Electric vehicles (EVs) will account for 90 per cent of car sales globally by 2050, while China is expected to maintain a 50 per cent share of global pure EV sales until 2030, the Bank of America Merrill Lynch said in a report.
The report, published by a team led by Fraser Hill, who heads equity research at the bank, expects EVs to reach a global share of 34 per cent in 2030 and 90 per cent in 2050.
The report also highlights that China will be leading in market share by 2030 as well as 2050. Until 2030, China will have about 50 per cent of the market share, according to the South China Morning Post.
"Chinese original equipment manufacturers (OEMs) are likely to emerge as leaders in the pure EV market, supported by the government's favourable subsidies and the recent 2019/2020 new energy vehicle targets," the report said. "China's estimated 50 per cent share of global pure EV sales should be maintained up to 2030."
Europe is expected to be a close second in market share but European OEMs are experiencing a slow start in vehicle electrification.
"German OEMs have committed to diesels in an effort to bridge the gap to European Union CO2 targets," the report said. "European OEMs' strategies are starting to focus on pure EVs, but German OEMs lag with no new EVs before 2019."
China last year sold a record 336,000 EVs, surpassing the US as the country with the highest electric car stock, around a third of the global total, according to a report by the International Energy Agency.
The boom, which started three years ago, was largely thanks to generous government subsidies.
Last month, the Chinese government announced a dual-credit scheme that will be launched in 2019, requiring carmakers to produce a minimum number of EVs. Those failing to meet minimum production targets will have to buy credits from competitors with surplus credits. Vehicles that meet range, or distance, targets will also earn credits.
"The government decided to cut subsidies gradually to allow the industry to stand on its own, as it was heavily reliant on subsidies previously," said Cao Nanxin, a senior industry analyst at research advisory China Policy.
Yutaka Sanada, Nissan's senior vice-president of Asia and Oceania excluding China and India, said the rising demand for EVs has given Chinese carmakers and their Asian suppliers a golden opportunity to "impress and improve".
Sanada said the advances made by Chinese companies will also open many doors for production integration down the road.
"Once the Thai market's electrification demand increases, we may also try to link Chinese electrification part suppliers [with our local production]," he said.