Global sales of electric cars are heading for another record-breaking year, according to a new report from BloombergNEF (BNEF).

The Electric Vehicle Outlook 2026 expects over 23m passenger electric vehicles to be sold globally this year; up 11% YoY

The 2026 edition of the annual Electric Vehicle Outlook (EVO) says that EVs – including pure electric models and plug-in hybrids – are set to account for over a quarter (27%) of cars sold globally in 2026, up from 9% five years ago – and over half (52%) of all passenger vehicles are expected to be electric by 2035.

The report (see executive summary here) also finds that falling lithium-ion battery prices are continuing to support global EV adoption, but warns that matching China’s battery manufacturing costs remains a major challenge for most markets.

China continues to account for the largest share of the global EV market, both in terms of market share of global EV sales and its domestic EV sales which now make up almost two thirds (64%) of total domestic car sales.

Focus is also turning to emerging EV markets where the demand for EVs is surging and where EV adoption now often exceeds that of the US. Nearly half of all cars sold in Singapore in 2025 were electric, followed by Vietnam at 39% and Thailand at 27%. In just one year, passenger EV sales in Turkey more than doubled, with 22% of all cars sold in the country being electric. This growth is primarily driven by a push for independence from oil imports, relative openness to Chinese automakers, as well as EV-centric industrial policies, are behind this growth.

In Singapore and Thailand, EV models from Chinese brands have driven adoption, with Chinese brands making up 88% of all EVs sold in Thailand in 2025. Similar – or higher – EV penetration rates without Chinese automakers are possible. Vietnam, for instance, saw EV sales almost double to 179,000 units in 2025, with domestic automaker VinFast accounting for 98% of the total. Similarly, in Turkey, domestic manufacturer Togg was the market’s second-largest EV brand in 2025, after BYD.

This growing proliferation of EVs in road transport has a deep impact on the trajectory for global oil consumption, with total road fuel demand expected to peak in 2029. Under the Economic Transition Scenario (ETS), the combined impact of fleet electrification and fuel efficiency improvements avoids 25.8m b/d of road fuel demand by 2040, four times larger than the oil displacement across aviation, marine and petrochemicals sectors combined.

But despite the positive global sales picture, BNEF has reduced its long- and short-term passenger EV adoption outlook for the second year in a row. The downgraded outlook is largely due to a slowdown in sales in two major markets: China and the US.

In China, tightening of the eligibility requirements behind EV incentives and the increasingly competitive and mature EV market are the key drivers behind the slowdown.

In the US, where sales are set to fall 19% this year, it has been the full withdrawal of federal regulatory support for electrification, including the rollback of national fuel-economy targets and the scale back of the Inflation Reduction Act. The significant slowdown in US EV sales means only 24% of the country’s fleet is electric by 2040.

What is more, affordability remains a key factor in the rate of EV adoption globally. In the major European markets of Germany, Italy and the UK, battery electric vehicles (BEVs) are still 17% more expensive than competing ICE cars. That said, the BEV price premium over ICE dropped from the average 34% in 2024.

Batteries remain the main cost component of EVs and in many markets remain too expensive for BEVs to match combustion cars on price. While the push for battery supply chain localisation is accelerating globally, matching China’s battery manufacturing costs remains a challenge. China continues to benefit from a mature manufacturing supply chain, lower input costs, favorable financing conditions and intense competition, resulting in the world’s lowest EV battery prices. Differences in manufacturing scale and supply-chain integration with regions such as North America and Europe mean higher prices are likely to persist.

Aleksandra O’Donovan, head of electric vehicles at BloombergNEF, said the pace of the EV transition is becoming increasingly uneven across markets, driven largely by policy changes in the US and a maturing market in China.

She added: “In spite of the unevenness, it is encouraging to see that the longer-term trend towards electrification remains intact, driven by improving vehicle economics, falling battery costs and rapid adoption across emerging markets.”

Despite rapid increase in EV sales, the number of electric passenger vehicles on the road won’t outnumber ICE vehicles until 2047. Across all vehicle segments there are still over one billion tailpipe-emitting passenger cars on the road by 2040, while over 80%, 52%, 48% and 42% of the total fleets of trucks, vans, two-wheelers and buses, respectively, are still combustion engine vehicles by then.

Andrew Grant, head of intelligent mobility at BloombergNEF, said: “Slow fleet replacement rates in many markets mean that there are still a lot of combustion vehicles on the global road in the long-term, creating a headache for policymakers aiming for net-zero transport. That said, even meeting the demands of the electric vehicles that our outlook sees on the road creates plentiful opportunities, including roughly $2.2trn in spending per year on vehicles alone by 2035, and another $524bn in investment in the required charging infrastructure between now and 2035.”

Other key findings from the Electric Vehicle Outlook 2026 include:

• EV electricity demand is set to grow significantly as adoption rises. The EV fleet consumed 367 terawatt-hours in 2025, rising to over 2,700TWh by 2040. The grid will require over $800bn of investment globally to incorporate electric vehicles by 2040.
• A surge in demand for stationary storage is reshaping the battery industry and attracting automakers like General Motors, Ford and Volkswagen. Between 2025 and 2035, the stationary storage battery demand outlook increases by 27% compared to last year’s view.
• City buses continue to lead electrification across all vehicle segments, with over half of total municipal bus sales already electric in more than 20 countries in 2025. In 2030, sales are expected to reach 60% of the total.
• Electric van sales reach more than one third (34%) of global sales in the segment by 2030, whilst medium- and heavy-duty electric trucks lag behind, reaching about 17% of global sales in 2030.
• Shared autonomous vehicles, or ‘robotaxis’, remain in the early stages of commercialisation, but are traveling far greater distances per vehicle than human-driven shared vehicles. Waymo’s vehicles, operating in the US, reached a run-rate of nearly 110,000km per year in December 2025.

The executive summary of Bloomberg NEF’s Electric Vehicle Outlook 2026 is online here. BloombergNEF clients can find the full report and full data viewer on bnef.com and the Bloomberg terminal.