S&P Global Mobility Projects 15.1M Global BEV Sales in 2025, Up by 29.9% Compared to 2024

Consumer uncertainty around electrification, especially in Europe and the U.S., continues to shape the automotive industry’s approach to electric vehicles (EVs). As 2024 comes to an end, many original equipment manufacturers (OEMs) have scaled back ambitious electrification plans for the next five to 15 years. This is largely driven by concerns about how natural EV demand will evolve as governments adjust policies related to incentives, subsidies, tariffs, and industrial support for the sector.

Outside of China, automakers are facing two primary challenges in their electrification transition: first, scaling up the production of battery electric vehicles (BEVs) that are attractive to customers, and second, securing willing buyers for these vehicles. While the market for BEVs is still growing, it remains uncertain as automakers navigate shifting policy landscapes and market demand. Nearly all automakers underestimated how quickly EV sales would grow in China, now over 50%. That growth allowed China to take over the global EV industry, and the global auto industry, so now all others are struggling to catch up.

Despite these challenges, electric vehicles remain a key growth sector for the automotive industry. According to S&P Global Mobility, global sales of battery electric passenger vehicles are projected to reach 15.1 million units in 2025, marking a 29.9% increase compared to 2024 levels. This will account for approximately 16.7% of the global light vehicle market, up from an estimated 13.2% market share in 2024, when about 11.6 million BEVs are expected to be sold globally.

While the largest share of BEV sales is expected to come from major markets like Europe, the U.S., and China, smaller markets will also see modest growth in EV adoption. The forecasted share of BEVs by region is expected to reflect these trends, with some regions showing strong increases in EV market penetration while others experience slower adoption rates.

American BEV Market Will Grow Despite Federal Funding Cutbacks

S&P Global Mobility projects the 2025 BEV share estimates for the US to be 11.2 %, a YOY Change (2025 v. 2024) of +36.0 %. EVinfo.net projects these gains to come mostly in the second half of 2025, if the incoming administration follows through on threats to cut the US federal EV tax credit soon after taking office. America’s automotive OEMs are less able every passing year to compete globally with China’s low vehicle prices, due to the country’s low production costs. America must subsidize its automotive industry to survive and compete, which is the reason EVinfo.net supports saving the federal EV tax credit. Cutting the credit will cost many automotive jobs and create great economic harm.

S&P Global Mobility Forecasts 89.6M Auto Sales Worldwide in 2025

Global new light vehicle sales in 2025 are projected to rise by 1.7% year-over-year, reaching 89.6 million units, according to the forecast by S&P Global Mobility. This growth reflects a cautious recovery for the global automotive market, as manufacturers continue to manage production and inventory levels based on regional demand patterns, which include slower growth in key markets. Some of this slowdown is attributed to slower adoption rates of electric vehicles (EVs).

The 2025 forecast incorporates several factors influencing the auto sector, including improved supply chains, tariff impacts, high interest rates, challenges with affordability, and elevated new vehicle prices. Additionally, uneven consumer confidence, concerns over energy prices and supply, and risks in auto lending continue to affect the market. Moreover, the transition to electrification remains a challenge, with automakers and consumers navigating a complex landscape.

In the U.S., S&P Global Mobility anticipates that president-elect Donald Trump will prioritize policies impacting the automotive sector in 2025, including potential universal tariffs, deregulation, and shifts in support for battery electric vehicles (BEVs).

Looking ahead to 2024’s final tally, global light vehicle sales are expected to reach 88.2 million units, marking a 1.7% increase from 2023. This growth is largely supported by ongoing inventory restocking as supply chains stabilize after disruptions in recent years.

Europe and the US

As 2024 wraps up, the Western and Central European market is expected to deliver just under 15.0 million units, marking a modest 1.1% year-over-year growth. Consumers in the region remain cautious, and OEMs (original equipment manufacturers) are continuing to refine their vehicle propulsion strategies, including the balance between internal combustion engines and electric vehicles (EVs).

Looking ahead to 2025, S&P Global Mobility forecasts a flatlining market, with sales expected to hover around 15 million units, reflecting a 0.1% year-over-year increase. This subdued growth is attributed to a combination of factors, including economic recession risks, still-high car prices, tapering EV subsidies, EV tariffs, and political uncertainty in key markets like Germany and France. Key challenges identified for 2025 include the evolving electrification landscape, EU tariffs on mainland Chinese imports, the potential risks of Trump tariffs, hesitant consumer demand, the arrival of a new EU Commission, and strong lobbying related to EU emission targets.

For the U.S. market, S&P Global Mobility projects 16.2 million units in new vehicle sales in 2025, reflecting a 1.2% increase from the expected 16.0 million units in 2024. This growth, though positive, occurs in a still uncertain environment, with various challenges affecting overall auto sales, such as high vehicle prices, interest rates, and concerns over the broader economic outlook.

