According to IHS Automotive, EV sales are about to take off like a Model S on a freeway onramp. The research firm predicts that worldwide production of plug-ins will soar to more than 403,000 in 2014, a 67% increase.

The Europe, Middle East and Africa region will account for the largest share of production at more than 40%, with the Americas and Asia-Pacific each making up about 30%.

“European emissions standards are tightening in the second half of this year with the implementation of the European Commission’s Euro 6 legislation,” said IHS analyst Ben Scott. “At the same time, European automakers are introducing compelling new EV models, such as the BMW i3. These factors will boost EV demand and manufacturing in Europe in 2014.”

IHS also made the following predictions for the electrifying year ahead:

• More product availability and greater choice will boost adoption of EVs, as the BMW i3, Volkswagen e-Up!, Mercedes-Benz B-Class Electric and Audi A3 e-tron PHEV join the lineup.
• The global number of EV charging stations will pass 1.1 million units by the end of this year. “Although most of the installed base is for domestic charging, almost 35,000 charging stations are expected to be installed this year in the public or semipublic domain,” Scott said.
• DC fast chargers will shake up the public market, and more providers will roll out public “trio” chargers that offer Type 2 charging as well as both CHAdeMO- and CCS-compatible DC fast charging.
• Business conditions will be tough for companies that manufacture AC charging stations. “With margins so small and AC domestic chargers being such low value-added products, it’s difficult to see a sustainable future for many AC EVSE manufacturers, which means that consolidation in the market is likely this year,” Scott said.
• Lithium-ion battery prices are decreasing as a result of a price war between LG Chem and Panasonic, and carmakers will soon be offering 40-kWh batteries, which translates to at least a 150-mile range. “Less than $250 per kWh for a lithium-ion battery is the generally accepted price level for these batteries to become mass market in automotive – a price we will get closer to this year,” Scott said.
• Public charging-station operators and owners will continue to struggle to make a profit on EV charging in 2014. Other forms of revenue generation, such as advertisements, will grow in importance.
• This year will be important for “new energy vehicles” in China. The city of Beijing alone plans to deploy a total of 170,000 NEVs from 2014 and 2017.
• Plug-in prices are expected to decrease in 2014, as more OEMs enter the market place. However, government incentives are still critical if countries are serious about EV adoption. “Legislation and incentives are proven to make a significant difference to EV consumer interest as was seen in the Netherlands at the end of 2013, when a tax incentive ended. In this country, more Mitsubishi Outlander PHEVs sold in December 2013 than the combined US sales of the Chevrolet Volt and Nissan Leaf in the same month,” Scott remarked.

Source: IHS via AutoBlog Green