In recent times, the swift evolution of new energy vehicles has been unstoppable. Against this backdrop, it's widely accepted that electric vehicles (EVs) will dominate the automotive landscape in the future. Nevertheless, recent reports from certain media outlets suggest that the growth rate of global EV sales might decelerate by 2026. Are EVs truly becoming harder to sell?

I. Will the Growth Rate of Global Electric Vehicle Sales Decelerate in 2026?

According to a report by Jiemian News, the annual sales growth rate of EVs is projected to hit its lowest point since the 2020 global economic downturn caused by the pandemic in 2026.

Benchmark Mineral Intelligence, a research institution, predicts that global EV sales will expand by 13% year-on-year in 2026, reaching 24 million units, compared to an anticipated 22% increase in 2025. The industry is poised to bid farewell to the era of high-speed growth dividends and enter a new phase marked by both decelerated growth and profound industry reshuffling.

This deceleration trend is prevalent on a global scale: In the U.S. market, sales are expected to plummet by 29%, from 1.5 million units in 2025 to 1.1 million units, due to the cancellation of tax incentives. In Europe, after an expected 33% growth in EV sales in 2025, the growth rate is anticipated to slow down to 14% this year, reaching 4.9 million units.

As the world's largest EV market, China is projected to witness sales increase from 13.3 million units to 15.5 million units, with a growth rate of 17%. Although this represents positive growth, it's significantly lower than the high-speed growth levels observed from 2020 to 2025. According to UBS Group's forecast, the full-year growth rate in the Chinese market might be 8%.

The weakening of global policy support is one factor exacerbating market cooling and slowing sales. The United States has canceled EV tax incentives, and Ford CEO Jim Farley noted that the market share of EVs in the U.S. new car market might slip from around 10% last year to 5% in the short term. The European Union has also relaxed its original 2035 ban on fuel vehicles. Additionally, starting from 2026, China will shift from fully exempting purchase taxes for new energy vehicles to a 50% reduction, which will also curb demand in price-sensitive markets.

II. Why Are Electric Vehicles Facing Tougher Sales Challenges?

Recently, a sentiment has emerged in the market: The growth rate of global EV sales is expected to decelerate in 2026. Are EVs truly facing tougher sales challenges?

Firstly, the deceleration in industrial growth is an inevitable step towards maturity. From an economic standpoint, no industry can sustain indefinite high growth; a slowdown after a certain period is the norm. High-speed growth is often characteristic of emerging industries in their infancy, relying on a confluence of factors such as technological breakthroughs, market gaps, and capital fervor. However, as market penetration increases, the pool of potential users naturally shrinks, and the space for marginal growth narrows accordingly. The EV industry is no exception. Over the past few years, the global EV industry has witnessed double-digit annual compound growth rates, a pace rarely seen in the history of global manufacturing.

Nevertheless, when a product transitions from 'early adopters' to 'mass consumers,' its growth curve inevitably flattens. This is not a crisis but a normal phenomenon in the industrial life cycle. Looking back at the development history of all industries, whether it's the pivotal sectors during the first and second industrial revolutions, such as steam engines and internal combustion engines, or those during the current technological revolution, such as smartphones, internet services, and even high-speed rail networks, they all enter a period of steady growth or even a plateau after the initial surge. This is an inevitable periodicity in industrial development. Therefore, the slowdown in EV sales growth in 2026, from the perspective of the larger industrial life cycle, is not a signal of industry decline but rather a sign of its entry into a mature stage.

Secondly, the global reduction in subsidies will inevitably lead to changes in growth rates. For the new energy vehicle industry, after experiencing stimulus policies from various countries in previous years, significant development has been achieved, and the reduction in stimulus policies is a natural progression. In earlier years, due to the nascent stage of new energy vehicles, market awareness was insufficient, and there was significant skepticism. To promote the development of the new energy vehicle industry and attract consumers worldwide to actively purchase new energy vehicles, various countries introduced a series of stimulus policies, including purchase subsidies, tax reductions, free parking, etc. These policies played a crucial role in the early stages of new energy vehicle industry development, significantly lowering the threshold for consumers to purchase vehicles, enhancing the market competitiveness of new energy vehicles, and thereby stimulating rapid growth in market demand.

However, as the new energy vehicle industry gradually matures, these stimulus policies also face pressure to scale back. On one hand, the government's financial burden increases, making long-term large-scale subsidies unsustainable. On the other hand, the industry itself needs to break free from policy dependence and achieve market-oriented development. As stimulus policies gradually scale back, the price advantage of new energy vehicles will relatively weaken, which may, to some extent, affect consumers' willingness to purchase, thereby leading to a slowdown in sales growth.

Nevertheless, we must also recognize that, akin to a child's growth, according to the renowned economist Friedrich List's theory of protecting infant industries, early subsidies and policy support can effectively drive industry development. However, 'only grown-up children, not carried-up children.' Any industry that develops to a certain stage requires the scaling back of subsidy policies to stimulate self-development and the comprehensive formation of self-generating capabilities. Therefore, the scaling back of stimulus policies does not signify that the new energy vehicle industry will decline; instead, it is a necessary path for the industry to mature. Only by breaking free from policy support can the new energy vehicle industry truly test its competitiveness and achieve sustainable development.

Thirdly, enhancing overall product competitiveness is the paramount task for all new energy vehicle companies. As subsidies fade and policy dividends disappear, EVs will no longer enjoy 'special treatment' and must face full competition with fuel vehicles on the same track. This means that consumers will no longer choose EVs because of 'subsidies' but will make decisions based on real product value. Is the price reasonable? Is the range reliable? Is charging convenient? Is the intelligent experience superior to traditional models? These will become the core factors determining purchasing behavior.

Against this backdrop, companies that rely solely on stacking configurations, telling stories, or chasing trends will struggle to survive, while those with true full-chain integration capabilities, core technological barriers, and the ability to continuously iterate user experiences will have the opportunity to stand out. Facing competition on the same level as fuel vehicles, especially with fuel vehicles proposing strategies of 'equal intelligence between fuel and electric,' many new energy vehicle companies and fuel vehicle companies have reached similar levels of intelligent capability. What can new energy vehicle companies rely on to attract consumers to purchase new energy vehicles instead of fuel vehicles?

It is foreseeable that market competition in 2026 and beyond will no longer be an ideological battle between 'electric vs. non-electric' but will return to the most fundamental business logic: whoever better meets user needs will win the market. Although this competition is brutal, it is crucial for the healthy evolution of the entire industry.

Fourthly, the long-term outlook for new energy vehicles remains promising. In the long run, new energy vehicles will not become harder to sell; only after comprehensive market competition can new energy vehicles achieve better development. Although they may face challenges of slowing sales growth in the short term, the long-term development prospects for new energy vehicles remain very broad. As the market develops, new energy vehicles, as representatives of clean energy, align with the future development direction of the automotive industry. Moreover, with continuous technological advancements and cost reductions, the performance and price of new energy vehicles will become increasingly competitive, and consumer acceptance will continue to rise. Additionally, the development of the new energy vehicle industry will drive the development of upstream and downstream industrial chains, creating substantial employment opportunities and economic benefits.

Therefore, in the long run, the new energy vehicle market still holds immense potential. Comprehensive market competition will prompt new energy vehicle companies to continuously improve their technological capabilities, product quality, and service levels, driving the upgrading and development of the entire industry. Only by undergoing market trials and competition can the new energy vehicle industry truly mature and achieve better long-term development.

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