of policies, making long-term planning difficult. Despite strong efforts from US manufacturers like Tesla and Rivian, without consistent national backing, the country risks falling behind in the global race to electrify transport.

Battery costs are finally falling

One of the most important and underreported stories behind the EV boom is the declining cost of batteries. In 2023, lithium iron phosphate (LFP) batteries accounted for over 40% of global EV battery capacity. LFP batteries are cheaper, more stable, and less reliant on rare minerals than their cobalt-heavy counterparts.

This shift in battery technology is making EVs more affordable across all markets. It’s also opening doors for the electrification of larger vehicle types like SUVs, vans, and trucks — segments that previously struggled with cost and range challenges.

Battery gigafactories are expanding rapidly in Asia, Europe, and North America, driving down prices further. As these developments scale, EVs are expected to achieve price parity, or better, with petrol cars in many countries before 2030.

Charging infrastructure is expanding but it is not enough

As more electric vehicles hit the roads, the pressure to build out charging networks is growing fast. In 2023 alone, the number of public charging points worldwide increased by 40%. That’s significant progress, but not nearly enough.

The IEA estimates that to meet projected EV adoption levels by 2035, the world needs six times more public chargers than it has today. The gap is especially pronounced in rural areas and for drivers who lack access to private home charging.

Governments and private companies are racing to install high-speed chargers along motorways, at shopping centres, and in urban neighbourhoods. But the pace must quicken. Infrastructure could soon become the single biggest barrier to sustained EV growth.

Beyond cars: fleets, buses, and trucks go electric

The electric revolution is not limited to private cars. Public transport systems and commercial fleets are undergoing a similar transformation.

Electric buses are increasingly common in major cities, particularly in Asia and Latin America, where they are reducing air pollution and fuel costs. Delivery companies are also electrifying their fleets, seeing long-term savings and regulatory benefits. And for the first time, battery-powered heavy-duty trucks are becoming commercially viable, thanks to advances in range and charging speed.

The electrification of freight and public transport is essential if the world is to hit its climate targets. Together, these vehicles account for a large share of transport-related emissions — and they are now part of the solution.

Looking ahead: a half-billion EVs by 2035

If current policies stay in place, the IEA forecasts a dramatic rise in EV adoption. By 2030, there could be 245 million electric cars on the road. By 2035, that number could exceed 500 million, with electric cars accounting for more than half of all new light-duty vehicle sales.

The tipping point is not in the distance — it is happening now. As battery prices fall, infrastructure improves, and the economics of EVs grow more compelling, the industry’s momentum becomes harder to reverse.