The global EV market: where to from here?

Colin McKerracher – Head of Advanced Transport Bloomberg New Energy Finance

@colinmckerrache

July 10, 2017 Analysis to help you understand the future of energy

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1 July 10, 2017 Global EV sales by region 2011-2017e, thousand units YoY growth +69% +40% +56% +55% +47% Thousand units 1,200

We expect passenger EV 1,018 1,000 sales to be just over 1m in 46 2017 800 218 695 21

600 158 283 448 23

400 209 288 32 115 206 29 200 122 27 116 182 435 96 36 283 30 96 56 66 114 0 2012 2013 2014 2015 2016 2017 China Europe US Japan Canada South Korea RoW

Note: Includes highway-capable PHEV and BEV passenger vehicles only; RoW is “Rest of World”

2 July 10, 2017 Countries where EVs were above 1% of total passenger vehicle sales

Bloomberg New Energy Finance, Marklines

3 July 10, 2017 BEV model availability, 2008-20

Jaguar Tesla VW I.D.* Toyota Trumpchi VW I.D. CROZZ Defender RAV4 GS4 I-Pace pickup* Mitsubishi eX BMW i5 Volvo 40.2* SUVs/Trucks Tesla Tesla M-B EQ VW Model Y* Model X Chehejia Audi E-tron Budd-e M-B B-Class BYD e6 NIO ES8* SUV* Quattro E-sport DeZir Qianto Q50 Fetish Tesla Roadster Tesla Model S Sports Tesla Roadster* M-B SLS eDrive Hyundai Ioniq Aston Martin GLM G4 NIO ES9 Audi R8 E-tron Exagon Furtive Mahindra eVerito RapidE Geely Emgrand NIO EVE ChangAn SAIC E-Lavida Tesla Model 3 LeEco LeSEE Eado Mullen 700e Lucid Air Sedans CODA EV Audi E-tron Faraday Honda Clarity BAIC EU260 Sportback JAC iEV4 BYD e5 FF91 Kia Ray Hyundai BMW i3 M-B E-Cell BlueOn VW e-Golf Chevy Bolt VW I.D. Chevy Spark Honda Fit ZE Ford Focus Leaf Nissan Leaf 2* BMW e

Fiat 500e VW Mitsubishi i-MiEV Runabouts e-Up Seat Mii* Mahindra e2o Kandi Panda Smart Bollore ForTwo Bluesummer Ford Transit VW e-Bulli 2008200920102012201320142015201620172018201920202011 BYD T3 Nissan NV200 Tata Smith Edison Small vans IRIS Partner ChangAn EM80 M-B Vito VW I.D. BUZZ

0 50 100 150 200 250 300 350+ Source: Bloomberg New Energy Finance, Images various. Notes: Not exhaustive. (*) Range is speculated. 4 July 10, 2017 Fuel economy regulations for US, China and Europe L/100 km

9.0

8.0

7.0 US 6.0

US: 4.2 5.0 China: 4.9 EU

EU: 4.1 4.0 China 3.0

2.0

1.0 Achieved fuel consumption Future standard

0.0 2000 2005 2010 2015 2020 2025

Note: The fuel economy targets have been normalised to the CAFE testing procedure. US targets are for passenger cars only. Source: EPA, NHTSA, EU, ICCT

5 July 10, 2017 China’s vehicle sales according to the recent 2025 plan

Millions of 35 vehicles sold 30 7 28.0 2 24.6 0.5 23.5 22.0 19.3

27.5 28 28 24.3 22.0 23.4 19.3

2012 2013 2014 2015 2016 2020e 2025e Internal Combustion Engine (ICE) New Energy Vehicle (NEV)

Source: China Automotive Information Net, Bloomberg New Energy Finance

6 July 10, 2017 BNEF 2016 battery pack price survey results, 2010-2016 ($ per kWh) -20% -20% -7% -10% -35% -22%

1000

800

642 599 540

350 273

2010 2011 2012 2013 2014 2015 2016 Notes: This includes cells plus pack prices. For years where there were two surveys, the data in this chart is an average for the year. Source: Bloomberg New Energy Finance

7 July 10, 2017 Short term EV sales forecast

EV % of new sales 5% Europe 4% U.S. 3% China 2% Rest of 1% the World 0% 2015 2016 2017 2018 2019 2020 2021

8 July 10, 2017 Long term EV sales forecast to 2040

million cars per year Rest of 70 Europe France 60 UK 50 40 Germany 30 Japan 20 Rest of World 10 China

0 US 2015 2020 2025 2030 2035 2040

Source: Bloomberg New Energy Finance

9 July 10, 2017 Long term EV sales forecast to 2040

million cars per year 140 ICE sales, 120 total 100 54% 80 43% EV ​ ​ ​ sales, 60 ​ total 24% ​ ​ 40 ​ ​ ​ EV % 20 8% ​ 3% ​ ​ of new 1% ​ ​ 0 ​ ​ ​ ​ ​ ​ sales 2015 2020 2025 2030 2035 2040

Source: Bloomberg New Energy Finance

10 July 10, 2017 Main factors that could derail global EV sales growth

11 July 10, 2017 For EV energy market impacts: think small, not big

CHINA’S LOW SPEED EV MARKET SHANDONG PROVINCE EXAMPLE ● Typically two-seater ● Top speed: 60km/h ● Cost: $3,000-7,000 ● Unsubsidized, unregulated and growing very rapidly ● Template for emerging economies? 700,000

600,000

500,000

400,000

300,000

200,000

100,000

- 2010 2011 2012 2013 2014 2015 2016 Source: Times of , Shandong Motor Vehicle Industrial Bureau, Bloomberg New Energy Finance, Mitsubishi

12 July 10, 2017 This publication is the copyright of Bloomberg New Energy Finance. No portion of this document may be photocopied, reproduced, scanned into an electronic system or transmitted, forwarded or distributed in any way without prior consent of Bloomberg New Energy Finance.

The information contained in this publication is derived from carefully selected sources we believe are reasonable. We do not guarantee its accuracy or completeness and nothing in this document shall be construed to be a representation of such a guarantee. Any opinions expressed reflect the current judgment of the author of the relevant article or features, and does not necessarily reflect the opinion of Bloomberg New Energy Finance, Bloomberg Finance L.P., Bloomberg L.P. or any of their affiliates ("Bloomberg"). The opinions presented are subject to change without notice. Bloomberg accepts no responsibility for any liability arising from use of this document or its contents. Nothing herein shall constitute or be construed as an offering of financial instruments, or as investment advice or recommendations by Bloomberg of an investment strategy or whether or not to "buy," "sell" or "hold" an investment.

13 July 10, 2017