Electric vehicles sales head toward a big drop

Global sales of electric vehicles are projected to drop by 43% this year as the technology faces a series of overlapping problems, the consultancy Wood Mackenzie finds in an analysis.

Driving the news: "The coronavirus outbreak, potential delays to fleet purchasing due to lower oil price and a wait-and-see approach to buying new models have all contributed to this decrease in projected sales," they write.

• They see worldwide sales of battery electric and plug-in hybrids at 1.3 million vehicles this year, compared to 2.2 million last year.

Why it matters: EVs remain a niche market, and the Wood Mackenzie report shows why COVID-19 means even more speed bumps on the path to the technology becoming mainstream — and for multiple reasons.

• "The automakers’ response to the pandemic — suspending car manufacturing to focus on making medical equipment — is only going to delay model launches further," Wood Mackenzie analyst Ram Chandrasekaran notes in the report.

But, but, but: Chandrasekaran also says that pent-up demand is expected to help a bounce back in sales later in the year, and the long-term trend is slated to remain upward.

• He points out that automakers have become more interested in climate-friendly product lines due to government policies and investor attitudes.
• "The shift towards sustainability is the driving force behind the electrification of transport. Uncertainty caused by the oil price war and global catastrophes will only serve to strengthen that resolve, not deter it."

Go deeper: Tesla to cut employees' pay up to 30% and furlough workers