How global electric car sales defied Covid-19 in 2020

As the Covid-19 pandemic unfolded in early 2020 and lockdowns were implemented in countries around the world, global car sales experienced an unprecedented drop. Despite gradual recovery over the course of the year, early market data suggests that global car sales contracted in 2020 by an estimated 14% year-on-year, mirroring closely the IEA estimate of 15%. The drop in global car sales in 2020 was significantly larger than the one observed during the global financial crisis of 2007-2009.

As the pandemic began to surge in early 2020, there was a general expectation that electric car markets would likely be more resilient than the general automotive sector although a drop in electric car sales was generally expected nonetheless, albeit a smaller one than overall car sales. The IEA estimated a slight increase in global electric car sales despite the pandemic, and suggested that this could be higher if additional stimulus measures were taken.

Global electric car sales by key markets, 2010-2020e


Electric car sales in 2020 exceeded these expectations. Backed by existing policy support and additional stimulus measures, the IEA preliminary estimate is that electric car sales worldwide climbed to over 3 million and reached a market share of over 4%, making 2020 a record-breaking year for electric mobility. This is equivalent to a growth of over 40% in global sales from the 2.1 million electric cars sold in 2019, and marks a return to the two-digit growth rates observed in the period 2010-2018. As a result, there are today more than 10 million electric cars on the road globally. While impressive, the share of electric vehicles in total car sales is still only one-tenth that of conventional SUV sales.

The 2020 story of global electric car sales is a drama with two acts. In the first half of 2020, lockdown measures paralysed manufacturing facilities and supply chains on the one hand, and consumer demand on the other. This was the case in February to March in the People’s Republic of China, and from March to May in European countries and in the United States. The lockdown affected electric car sales, but there were early signs of electric vehicle market resilience for two main reasons. First, policy support was strong – in particular in Europe as 2020 was an important target year for emissions standards. Purchase incentives increased, notably in Germany. Second, continued declines in battery costs, upgraded original equipment manufacturer (OEM) offers in both model choice and performance, fleet operators initiating their technology transition and the enthusiasm of electric car buyers (often affluent households less affected by the economic downturn) provided fertile ground for continued EV uptake.

Over the first half of 2020, global electric car sales were on average 15% lower than over the same period in 2019. The notable exception was Europe where electric car sales were 55% higher on the back of existing policy support schemes.

Global market trends were markedly different in the second half of 2020, when lockdowns were lifted or relaxed for some time, and the automotive market started to recover. For electric cars, monthly sales surpassed those between July and December in 2019 in every month in all large markets including China, the European Union, India, Korea, the United Kingdom and the United States, despite second waves of the pandemic.

The result for the entire year was that electric car sales in Europe more than doubled over 2019 levels: many of its large markets such as France, Italy, Germany and the United Kingdom actually had significantly higher electric car sales than in 2019 throughout almost each month of 2020. In China, electric car sales were 12% higher year-on-year. Both in Europe and China, electric car sales reached about 1.3 million in 2020, which translates into a share of electric cars in total sales of about 10% in 2020 in Europe, and 5% in China. In the United States, despite a lack of EV stimulus measures at the federal level, electric car sales were 4% higher than in 2019 in a car market that shrank by 15%. This suggests that car buyers have a continued attraction to electric cars. In Canada, too, electric car sales dropped less than the overall market. Japan and Australia are the only major markets where electric car sales dropped more than overall car sales in 2020.

Increases and decreases in all car and electric car sales in selected countries and regions, 2020 relative to 2019


Policy support has been a major driver of initial EV deployment, steering both consumer demand on the one hand, and R&D and scale-up efforts from industry on the other hand. Strong policy support was in place in many markets in 2020, primarily in the form of purchase incentives and regulatory instruments. To compensate for the impacts of the Covid-19 crisis, several key countries additionally re-asserted their targeted support to low- and zero-emission vehicles to aid the short-term recovery of the automotive industry.

At the beginning of 2020, the European Union, China and the US state of California already had strong regulatory measures in place, such as tailpipe emissions regulations or EV mandates, with the objective to drive OEMs to diversify their sales away from conventional vehicles and towards electrified powertrains. At the same time, direct electric car purchase subsidies decreased or were terminated in China and at the federal level in the United States over 2019-2020, while significant additional incentives were implemented in markets such as Germany, Italy and Korea. The additional Covid-19 stimulus measures that were implemented from the summer of 2020 by several governments around the world then provided an additional boost. The primary measure was financial incentives to support the purchase of electric vehicles.

Main EV support policies in 2020, and Covid-19 stimulus measures to the automotive sector, in selected countries and regions



Major EV policies in place or implemented from January 2020

Stimulus policies announced as a response to the Covid-19 crisis

European Union

  • CO2 emission standard for cars with corporate average target of 95 g CO2/km for 2020-2021 (plus tighter targets in 2025 and 2030).
  • EUR 750 billion as part of Next Generation EU and recovery plan for Europe, including 37% funds towards climate change mitigation.


