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Global electric vehicle sales set another record in 2025 but entered a period of moderated expansion during the first six months of 2026, with growth rates declining in major markets even as absolute volumes continued to climb. BloombergNEF’s Electric Vehicle Outlook 2026, issued in June, reported that the firm had lowered both its short-term and long-term passenger EV adoption forecasts for the second year running. The assessment attributed the shift primarily to developments in China and the United States, where incentive adjustments and competitive pressures have tempered demand.
China’s tightening of eligibility requirements for electric vehicle incentives combined with an increasingly saturated domestic market to slow sales growth, BloombergNEF data showed. In the United States, full withdrawal of federal regulatory support, including the rollback of national fuel-economy targets and scaled-back provisions from the Inflation Reduction Act, produced a projected 19 percent decline in sales for the full year. Those policy changes followed the termination of tax credits for new and used electric cars after September 2025, according to the report.
The International Energy Agency’s Global EV Outlook 2026 placed worldwide electric car sales for 2025 at more than 20 million units, reflecting 20 percent growth from the prior year. Early indications for 2026, however, pointed to a reduced pace of increase, with the United States registering a 45 percent drop in new electric car sales during the fourth quarter of 2025 compared with the same period a year earlier. The IEA report noted that pre-expiration purchases had lifted volumes in the first three quarters of 2025 by nearly 15 percent before the later decline took hold.
Electric cars accounted for roughly 10 percent of total U.S. light-duty vehicle sales across 2025, a share only marginally below the 2024 figure despite the policy reversal, IEA statistics indicated. In Europe, select national measures such as Turkey’s reduction of the registration tax on battery electric vehicles to 10 percent from 45-80 percent for conventional cars helped sustain uptake, although the overall regional growth trajectory also eased. Turkish domestic production, including models from manufacturer Togg, rose 30 percent in 2025 even as the brand’s market share moderated with new entrants.
Government support for electric car purchases more than doubled year-on-year in several Southeast Asian markets, where import duty reliefs represented nearly half of the roughly 6 billion dollars provided in 2025, according to IEA calculations. The agency projected per-vehicle support levels would fall in 2026 as many tariff exemptions expire or link more closely to domestic production requirements. BloombergNEF similarly observed that the increasingly competitive landscape in China had reduced the effectiveness of earlier subsidy schemes, including a trade-in program that drew 11.5 million applications in 2025 before temporary halts in some cities.
The combined effect of these developments left global electric vehicle penetration on a slower upward path in the first half of 2026 than in preceding periods, even as the market absorbed new models and expanded into additional segments. Both BloombergNEF and the IEA cautioned that sustained policy clarity would prove essential if adoption rates are to regain momentum in the second half of the year and beyond.
