Demand for electric vehicles in Asia rises amid Middle East war

VIETNAM: The war in the Middle East, which started on Feb 28 when the United States and Israel began bombing Iran, has caused a global energy crisis after the effective closure of the Strait of Hormuz, a crucial chokepoint for the world’s fuel supply.

Asia, which obtains much of its energy needs from countries in the Gulf, has been particularly hard-hit, with countries grappling with significantly higher oil prices and scrambling to ensure they have enough fuel supplies.

One industry that may emerge ahead amid the crisis is the electric vehicle (EV) sector, with reports saying that there has been a surge in demand for electric cars.

Masa Uchiyama, analyst at Daiwa Securities Group, said, ”Higher petrol and diesel prices are creating an atmosphere that is conducive to EVs.”

Chinese and other manufacturers, including Vietnam’s top electric vehicle maker Vinfast, are benefiting from the increased demand, the AFP reported recently. In March, Vinfast sold 27,600 units, a 127% increase in annual sales.

Vinfast’s showrooms are now extending their opening hours, and a sales associate for the company said that while his outlet normally sells 200 to 250 units per month, in March, between 300 and 400 were sold.

Beyond the region, the number of registrations of EVs in South Korea and Japan, as well as in New Zealand, more than doubled in March. In Australia and India, it increased by more than 50%, according to Capital Economics.

This should come as no surprise, with the price of crude oil having gone up by around 50% since Feb 28 and was up again on Monday morning (April 20), following renewed tensions in the Middle East.

The Chinese EV manufacturer BYD is similarly showing an uptick in sales in Thailand and the Philippines. For the first time ever, BYD moved more units than Toyota in Thailand.

The company has since adjusted its sales projection for exported EVs from 1.3 million to 1.5 million, and BYD’s overseas market share has more than doubled to 22.7% this year. /TISG

Read also: Malaysia moves to establish itself as Southeast Asia’s electric vehicle powerhouse