London — Global sales of passenger car electric vehicles (EVs) jumped by 63% last year to top 2 million units for the first time, helped by surging sales of plug-in EVs in the US, according to data provided by EV-Volumes.

A total of 2.08 million plug-in EVs were delivered to customers in 2018, or 2.2% of total car sales, EV-volumes data shows. Of the total, 1.45 million were pure electric EVs and the rest were plug-in hybrid models, it said.

While China continued to dominate the outright number of EV sales last year, in the US Tesla's new Model-3 became the world's best-selling EV of all time, boosting total US EV sales by 81% year-on-year, the data shows.

China remains the engine of growth for passenger EVs, and thus the location of most displaced oil demand. EV sales in China rose 76% on the year in 2018, to make up just over half of global EV total, with 1.17 million vehicles sold.

In November, the International Energy Agency raised its estimate for the number of electric cars on the roads in 2040, predicting that the expected 300 million EVs on the roads globally in 2040 will displace 3.3 million b/d of oil demand growth.

S&P Global Platts Analytics forecasts that plug-in EVs, including plug-in hybrids, will account for nearly half of global auto sales by 2040, displacing some oil demand as a transport fuel and expanding the role of the electricity sector.

NORWAY LEADING EV CHARGE

Despite surging EV sales, the combined market share of plug-in EVs still remains a fraction of the global passenger vehicle market, the EV-Volumes figures show.

At the end of 2018, some 5.3 million plug-in EVs were on the road making up just 0.5% of world's total light vehicle fleet, according to EV-Volumes.

Norway continues to enjoy the highest EV penetration level by far with more than 40% of light vehicle sales last year. Iceland, Sweden, and the Netherlands follow with EV sales penetration rates of 17.1%, 7.2% and 5.2% respectively, the data shows. Regionally, plug-in vehicle sales in Europe reached 408,000 units in 2018, 33 % higher than in 2017.

A number of oil market watchers believe the uptake of EV will outpace many of the more established estimates from forecasters such as the IEA.

Bank of America Merrill Lynch believes global oil demand growth will peak by 2030 due largely to the proliferation of EVs. Bloomberg New Energy Finance expects cost parity between EVs and conventional cars could be reached around 2025, spurring sales further.

As a result, the world's switch from internal combustion engines to EVs will displace 7.3 million b/d of transport fuel by 2040, according to BNEF's latest annual outlook.

Critics of bullish EV sales forecast, however, point to their current dependence on government subsidies in a number of key markets, production constraints for key battery minerals such as cobalt and the limitations of transmission and distribution grids to cope with increases in electricity demand.

-- Robert Perkins, robert.perkins@spglobal.com

-- Edited by James Leech, newsdesk@spglobal.com