The global electric vehicle (EV) market is experiencing a dynamic shift, with some regions surging ahead while others risk falling behind. According to the International Energy Agency (IEA)’s 2025 Global EV Outlook, the United States is projected to lag significantly in EV adoption compared to other major players like China and Europe. This forecast raises concerns about America’s future competitiveness in the burgeoning EV industry.
The IEA projects that plug-in car sales in the U.S. will reach only 20% of the market by 2030. This figure pales in comparison to the IEA’s previous expectations and the anticipated growth in other regions. Last year’s report estimated a much more optimistic 55% for EV and plug-in hybrid (PHEV) sales in the U.S. by the end of the decade. The revised, lower projection reflects recent policy changes and their potential impact on EV adoption rates.
| Region | Projected EV Market Share by 2030 (IEA 2025) | Previous Projection (IEA 2024) |
|---|---|---|
| United States | 20% | 55% |
| China | 80% | 66% |
| Europe | ~60% | N/A |
Several factors contribute to the projected slowdown in US EV adoption. A key issue is the policy shift towards dismantling pro-EV initiatives. The IEA specifically points to the U.S. policy of “eliminating subsidies and other policy measures influencing markets in favour of EVs” as a significant headwind.
Specifically, there are efforts to repeal the $7,500 clean-car tax credit, which is a crucial incentive for making EVs affordable. Additionally, the Department of Transportation and Environmental Protection Agency are expected to ease tailpipe-pollution regulations, reducing the pressure on automakers to transition to cleaner fleets. Furthermore, there’s a movement to challenge California’s ability to set EV sales mandates, which are currently followed by 11 other states and Washington, D.C. Finally, federal funding for building out the nation’s charging infrastructure has been effectively frozen, hindering the expansion of necessary support systems for EV owners.
While the U.S. faces challenges, the global EV market, particularly in China and Europe, is thriving. China has made significant investments in EV infrastructure and industry, leading to rapid sales growth. The IEA projects that EVs and PHEVs will constitute 80% of China’s car sales by 2030. This remarkable growth is attributed to increased vehicle affordability, supportive policies, and government backing for charging station development. The IEA has revised its 2030 EV outlook for China upwards by approximately 14 percentage points, reflecting the country’s strong momentum.
Europe is also expected to outpace the U.S. in EV adoption, with an estimated electric share of sales approaching 60% by 2030. This progress is driven by stringent emissions regulations, government incentives, and growing consumer demand for electric vehicles.
The potential slowdown in US EV adoption has significant implications for the nation’s competitiveness. Peter Slowik, the ICCT’s U.S. passenger vehicles lead, emphasizes that the EV industry is not just about clean cars and emissions reduction but also about economic leadership. If the U.S. fails to maintain a vibrant EV sector, it risks becoming overly reliant on imports from European and Chinese automakers.
A report by the International Council on Clean Transportation (ICCT) highlights the potential consequences of eliminating the Inflation Reduction Act’s (IRA) tax credits for EV buyers and manufacturers. The report projects that such a move could reduce plug-in car sales by 1.1 million units in 2030 and cost the U.S. 130,000 jobs across the vehicle manufacturing, battery, and charging industries. Despite these challenges, the ICCT anticipates that U.S. electric car sales will continue to grow, driven by declining vehicle costs and technological advancements, even without incentives.
