EV adoption accelerated in developing economies riding low-cost models
Electric vehicle (EV) adoption is rising quickly in emerging economies like India, Thailand, and Indonesia, where low-cost models drive demand.
Sales of EVs in China have soared in recent years, representing around a quarter of the world's market. China's Hainan province has set Asia's most ambitious target to phase out sales of traditional vehicles by 2030.
However, unlike solar technology, whose low price makes it an attractive investment, EVs have not impacted the rest of the developing world as much due to comparatively high purchase prices and deficient charging infrastructure.
During COP28, 56 prosperous governments, including the United Kingdom, Sweden, and Germany, made a promise to provide global aid in terms of financial support, supply chain development, and technical expertise to developing markets. The primary objective of this initiative is to make EVs an affordable, accessible, and desirable option in every region by the year 2030.
But even without this foreign assistance, countries in developing Asia like Thailand, Indonesia, and India are determined to build their own EV industries as alternatives to China. EVs are already nine percent of cars sold in Thailand, boosted by a $1.44 billion plant built by Chinese EV giant BYD in the province of Rayong, which will become operational in 2024.
Thailand, Southeast Asia's largest car producer and exporter, has offered incentives including tax breaks and subsidies to attract EV makers and stimulate demand.
Indonesia, which holds the world's largest nickel reserves vital for producing EV batteries, has been determined to leverage these resources to build a domestic EV supply chain. It has aggressively courted foreign car and battery makers through relaxed investment rules.
In India, the number of electric vehicle (EV) owners has surged to millions, primarily consisting of motorbikes, scooters and rickshaws, which account for over 90 percent of all EVs on the road. This growth is attributed to the government-backed scheme that provides a subsidy of $1.3 billion to promote EV manufacturing and offer discounts to customers.