There are growing signs that global auto sales will continue their comeback from the pandemic, chip shortage and other supply chain snarls. As the recovery takes shape, it’s becoming clearer that sales of internal combustion vehicles are unlikely to ever return to pre-pandemic levels.
Calling peaks is generally a no-win endeavor. The call will either be correct but seem obvious after the fact, or wrong and cause for years of mockery. But with 2022 data now available, BNEF is confident the global market for internal combustion vehicles peaked in 2017 and is now in structural decline.
This may seem self-evident to those watching the market closely, but is likely still jarring for others. Forecasts for oil demand issued just a few years ago still assumed steady growth in sales of these vehicles well into the 2030s.
At the 2017 peak, 86 million internal combustion passenger vehicles were sold, including traditional hybrids like the Toyota Prius. Battery-electric and plug-in hybrid models were a tiny sliver of the market that year, accounting for just over 1 million vehicles combined.
The picture was quite different in 2022. Combustion vehicle sales were down almost 20% from the peak, to 69 million, and plug-in vehicles jumped to 10.4 million.
More: Carmakers Can Kiss Pre-Pandemic Combustion Car Sales Goodbye