BloombergNEF (BNEF) expects 2.6 million electric vehicles to be sold globally in 2019. This will represent around a 40% growth rate, down from the 70% growth rate in 2018. BNEF said that it expects China will continue to lead, with some 1.5 million units—around 57% of the global market.

China’s market is in transition, and the recent annual doubling of sales every year looks unlikely to hold in 2019. We expect subsidies to be cut in February, but with a phase-out period that lasts until the end of 2Q. The ‘New Energy Vehicle’ quota takes effect this year but the requirements for 2019 are relatively modest. Broader macroeconomic factors (higher interest rates and slowing consumer spending) will also impact global sales. In markets like the US and the UK, direct purchase subsidies are already starting to wind down.

—Colin McKerracher, BNEFhead of advanced transport

BNEF expects European EV sales to come in just under 500,000 units, with strong growth in the Nordics and in Germany. Sales in Italy have been slow but should start picking up in 2019, while sales in the UK will likely be flat or declining after the government eliminated support for popular plug-in hybrid models.

BNEF expects North America sales to come in around 425,000 units, up modestly from 405,000. The Tesla Model 3 surge boosted 2H 2018 sales but the momentum will be difficult to maintain unless a lower-cost model can be introduced quickly, BNEF said.

Sales in Japan and South Korea combined should be around 100,000.

The mini-forecast was part of “Transition in Energy, Transport – 10 Predictions for 2019”.