In 2021, electric cars accounted for nearly two-thirds of new car sales in Norway, with Tesla being the best-selling brand overall, as the nation strives to be the first to phase out gasoline and diesel vehicles. While Norway has the largest rate of electric vehicles in the world, with a total of 5.4 million, China, with 1.4 billion people, is by far the largest overall automotive market.
Norway, a major oil producer, has aided the transition to zero-emission vehicles by omitting battery electric vehicles (BEVs) from the taxes levied on internal combustion engines (ICE). This tax incentive is predicted to boost the proportion of total electric vehicle sales to as high as 80% by 2022, well ahead of the 2025 deadline to phase out gasoline and diesel vehicles.
In 2021, total new automobile sales in Norway increased by 25% to a record 176,276 vehicles, with 65 percent of them being totally electric. This market share increased from 54% in 2020. Despite its small size, Norway’s affluent population is seen as a vital market for new BEV players like China’s Nio and Polestar, a Swedish Volvo Cars (VOLCARb.ST) affiliate.
According to the Norwegian Road Federation (NRF), Tesla (TSLA.O) had an 11.6 percent share of Norway’s overall automobile market in the year 2021, giving it the number one product for the very first time on a full-year basis, ahead of Volkswagen (VOWG p.DE) with 9.6 percent.
The American automaker beat Wall Street projections for quarterly sales on Sunday, riding out worldwide semiconductor shortages as it increased China manufacturing, sending its stock to a single-month high on Monday. In Norway, the Tesla Vehicle 3 was the most popular model of the year, ahead of Toyota’s (7203.T) hybrid RAV4, the only car in the top ten with an internal combustion engine (ICE), and Volkswagen’s (VOWG p.DE) electric ID.4, which came in third.
EV sales are expected to reach up to 80% of the overall market in Norway by 2022, according to industry representatives, though supply chain issues may put a halt to this. “We expect we will approach 80% electric vehicles next year,” said Christina Bu, the Norwegian EV Association’s head. “However, that forecast is fraught with uncertainty, and it is reliant on the shipping snafu – several carmakers are experiencing delivery issues,” she noted.
Polestar Chief Executive Officer Thomas Ingenlath said Reuters, “Norway is the nation with the most receptivity to EVs, the most understanding of what it means to drive an EV, and the most receptive for having an option.” Polestar’s luxury sedan was Norway’s 10th most popular automobile type in 2021, and the Polestar 3 SUV will launch in 2022.