As the Tesla Model 3 enters production, oil companies revise estimates of EVs on the road upwards to 530 million by 2040

Tesla’s runaway success with the relatively economical Model 3, just entering production, together with major pushes forward into plug-in automobiles from most major manufacturers has oil companies sweating the numbers a bit.

Bloomberg New Energy Finance (BNEF), a researcher, projects oil demand will drop by 8 million barrels by the year 2040.

 

The Tesla Model 3 may do for mainstream buyers what the S did for luxury buyers. Longer range and lower costs resulted in massive pre-orders.

 

Projections from the oil industry have shot upwards dramatically:

  • Bloomberg New Energy Finance projects electric cars will outsell gas or diesel by 2040 and expects 530 million on the road that year.
  • Organization of Petroleum Exporting Countries raised 2040 EV projection to 266 million (from only 46 million previously predicted).
  • International Energy Agency doubled its forecast for EVs to 58 million (from 23 million) by the year 2030.
  • Exxon Mobil estimates 100 million (previously they guessed 65 million) by 2040.

 

Volvo’s plugin electric V60. Volvo plans to go 100% electric in their automotive fleet by the year 2019!

 

Proven technology and economical batteries

The two factors influencing the dramatically increased estimates is the market success of companies like Tesla (and the success of the evolving technology that underpins them) and the decreasing costs of the lithium batteries. With new battery technology, long ranges became a reality.

Automotive Industry projects higher adoption

As high as the oil company projects are, automotive companies are shooting higher, pressured by governments and environmental activists to really make the technology a mainstream choice. With increasing infrastructure installations, and better batteries, the automotive industry is projecting much higher numbers:

  • Automotive companies, combined numbers, project to sell 6 million electric vehicles EACH year by the year 2025, 8 million a year by 2030 — again according to Bloomberg.
  • Volvo AB will go fully electric (no gas options) by 2019

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