Navigant: US to remain largest national plug-in vehicle market over next 10 years; Tokyo to take metro market lead spot from LA

Navigant Research forecasts that the United States will remain the largest national market for light-duty plug-in electric vehicles (PEVs) during the next 10 years, with LD PEV sales exceeding 514,000 in 2023. Currently, North America is the strongest market for light duty PEVs with nearly 100,000 sold in 2013, according to the market research firm. Japan is a distant second, with just under 30,000 sales, followed by the Netherlands (more than 23,000) and China (more than 17,000).

Navigant Research forecasts that the global LD PEV market will grow at a compound annual growth rate (CAGR) of 24.6% while the global market for LD vehicles will grow at a CAGR of only 2.6% during that period. Navigant Research estimates the US PEV market will grow at a compound annual growth rate (CAGR) of 16.3% between 2014 and 2023. Canada, which is about 1 year behind the United States in terms of vehicle availability, is expected to have a CAGR of 25.4%, reaching more than 66,000 vehicles in 2023.

Navigant expects that Los Angeles, Tokyo, and Paris will be the top cities in all regions examined over the forecast period. The Los Angeles metropolitan area is currently the largest PEV market by unit, with more than 15,000 PEV sales expected in 2014. However, of the three cities, Navigant expects it to be the slowest growing, with a CAGR of 10.4% for the 2014-2023 timeframe.

Navigant forecasts Paris to lead Europe throughout the report period, with sales approaching 25,000 in 2023. In comparison, Oslo, Norway, the least populous of the European metropolitan areas examined in the report, is expected to have sales of around 13,500 in 2023. The Greater Tokyo area, with a population of over 35 million, is the largest metropolitan area examined in this report. While currently lagging behind Los Angeles, the city is forecast to become the largest PEV market in 2020, with over 35,000 sales in that year.

Navigant Research forecasts that the PEV parc in Los Angeles will grow from more than 36,000 in 2014 to more than 250,000 by 2023. Tokyo, starting from around 19,500 in 2014, is expected to grow to surpass Los Angeles in 2023, with a PEV parc of around 260,000, representing more than 2.3% of the light-duty vehicle on the road in Tokyo.

Although Paris is estimated to have just over half the amount of PEVs in use that Tokyo and Los Angeles have throughout the forecast period, PEVs are expected to represent 2.5% of the city’s fleet. This figure is relatively low compared to the other European cities of Amsterdam and Oslo. Navigant Research estimates PEVs will account for 7.7% and 10.7% of these cities’ fleets, respectively.

While PEVs currently present a marginal increase in load for utilities, PEV concentration in metropolitan areas will push utilities serving these areas to develop strategies for PEV load mitigation. Utilities in the United States have led the globe in terms of developing demand-side management programs for residential sectors, according to Navigant. Time-of-use (TOU) rates specific to PEVs and aggregation of PEVs for demand response (DR) programs will develop alongside high penetrations of PEVs in select US urban and metropolitan utility service areas.

The new forecast report updates Navigant’s PEV forecasts originally developed for the 2013 edition of Electric Vehicle Geographic Forecasts. Past editions of the report focused on the North American market with detailed geographic breakdowns of PEV sales by US state, metropolitan statistical area (MSA), Canadian province, Canadian city, and selected US utility service area. The new report has been expanded to include forecasts on five select PEV markets in both Europe (London, United Kingdom; Paris, France; Berlin, Germany; Amsterdam, Netherlands; and Oslo, Norway) and Asia Pacific (Tokyo, Japan; Seoul, South Korea; Sydney, Australia; Hong Kong; and Singapore).

The forecast model for each region has been updated using actual sales data from 2013 and considers the difference between fuel costs for conventional vehicles and PEVs, as they vary by region. Additionally, Navigant Research has incorporated forecasts on the number of vehicles that will be in use (vehicle parc) throughout the 2014-2023 forecast period.

To generate these forecasts, Navigant Research used numerous variables to evaluate PEV demand by region, broadly classifying the factors into four categories: population and demographics; PEV attitudes in the US; vehicle and infrastructure availability; and PEV economics.