Energy volatility could fast-track global EV adoption to 50% above base case, Wood Mackenzie finds

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Postmedia has not reviewed the content. by GlobeNewswire Energy volatility could fast-track global EV adoption to 50% above base case, Wood Mackenzie findsAuthor of the article: You can save this article by registering for free here. Or sign-in if you have an account.China leads with 29.9M in annual sales by 2040, US must make bolder bets on EV technology to keep paceTHIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountLONDON/HOUSTON/SINGAPORE, Aug. 13, 2026 (GLOBE NEWSWIRE) — INSIGHT FOR IMMEDIATE RELEASEWood Mackenzie | www.woodmac.comLONDON/HOUSTON/SINGAPORE, 13 August 2026 – As the Middle East conflict continues to drive volatility in global oil markets, Wood Mackenzie’s base case already projects EVs jumping from 4% of the global fleet today to 25% by 2040.But the firm’s latest Horizons report identifies three factors that could jolt EV sales even higher: governments boost EV supply chain investment to strengthen resilience to oil market shocks, high fuel prices prompt more consumers to switch to EVs and EV technologies advance faster than expected.“If these forces converge all at once, the effect on EV adoption could be dramatic,” said David Brown, Director, Energy Transition Research at Wood Mackenzie. “Our electric shock scenario models what happens when policy, consumer behaviour and technology all move in the same direction, quantifying the implications for commodities and power markets.”Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againAccording to the Horizons report, “Electric Shock: How electric vehicles could hit the accelerator”, this “electric shock” scenario could see global oil demand fall to 99 million barrels per day (mb/d) by 2040, 5 mb/d below the base case and roughly its current level, potentially leading to the early closure of around 40 oil refineries worldwide.China is the global leader in EVs, reaching 42% of Chinese car sales in Q2 2026, up from 33% just a year earlier. The electric shock scenario would accelerate that momentum further. Additional Chinese policy measures including new restrictions on gasoline consumption, full purchase tax exemptions and larger purchase credits could cut the total cost of ownership for EVs by about 30%, pushing annual sales from 8.9 million in 2025 to 29.9 million by 2040. Chinese EV manufacturing capacity could grow by 50% by 2035, with cost advantages enabling aggressive expansion across the Global South.The US: at risk of falling behindThe contrast with the United States is stark. Without advanced battery technologies and competitive supply chains, the US auto sector risks ceding its home market to international competitors and falling behind internationally. US passenger EV sales in the first five months of 2026 were down 33% from the same period of 2025 following the withdrawal of tax incentives, and EVs currently make up just 3% of the vehicle fleet.Under the electric shock scenario and facing a growing wave of EVs globally, US policy responds decisively with targeted policy support that could attract foreign direct investment into EV supply chains and new greenfield plants deploying modular technologies. These measures could bring EV total cost of ownership parity with gasoline vehicles forward to 2031, two years ahead of the base case, leaving the US EV fleet 51% larger than the base case by 2040.Europe enters this scenario with strong decarbonisation ambitions but significant headwinds, some 60,000 auto sector layoffs were announced in 2026 alone. The electric shock scenario assumes a “grand bargain” for Europe: trading tariff relief for Chinese investment in local manufacturing, protecting jobs while accelerating the EV transition. The result could be a European EV fleet 53% larger than the base case by 2040.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The investment challenge: minerals and infrastructureWood Mackenzie estimates that an additional US$45 billion in greenfield metals supply over the next decade would be sufficient to support the accelerated EV growth projected under the scenario.Copper is the most critical bottleneck. Annual mine capacity additions would need to rise from around 850,000 tonnes per year, the long-term average, to approximately 960,000 tonnes per year through 2040, requiring roughly US$25 billion of that additional investment.Much of that capital would need to flow into higher-risk jurisdictions including Argentina, the Democratic Republic of Congo and Pakistan. If established mining regions such as Chile, Peru and the US fail to streamline permitting and maintain competitive fiscal terms, a larger share of future growth will shift toward state-backed Chinese entities, deepening Western supply chain exposure.Charging infrastructure presents a parallel challenge, but one that can be managedTo accommodate higher power demand from EVs, countries will need to expand managed charging: programmes that shift charging to times when the grid has ample supply and costs are lowest.If electricity suppliers and regulators can shift EV charging to periods of ample power supply, grids can be kept stable and charging costs competitive even as power demand from EVs rises.In western Europe, 50% of EV charging is already managed in this way. Under the electric shock scenario, that proportion rises to 85% across Europe by 2040. The US, where managed charging currently accounts for just 5% of sessions, would need to follow suit to keep pace with accelerating EV adoption.The world’s 7 million public charging ports currently sit at just 15% utilisation, but the electric shock scenario would consume that slack quickly. China would require an additional 4 million ports by 2040, representing roughly US$200 billion in incremental investment. Europe would need an extra US$108 billion to build 2.7 million additional ports above the base case.“Geopolitics, consumer behaviour and technological innovation could converge to lift EV sales faster than in our base case,” said Brown. “For OECD countries, securing critical mineral supplies and technological know-how over time will deliver lasting strategic advantage. Battery supply chains could be particularly important in light of the surge in demand for energy storage resulting from the global artificial intelligence (AI) boom.”For further information please contact Wood Mackenzie’s media relations team:Mark Thomton+1 630 881 6885 Mark.thomton@woodmac.comHla Myat Mon+65 8533 8860 hla.myatmon@woodmac.com Chris Boba+44 7408 841129Chris.Boba@woodmac.com You have received this news release from Wood Mackenzie because of the details we hold about you. If the information we have is incorrect you can either provide your updated preferences by contacting our media relations team. If you do not wish to receive this type of email in the future, please reply with ‘unsubscribe’ in the subject header. Wood Mackenzie is the global leader in analytics, insights and proprietary data across the entire energy and natural resources landscape. For over 50 years our work has guided the decisions of the world’s most influential energy producers, utilities companies, financial institutions and governments. Now, with the world’s energy system more complex and interconnected than ever before, sector-specific views are no longer enough. That’s why we’ve redefined what’s possible with Intelligence Connected: the fusion of our unparalleled proprietary data with the sharpest analytical minds, all supercharged by Synoptic AI, to deliver a clear, interconnected view of the entire value chain. Our trusted team of 2,700 experts across 30 countries breaks siloes and connects industries, markets and regions across the globe to empower our customers to identify risk sooner, spot opportunity faster and make every decision with complete confidence.For more information, visit www.woodmac.comMark Thomton Wood Mackenzie 6308816885 mark.thomton@woodmac.com Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.