The PEV market will develop and grow, but not at the scale or pace previously anticipated by key proponents of the technology. The frequently quoted goal of reaching 1 million PEVs on the road in the United States by 2015 will not be met. Instead, the 1 million mark will be reached in early 2018. Many of the OEMs, suppliers, charging equipment and service providers, and other stakeholders interviewed for this report remain hopeful about reaching the 1 million goal soon after 2015, expecting one kind of market breakthrough or another.

Those betting on strong early growth curves hoped that battery prices would quickly fall, positive word of mouth would quickly spread, or automakers would introduce new models more quickly. There is little evidence that any one of such breakthroughs will happen to any significant degree in the next 5 or 6 years. In fact, the lion’s share of OEMs making PEVs are doing so at a very measured pace, vetting technology and consumer preferences. In the meantime, they are tracking to government mandates rather than producing based on expectations of creating an overnight sensation.

Startup PEV companies, many venture-backed, will face a difficult time meeting announced production numbers. That has been the case for the past few years, a time when several prominent startups have gone out of business or fallen in and out of bankruptcy. While Pike Research does not foresee a major single tipping point, a series of slight market improvements is anticipated—one adding to another, combining to gently push bigger production and sales numbers. Slightly lower battery costs will mean slightly lower purchase prices, spurring increased production of cars with slightly more range and easier charging. Positive word of mouth will slowly spread. Of course, a big wild card is gas prices, which are expected (but cannot be guaranteed) to rise.

—Pike Research report “Plug-in Electric Vehicles”

Pike Research forecasts the global PEV market will reach 137,950 units in 2012. US PEV sales will reach 47,966 units, making the United States the country with the highest number of PEV sales—a leading role it will retain at least through 2020. Of those nearly 48,000 sales in the United States, 27,992 will be PHEVs and 19,974 will be BEVs in 2012, Pike projects. Pike expects the US consumer preference for PHEVs over BEVs to continue throughout the forecast period.

The preference of US consumers for PHEVs over BEVs is expected to continue throughout the forecast period.

In contrast, the Japanese market is expected to see 32,226 sales of BEVs compared to just 2,840 PHEV sales in 2012. A preference for BEVs over PHEVs will be the pattern for the Asia Pacific region, where consumers will be amenable to the smaller BEVs that North Americans are more reluctant to purchase. Western Europe will fall somewhere in between, showing roughly equal sales numbers for both PHEVs and BEVs.

In the mid-term, the three global regions, North America, Asia Pacific, and Western Europe, will each represent roughly one-third of the PEV market. As China’s PEV market begins to grow in 2013 and expands throughout the decade, Asia Pacific will become the world’s largest market for PEVs.

—“Plug-in Electric Vehicles”