“2025 brings with it mixed opportunities and uncertainty for the auto industry as a new administration and policy proposals take hold,” said Chris Hopson, manager of North American light vehicle sales forecasting for S&P Global Mobility. “New vehicle affordability issues that coalesced to constrain auto demand levels for much of 2024 will not be resolved quickly in 2025. Vehicle pricing levels are expected to decline but remain high; interest rates are expected to shift further downwards, but inflation levels are anticipated to remain sticky, and new vehicle inventory should also progress, but careful management is expected too. Combined with an uneasy consumer, we project this translates to mild growth prospects for auto sales.”

China and Japan

For the year ending 2024, Mainland China is projected to recover to at least 25.8 million units, reflecting a 1.4% year-over-year increase. This recovery is largely driven by the CNY130 billion extension of New Energy Vehicle (NEV) incentives and the new CNY75 billion trade-in scheme. Moving into 2025, despite a backdrop of below-par economic activity, the automotive sector will continue to benefit from these NEV and trade-in schemes, local government auto incentives, broader government stimulus measures, and the continuation of vehicle price wars. S&P Global Mobility forecasts that 2025 demand will rise to 26.6 million units, an increase of 3.0% compared to 2024.

The NEV boom is expected to persist into 2025, with electrified vehicle prices benefiting from reduced battery costs and generous national and regional subsidy programs. Additionally, the full NEV tax exemption through the end of 2025 will help further stimulate demand. As a result, NEV penetration (as a percentage of passenger vehicles) is expected to increase significantly, reaching 58% in 2025, up from 49% in 2024, according to S&P Global Mobility estimates.

Looking ahead to 2025, Japan’s light vehicle demand is expected to return to growth after a disappointing 2024, which was impacted by Daihatsu’s unexpected halt in shipments due to emissions irregularities. S&P Global Mobility projects that sales volumes will reach 4.6 million units in 2025, marking a 5.4% increase from the estimated 4.4 million units in 2024. However, Japan’s status as a key net exporter of automobiles, particularly to North America, presents potential challenges, especially with the threat of US universal tariffs and weaker global economic conditions. While these risks could affect Japan’s export-driven automotive sector, slower growth of BEV adoption in the U.S. might offer some relief, providing opportunities for Japanese automakers to adjust to market dynamics.

Global Light Vehicle Production Outlook

2024: Global light vehicle production is expected to finish at 89.1 million units, reflecting a 1.6% decline compared to 2023. All regions, except for Mainland China and South America, are projected to experience a decrease in production.

2025: The global production outlook for 2025 is dominated by the assumption of a new tariff regime introduced by the incoming U.S. administration. Under this regime, a 10% tariff will be levied on all goods entering the U.S., excluding those from Canada and Mexico (under the USMCA agreement) and Mainland China, where a 30% tariff is assumed. As a result, S&P Global Mobility forecasts global light vehicle production to decrease by 0.4% in 2025, reaching 88.7 million units. The effects of these tariffs are challenging to isolate across regions, as they will compound with ongoing inventory management issues and volatility in vehicle program adjustments by OEMs (original equipment manufacturers).

Mark Fulthorpe, Executive Director of Global Light Vehicle Forecasting at S&P Global Mobility, noted, “The auto industry continues to navigate uncertain terrain as we enter 2025, particularly with the incoming universal tariffs from President-elect Trump. The production landscape will shift dramatically as global trade slows, and retaliatory measures are likely to emerge.”

Regional Production Forecasts for 2025

Production in Mainland China is expected to remain relatively stable, with a 0.1% increase, reaching 29.6 million units. This stability will be supported by strong NEV domestic demand and robust exports, though production may be tempered by EU import tariffs on Chinese-made battery electric vehicles (BEVs).

In North America, overall production in 2025 is forecasted to decline by 2.4%, reaching 15.1 million units. The incoming Trump administration’s policies are expected to influence demand and alter assumptions regarding the vehicle mix. While there are risks, the deregulation anticipated later in President Trump’s second term may provide some positive momentum for the industry.

European production is expected to decline by 2.6% in 2025, with an output of 16.6 million units, down from an estimated 17.0 million in 2024. This decrease is influenced by fine-tuning of propulsion mixes ahead of the 2025 changes in EU emissions rules. Additionally, the incoming tariff and trade assumptions under the Trump administration are expected to impact production, with premium vehicles particularly at risk.

Overall, the automotive industry faces a challenging environment in 2025, characterized by political uncertainty, tariff impacts, and shifting demand patterns, all of which will significantly shape global production trends.