Despite the difficult circumstances created by the pandemic and the global microchip shortage, electric vehicles made a giant leap forward in many countries in 2021. According to an analysis from PwC's Strategy&, battery electric vehicles accounted for 8.2 percent of new registrations across 14 major markets last year, up from just 4.1 percent in 2020. While several European markets as well as China achieved double-digit market share in 2021, the United States lags behind with a BEV share of just 2.6 percent. Like in previous years, Norway was a positive outlier with a 65-percent share of electric vehicles, while Iceland, Sweden, Denmark and Finland also featured high on the list – a testament to the quick adoption of electric cars in nordic countries. China, which is by far the largest market for electric cars in terms of unit sales, also more than doubled its electric market share to 12.7 percent of new registrations.
While Norway’s policy measures (e.g. tax exemptions, toll exemptions and other incentives) did prove highly effective in promoting electric cars, the Norwegian model cannot be easily transferred to other countries. First and foremost, the country imposes hefty vehicle import duties and car registration taxes, making cars significantly more expensive than say in the United States. By waiving these duties for electric vehicles, Norway is effectively subsidizing EV purchases at a level that a larger country such as the U.S. couldn’t afford. Secondly, Norway is a very wealthy country (ironically thanks to its oil reserves) with a high level of income. According to Norway's national statistical institute, the country’s median household income after taxes was around $54,000 in 2019, which is roughly level with the United States but significantly higher than the EU average.