  • New energy vehicle (NEV) mandate: 12% credit target (with annual tightening until 2023).
  • NEV subsidy reduction of approximately 50% from 2018 (CNY 16 200-22 500 BEV / CNY 8 500 PHEV.
  • Full NEV subsidy programme phase-out postponed from end of 2020 to end of 2022 (from April 2020, NEV subsidy reduction of 10% from 2019-2020, and an additional 20% reduction in 2021).
  • Relaxation of car permit quotas in a number of cities.

United States

  • Corporate average fuel economy (CAFE) standard of around 38.5 mpg in 2020 (implementation of safer affordable fuel-efficient (SAFE) with lower pace of fuel economy improvement from 2021).*
  • Maximum number of federal purchase tax credits (up to USD 7 500 for BEVs) reached in 2019 for a number of key automakers. Tax credit programme not renewed in 2020.



  • Purchase subsidy EUR 6 000 for cars emitting 2/km.
  • Cash-for-clunker scheme up to EUR 2 500, subject to revenue conditions.
  • Charging infrastructure deployment target of 100 000 publicly accessible chargers by the end of 2022.
  • Maximum BEV purchase subsidy increased to EUR 7 000.
  • New PHEV purchase subsidy of EUR 2 000.
  • Cash-for-clunker scheme increased for first 200 000 vehicles to EUR 5 000 for the purchase of an EV, and to EUR 3 000 for other cars, and revenue conditions relaxed. (June to December 2020; to be continued under tighter conditions in 2021).
  • Charging infrastructure deployment target advanced to end of 2021.


  • (since 2019) Purchase subsidy EUR 4 000-6 000 for cars emitting < 20 g CO2/km / EUR 1 500-2 500 for cars emitting 21‑60 g CO2/km.
  • Additional EUR 2 000 (EUR 4 000 with scrappage) purchase subsidy for cars emitting 2/km.
  • Up to EUR 1 750 (EUR 3 500 with scrappage) purchase subsidy for other cars. (initially August to December 2020, and extended to 2021).


  • (from 2020) Purchase subsidy EUR 6 000 (BEV) / EUR 4 500 (PHEV).
  • Purchase subsidy EUR 9 000 (BEV) / EUR 6 750 (PHEV) (June 2020 to end 2021, and gradual phase-out until 2025).
  • General VAT rate decrease from 19% to 16% (July to December 2020).
  • All petrol stations to provide charging infrastructure.
  • No subsidies to conventional cars in the support package to the automotive sector.

United Kingdom

  • Maximum purchase subsidy GBP 3 500 (BEV and PHEV 2/km and with range conditions).
  • Maximum purchase subsidy GBP 3 000 (BEV and PHEV 2/km and with range conditions).
    (from March 2020, with scheme extended to 2022-2023).


  • Up to USD 7 000 purchase subsidy, subject to revenue conditions
  • USD 1.5 billion towards the purchase of electric or hydrogen vehicles equipment, plus USD 300 million towards infrastructure in proposed 2021 State budget, and all cars to be zero-emission by 2035.

*The new US Administration, immediately following the inauguration in January 2021, announced its intentions to boost policy support for low- and zero-emission vehicles. This may impact the SAFE rule implementation plans. Note: A number of purchase subsidies are subject to maximum vehicle retail price limits. BEV = Battery Electric Vehicle, PHEV = Plug-in Hybrid Electric Vehicle, NEV = New Energy Electric Vehicle (includes BEVs, PHEVs and fuel cell electric vehicles). The modal scope of this table is passenger light-duty vehicles (cars). Sources and further details: IEA Global EV Outlook 2020; IEA article Promoting vehicle efficiency and electrification through stimulus packages, French government, Italian government, Reuters, European Commission, European Commission recovery plan for Europe, UK government, California government, California Office of Governor, California Office of Governor.

As discussed in a previous IEA article, the policy schemes aimed at providing stimulus to the automotive sector in response to the Covid-19 pandemic differ in important ways from some of the reactions to the 2008‑2009 crisis. First, there is a clearer focus on boosting the uptake of electric and hybrid vehicles. Second, a number of countries are adopting a more integrated transport sector approach, by also considering charging infrastructure and providing support to both public transport and non‑motorised mobility options. This sits in the broader context of commitments to clean energy transitions made prior to the Covid-19 crisis, such as the EU Green Deal, and can generally be seen as supporting other commitments announced over the course of 2020 to achieve net-zero emissions by mid-century.

