Soaring 29% year - on - year, global electric vehicle sales hit a record high

Although electric vehicles (EVs) did not grow as rapidly as some expected in 2024, global sales have started 2025 with much stronger momentum.

New data shows EV sales are growing at record levels across all major global markets. While this trend is evident, policy changes under the Trump administration—particularly subsidy cuts and new tariff policies—could begin to curb this growth as time progresses.

Recently, EV intelligence research firm Rho Motion reported that global EV (battery electric vehicles + plug-in hybrids) sales reached 1.7 million units in March 2025, with 4.1 million units sold in the first quarter of 2025. Compared to March 2024, the EV market grew by 29% in March 2025, and by 40% compared to February 2025.

This growth is primarily driven by the sustained strong momentum in China and Europe. While growth rates remained flat compared to previous months, geopolitical factors have begun influencing regional performance—especially in North America. Sales in the rest of the world grew by 27% in the first quarter, reaching approximately 300,000 units.

Charles Lester, Data Manager at Rho Motion, commented: "Despite the turbulent landscape, the global EV market showed robust growth in the first quarter. For example, the UK set a sales record in March as consumers continued to switch to EVs. In France, the removal of subsidies had a dampening effect, with sales falling by 18%. Meanwhile, subsidy cuts in North America and high tariffs on highly international supply chains will certainly cool the industry."

1. China

Driven by sustained consumer demand and domestic incentives, China's new energy vehicle (NEV) sales continue to lead globally.

Rho Motion data shows that China's EV sales reached approximately 1 million units in March 2025, nearing the all-time high set in August last year. In the first quarter of 2025, China's EV sales grew 36% year-on-year to 2.4 million units.

Ongoing tariffs between China and the U.S. have had limited negative impact on EV sales due to low cross-border EV sales between the two countries. However, for Tesla's Model X and Model S exported from the U.S. to China, tariffs could nearly double their prices. Recently, Tesla has suspended reservations for the Model X and Model S in China.

2. Europe

In Europe, regulatory pressure and emission compliance requirements are driving the adoption of related technologies. In March this year, EV sales in Europe reached 400,000 units, up 24% year-on-year. From January to March, the European EV market grew by 22% to 900,000 units, mainly driven by a 27% increase in battery EV sales and a 10% rise in plug-in hybrid sales.

In some countries, battery EV sales have surged since the start of this year, with Germany seeing a 37% increase and Italy a 64% jump in battery EV sales.

In March 2025, UK EV sales hit a record high, selling over 100,000 units for the first time and setting its highest monthly sales record ever. Compared to March 2024, the UK market grew by 41%. Due to the new license plate system, vehicle sales in the UK are expected to surge in March (and September).

France, however, has been severely affected by reduced government subsidies, which has dampened EV sales. In the first three months of this year, EV sales in France fell by 18%, with battery EV sales down 5% and plug-in hybrid sales plummeting by 47%.

Currently, the EU is adopting a different strategy to boost EV sales, such as relaxing tariffs on Chinese EVs in exchange for setting price floors, aiming to maintain supply chain balance while supporting the development of EVs by European automakers.

3. North America

In March 2025, EV sales in the North American market (U.S., Canada, and Mexico) reached 200,000 units, marking a 12% year-on-year increase. Q1 EV sales in North America hit 500,000 units, up 16% from Q1 2024.

While specific sales ratios for EVs and plug-in hybrids weren’t released, data previously published by Cox Automotive and Kelley Blue Book showed that 296,227 battery EVs were sold in the U.S. in Q1 2025—an 11.4% increase from the same period last year.

Despite robust growth in other regions, North America’s slower pace is primarily due to tariff impacts. In February, President Trump announced a 25% tariff on imports from Canada and Mexico, followed by a 25% tariff on all imported vehicles and certain auto parts in March.

Uncertainties in emission standards and tariff enforcement have slowed corporate decision-making, with policy ambiguity and supply chain risks emerging as constraints on economic growth. It’s clear that U.S. EVs already struggle to compete on cost with internal combustion engine vehicles, so subsidy cuts and high tariffs on globally integrated supply chains will undoubtedly cool the industry.

Tariffs will fundamentally reshape the passenger vehicle market landscape. In 2024, about three-fifths of U.S.-sold EVs were domestically produced, but around 40% came from international factories in Japan, South Korea, and Mexico—many now facing stricter trade barriers.

This is particularly true for automakers from South Korea and Japan, as well as U.S. manufacturers operating in Mexico, which export large quantities of affordable models to the U.S. market annually.

The impact of auto tariffs on consumer purchasing power and market dynamics could be significant. While automakers may absorb part of the tariff costs, the measure is likely to alter the U.S. auto market’s pricing structure and competitive landscape, driving up prices for both ICE vehicles and EVs.