Global growth of pure EVs faces hurdles in insurance, charging gaps: BNP Paribas

The global energy crisis may be pushing the balance towards pure electric vehicles (EVs) amid worries about surging petrol bills, but BNP Paribas is cooling down expectations as a lack of charging infrastructure and high insurance costs remain major stumbling blocks. The forecast could dampen investor enthusiasm for Chinese makers of battery EVs, which had surged in the past two months on the back of rising exports. “The infrastructure readiness is not necessarily there” in many countries, said James Kan, head of industrials research in Asia-Pacific at BNP Paribas, which opened its two-day annual EV and mobility conference in Hong Kong on Monday. “We believe EVs and internal combustion engine vehicles will coexist longer.” Kan counted China and Europe as the top markets in terms of infrastructure readiness, adding that the US and some emerging countries were reverting to partly electrified options like hybrid EVs because of ageing grid networks. Across all power trains, battery EVs are fully independent of petrol, while hybrid EVs and plug-in hybrid EVs combine an internal combustion engine with an electric motor. Kan said saved petrol costs could be offset by insurance and maintenance expenses for EVs in some emerging markets. BNP Paribas calculated that the total annual fee of a hybrid EV is only slightly higher than that of a battery EV in Thailand. That would give headroom to hybrid EVs and plug-in hybrid EVs in the regions whose grid networks remained unready for a large-scale use of battery EVs, including the Middle East, according to Kan. Even in western Europe, plug-in hybrid EVs picked up quickly in the first quarter after the European Union imposed tariffs of up to 35.5 per cent on EVs exported from China. China exported more than 1 million EVs in the first quarter, up 75 per cent from a year earlier, with the share of plug-in hybrid EVs and hybrid EVs expanding to 23 per cent of all vehicles in March, data from the China Passenger Car Association (CPCA) showed. The better-than-expected outbound shipments were mainly boosted by plug-in hybrid EVs and hybrid EVs, which replaced battery EVs as the new drivers of export growth, the industry body said in a note on May 11. BNP Paribas nevertheless expected Chinese cars to continue to grow in Europe, likely to capture a 10 per cent market share by the end of 2026, and 20 per cent within five years. Total shipments from the world’s largest auto market were projected to exceed 10 million units this year, indicating a 20 per cent rise from 2025’s 8.32 million units. In China’s domestic market, Ganfeng Lithium said commercial vehicles like electric trucks would help fill the gap left by falling passenger car sales amid subsidy pullbacks, said Wang Xiaoshen, president and vice-chairman of the board at the mineral chemicals and battery supplier, during a panel at the BNP event. Robotaxis were also expected to post substantial growth in China, helping boost average daily trips to 200 million in the future, according to Xin Gong, executive director and CEO at Caocao.