The share of electric cars in global car sales must climb to around 50% by 2030 to be aligned with a pathway to net-zero emissions by 2050. Several countries have announced the full phase-out of internal combustion vehicles over the next 10‑30 years. Due to countries’ commitments to achieve net-zero emissions, and given the way governments in key car markets responded to the Covid-19 crisis by emphasising support for electric vehicles in recovery plans, there are grounds for optimism. Yet, many of these plans were set to cover the remainder of the year 2020. In some cases, a maximum quota was set that was reached in just a few weeks (e.g. France’s enhanced cash-for-clunker scheme). This approach, although effective in providing impetus to the market for electric vehicles, does not constitute a guarantee for persistent sales growth of electric vehicles over time.

The main challenges to be faced in the programmes for 2021 and beyond will be to continue implementing and tightening the broader regulatory instruments (such as the European Union’s CO2 emissions regulation for cars and vans, China’s NEV mandate or California’s zero emission vehicle [ZEV] mandate) and reinforcing the electric vehicle ecosystem (recharging infrastructure and power system integration, sustainable batteries) that will determine long-term deployment of electric vehiles. The near-term efforts must continue to effectively support electric vehicle competitiveness while gradually phasing out purchase subsidies as sales volumes continue to expand. It is also imperative to adapt these approaches to the Covid-19 crisis response so as to stimulate the automotive sector in agreement with long-term transport decarbonisation objectives.

The good news is that, in the second half of 2020, several countries announced extensions of their EV support packages. These range from additional months to several years beyond 2020, albeit for some with tighter access to the subsidies (e.g. tightened vehicle price cap, tightened income conditions, gradual reduction of subsidies and tax reductions) (see table). In the European Union in particular, the CO2 emissions regulation for cars and vans, for which milestone targets are set for 2025 and 2030, should contribute to maintaining the momentum, although the 2021 target remains mostly unchanged from 2020. In 2020, the emissions target will apply to 95% of each manufacturer’s least emitting new cars. From 2021 onward, the average emissions of all newly registered cars of a manufacturer will have to be below the target (95 g CO2/km).1 To accelerate the deployment of sustainable mobility, the European Commission is also in the process of revising the 2025-2030 targets of the CO2 emissions regulation for cars and vans, the Alternative Fuels Infrastructure Directive, the Batteries Directive and the EURO pollutants emissions standard.

The outlook is that sales are likely to grow in Japan and Korea, which are introducing significantly higher EV subsidies than in the past. China will continue navigating the gradual phase-out of its NEV subsidy programme (full phase-out was postponed from 2020 to 2022) and the progressive tightening of its NEV credit attribution system and NEV credit mandate targets. An important indicator of how China will balance stimulus to the entire car market with stimulating the sale of electric cars will be the license plate permit quotas at a city level, which have been temporarily relaxed to stimulate demand. For the momentum in electric car sales in China to continue, favourable access and circulation measures for “new energy vehicles” will need to be rapidly reimplemented in the designated cities.

In the United States, the stimulus measures and longer-term goals adopted by the new administration will be critical guides for electric vehicle markets. But the resilience of electric car sales in 2020, despite the Covid-19 crisis, together with the planned release of new popular electric car models in 2021 and the increased state support for electric cars in spite of a degrading policy support environment at the federal level already fuel optimistic sales forecasts for the next few years. There are also early signals that the new US administration could prioritise fuel economy standards, promote charging station deployment, provide tax credits and help factories making internal combustion engine cars retool to make electric vehicles.

To achieve the long-term goals for clean energy transitions, it is critical that rapid EV deployment growth be sustained throughout the decade. The fact that sales of conventional sport-utility vehicles kept rising in 2020 despite the pandemic clearly signals the need for strong and targeted transport decarbonisation policies. Recovery packages that have a continued focus on electric mobility offer an opportunity to accelerate the pace of transition. As we enter this new decade, policy measures should encompass a broad set of considerations. These include equity (e.g by applying revenue-conditions or vehicle retail price-conditions, or by providing zero-interest loans), environmental performance standards (providing stimulus proportional to the emission reductions that a given car model delivers) and long-term viability with a view to revenue-neutrality (e.g. through differentiated taxation or bonus-malus systems). Regulatory instruments should continue to encourage sustainable and low-emission technology investments (considering all lifecyle stages of the product), while supporting and prioritising industry reskilling towards low-carbon economic activities with high employment multipliers, including non-motorised transport infrastructure and battery manufacturing.

This commentary is based on preliminary data for electric light-duty vehicle sales in 2020. IEA final electric vehicle market data for 2020 will be released in spring 2021, based on submissions by the member governments of the Electric Vehicles Initiative, as part of the Global EV Outlook 2021 publication (The Global EV Outlook 2020 report available here).

This commentary benefited from helpful comments from IEA colleagues Timur Gül, Jacob Teter and Araceli Fernandez Pales.

  1. In 2020, the emissions target will apply to 95% of each manufacturer’s least emitting new cars. From 2021 onward, the average emissions of all newly registered cars of a manufacturer will have to be below the target (95 g CO2/km).