California’s continued electric vehicle market development

This briefing provides an update on the growth in electric vehicle sales in California through 2017. It quantifies electric vehicle market growth across California local markets, provides broader U.S. market comparisons, and describes these developments in the context of California’s 2025–2030 goals.

California remains home to several of the world’s electric vehicle capitals. The San Jose, San Francisco, and Los Angeles metropolitan area markets have some of the highest electric vehicle sales and market shares in the world. These three markets together, through 2017, already had more than a quarter-million electric vehicles on their roads. Within these three leading California metropolitan areas, 30 cities had electric vehicle shares of more than 10%; nine, more than 15%; and three, more than 20%.

Uneven progress reveals great potential for more marketing, increased local action, and incentives to grow the electric vehicle market. There is great variation in electric vehicle shares across major auto markets. Whereas many cities in the San Francisco Bay area have sales shares above 10%, other major cities such as Bakersfield, Riverside, and Sacramento have electric vehicle shares below the state average. To grow the market, lagging markets would benefit from more city actions (e.g., electric vehicle-ready building codes, expanded public parking and charging for electric vehicles), broader automaker marketing, and continued use of the consumer incentives will also remain important.

Several industry leaders are greatly outperforming policy goals. The auto industry has over-complied with the ZEV regulation requirements, with several times more ZEV credits than required through 2016. Several leading companies have already transitioned their fleets to greater electric vehicle shares than what is required for the fleet to meet California’s 2025 regulation. However, many companies have much lower electric vehicle shares, and most of the companies have not yet begun to make similar electric vehicle deployment efforts outside California.

More aggressive policy will be needed to achieve California’s long-term goals. California has set ambitious goals for 5 million electric vehicles by 2030 and all zero-emission vehicle sales by no later than 2050 to meet its air quality and climate objectives. This will require sales of electric vehicles to rise substantially over the next decade, perhaps to half of all new vehicle sales by 2030. The clearest way to ensure this outcome is with stronger regulations requiring that a much greater share of new vehicles have zero emissions by 2030, along with sustained purchasing incentives, consumer awareness campaigns, and infrastructure deployment.