Auto industry executives expect electric vehicles to make up just over half of new car sales in the United States and China by 2030, and could do so without receiving government subsidies, according to a new survey by accountants and analysts. consultancy KPMG.
But internal combustion engine vehicles, including hybrids, are expected to maintain a significant share of most major auto markets in the coming years, according to KPMG’s latest annual survey of 1,000 auto industry executives.
The rate at which automakers can phase out internal combustion engines and the carbon dioxide they emit is a critical issue for the global auto industry. A group of automakers and countries signed a statement earlier this month calling for the phasing out of internal combustion engine vehicles worldwide by 2040 and by 2035 in wealthier countries.
But the world’s two largest automakers, Volkswagen AG and Toyota Motor Corp, and three of the world’s largest auto-buying countries — China, the United States and Germany — have failed to sign up.
KPMG’s survey of automotive executives found that they believe electric vehicles will account for 52% of sales in the United States, China and Japan by 2030, with lower percentages for Western Europe, Brazil and India. But behind those aggregate predictions, industry executives have widely differing views.
For China, some auto industry executives expect electric vehicle sales to be less than 20% of the market by 2030, while others believe the world’s largest market could be 80% electric by then.
Electric vehicle sales around the world have so far been boosted by government subsidies. But 77% of respondents to KPMG’s survey said electric vehicles could be massively used within a decade without government support, as battery costs fall to the same level as petrol engines. However, 91% of auto executives said they support government subsidies.
The comprehensive survey also found that 75% of executives surveyed expect their companies to sell “non-core” assets in the coming years as they re-evaluate which business areas will be viable as more new vehicles switch to battery-electric technology.
“There will be a lot of mergers and acquisitions,” said Gary Silberg, KPMG’s global leader in the automotive practice.
Despite the supply chain disruptions and pandemic of the past year, about 53% of executives surveyed said they are confident the industry can deliver profitable growth in the next five years.
The most optimistic executives were in the United States and China, the most pessimistic in France, the survey found.
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