The momentum for new energy vehicles (NEVs) continues to grow, with global automakers increasingly investing in this sector. Recent reports indicate that UK Prime Minister plans to announce a ban on the sale of gasoline and diesel cars within the next ten years.
UK to Ban Gasoline and Diesel Cars by 2030
According to the Financial Times, the UK government, alongside industry insiders, is set to confirm that from 2030, the sale of new gasoline and diesel cars will be prohibited across the country. Initially, the ban was planned for 2040, then moved to 2035 earlier this year. However, this deadline is now being pushed forward by another five years. Hybrid vehicles will still be allowed until 2035.
This ban signifies a major shift in the UK automotive market. Currently, gasoline and diesel vehicles account for 73.6% of new car sales, while pure electric vehicles represent only 5.5%, with hybrids making up the rest. The higher production costs of NEVs compared to traditional vehicles mean that significant government investment in infrastructure is necessary to persuade most automakers to adopt new technologies.
Automakers have been lobbying the UK government, advocating for a delay in the ban on hybrids, which they believe could serve as an acceptable transitional option for consumers. Honda UK has expressed concerns, stating that a complete phase-out of fuel vehicles within 15 years is too ambitious, given current technological and resource barriers.
Traditional Automakers Shift Focus
The global push for clean energy technologies and advancements in artificial intelligence have made NEVs an inevitable trend. Over the past two years, numerous automakers have announced timelines for phasing out fuel vehicles.
Bentley: The luxury brand under the Volkswagen Group plans to launch its first all-electric vehicle by 2025, transitioning its lineup to solely plug-in hybrids and electric vehicles by 2026, with full electrification by 2030.
Rolls-Royce: Unlike Bentley, Rolls-Royce intends to skip hybrids and introduce an all-electric model within the next decade while continuing to offer internal combustion engine models.
Nissan: The company plans to cease production of gasoline vehicles after 2025, focusing on pure electric and hybrid models. Initially, Nissan aimed to electrify 50% of its offerings by 2023 and introduce at least five all-electric models domestically by 2025.
Volvo: Volvo has announced it will stop selling gasoline vehicles by 2025, with electric and hybrid cars each comprising half of its offerings thereafter.
In China, the State Council has released the “New Energy Vehicle Industry Development Plan (2021-2035),” which sets a target for NEVs to account for about 20% of new car sales by 2025 and aims for significant advancements in core technologies by 2035.
The Booming NEV Market
The market for NEVs in China is rapidly expanding. In addition to dedicated NEV companies like BYD, NIO, and Li Auto, real estate giants like Evergrande and Baoneng are also entering the sector, alongside traditional automakers making significant shifts.
Market Valuation: Currently, Tesla’s market capitalization exceeds that of Toyota, Volkswagen, and Audi combined, while BYD has surpassed Daimler, and NIO’s valuation exceeds General Motors and BMW.
In recent trading, NIO became the top traded stock on US markets, surpassing the combined trading volume of tech giants like Amazon, Apple, and Microsoft. Among the top ten trading volumes, five slots were occupied by Chinese companies, with NIO leading at $27.4 billion, followed by Alibaba, Li Auto, Pinduoduo, and XPeng Motors.
The soaring popularity of NEVs reflects a significant shift in the automotive landscape, highlighting the growing importance of sustainable technology.