By Eric Sundquist
With slowing growth in light-duty automotive markets overall, and an increasing share of electric vehicles within that market, last year may have been the high point for internal combustion engines.
Such is the conclusion drawn by Financial Times, based on interviews with and reports from a variety of automotive industry experts.
“When you look at 2018 since the summer, new car sales in all of the important markets are going down,” Axel Schmidt, global automotive lead at Accenture, told FT. “Selling combustion engine cars to customers—this will not grow in the future.”
While auto sales may eventually pick up, they are unlikely to grow faster overall than the EV segment, implying a reduction in ICE sales, FT reported.
In the United States, EV sales surged 80 percent over 2017, largely based on the success of the Tesla Model 3. Just over one in 50 light-duty vehicles—or 361,307 of them—sold last year had a plug. (Muddying the water, about a third of those vehicles were hybrids with ICE powertrains or battery-charging range extenders as well as electric motors.)
Similar numbers are not yet available globally, but based on November data, worldwide EV sales were on track for a 40 percent increase over 2017, to a total of 2 million plug-in vehicles. That would put market penetration at a little over 2 percent, as in the U.S.
“‘Peak ICE’—peak internal-combustion-engine car sales globally—may already have occurred with the ending of 2018,” Elmar Kades, global co-leader for automotive at AlixPartners, told FT. “It’s this slowing growth of the overall pie that the industry should be most concerned with, even as it has to grapple with—and pay for—the continuing switchover to electric vehicles.”
Eric Sundquist is Director of SSTI.
By Eric Sundquist