IEA: Will the EV Market Continue to Grow in 2026?

Global electric car sales are expected to rise in 2026, following strong growth in 2025, according to the International Energy Agency (IEA).

It predicts that sales will reach 23 million, accounting for almost 30% of all cars sold worldwide.

The figures have been released in the newest edition of IEA’s annual Global EV Outlook.

Key takeaways from the Outlook

The Global EV Outlook explores key market trends related to electric vehicles (EVs) and charging infrastructure, as well as changing policy and regulations.

In 2025, global electric car sales grew by 20%, exceeding 20 million. This accounts for a quarter of all new car sales worldwide.

Chinese automakers accounted for 60% of electric car sales, with European and North American manufacturers accounting for 15% each.

Fatih Birol, Executive Director of the IEA, says: “Electric car sales set new records in close to 100 countries last year. 

“The growing popularity of EVs has marked a major shift for car markets and the energy system as a whole – and it is providing some relief now amid the largest oil supply shock in history.

“Looking ahead, the falls we have seen in battery prices and the potential policy responses to the current global energy crisis are set to provide further momentum in EV markets.”

EV growth in Europe

Europe saw the strongest growth among major EV markets in 2025, with car sales rising by more than 30%.

This came after a change in the European Union’s regulations on CO2 emissions for passenger cars.

The IEA found that current high oil prices, in part due to the energy crisis stemming from the conflict in the Middle East, have drawn more consumer attention to EVs

Electric cars typically have lower running costs than internal combustion engine (ICE) vehicles, which bring economic benefits to consumers.

The report reveals that in the first quarter of 2026, electric car sales set records in multiple markets worldwide.

In Europe, sales were up 30% year-on-year; the Asia Pacific region excluding China saw growth of 80%; and the Latin American market grew by 75% in Q1.

In March 2026, 30 countries had record-breaking monthly sales and a further 60 countries recorded year-on-year sales growth.

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The impact of policies and trade

According to the IEA, policies and price dynamics are set to drive EV sales, with the share of sales in Southeast Asia predicted to increase by up to three times by 2035.

Trade is also a key factor in the rise in EV adoption, with approximately one quarter of electric cars produced in 2025 being traded between countries.

Almost 22 million electric cars were produced worldwide in 2025, an increase of more than 25% over the previous year.

Chinese EV exports doubled to a record high of more than 2.5 million in 2025, with the country remaining the world’s largest EV manufacturing hub.

In addition, China accounted for more than 80% of battery cell production in 2025.

Nearly all of the battery cells used around the world are supplied by companies from China, Korea and Japan, especially those shipped to EU countries.

Lithium-ion battery manufacturing capacity also grew in the EU and the US in 2025.

The IEA’s report reveals that new battery cell technologies and battery pack architectures are enabling more efficient, higher-voltage charging systems.

This means that grid capacity constraints could become more problematic in some regions around the world, as EV deployment and charging speeds continue to increase.