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Tesla and Other Electric Vehicles Set to Reign Faster Than Expected

A report from Ernst & Young says global electric vehicle supremacy will arrive by 2033, five years quicker than expected, as demand for Tesla cars and other EVs surges.

Global electric vehicle supremacy will arrive by 2033 - five years earlier than previously expected - as tougher regulations on emissions, rising interest among consumers and ongoing infrastructure buildout drive demand.

A new study released by consultant Ernst & Young said that EV sales are set to outpace combustion engines in 12 years in Europe, China and the U.S., the world’s three biggest auto markets.

By 2045, non-EV sales were seen plummeting to less than 1% of the global car market, EY forecast, using an AI-powered prediction tool.

The study comes as carmakers including Ford  (F) - Get Report, General Motors  (GM) - Get Report, Volkwagen  (VW)  as well as Fisker  (FSR) - Get Report, NIO  (NIO) - Get Report and others move to catch up to mass-production electric vehicle pioneer Tesla  (TSLA) - Get Report.

The U.S. lags the world’s other leading markets because fuel-economy regulations were eased during President Donald Trump’s administration, according to the study.

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Since taking office in January, President Joe Biden has rejoined the Paris Climate Accord and proposed spending $174 billion to accelerate the shift to EVs, including installing a half-million charging stations across the country.

“The regulatory environment from the Biden administration we view as a big contributor, because he has ambitious targets,” Randy Miller, EY’s global advanced manufacturing and mobility leader, told Bloomberg. “That impact in the Americas will have a supercharging effect.”

That will help speed up mass-adaptation of electric vehicles in the U.S., which is already being displayed in consumer demand for the likes of Tesla’s hot-selling Model 3 to new electric models coming from legacy automakers, such as GM’s battery-powered Hummer truck and Silverado pickup, and Ford’s F-150 Lightning pickup.

Japan automaker Honda on Wednesday joined the growing list of car companies going all-electric, stating it will look to completely phase out sales of gasoline-powered cars by 2040. 

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