Vision 2050: Update on the global zero-emission vehicle transition in 2025 – International Council on Clean Transportation
Report
January 29, 2026 |
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Decarbonizing the road transport sector, which contributes almost one-fifth of global carbon dioxide (CO2) emissions, is essential for achieving Paris Agreement goals to limit warming to well below 2 °C. Transitioning to zero-emission vehicles (ZEVs) is the most promising pathway to decarbonize road transport, and this shift is now backed by significant policy and market momentum.
This study is the fourth iteration of the International Council on Clean Transportation’s annual update on the global ZEV transition. This report projects the impact of global ZEV policies and market developments on vehicle sales, energy use, and emissions through 2050. In addition to updating the baseline scenarios in our previous studies (Baseline 2021 and Baseline 2024), we model three distinct pathways: a Baseline 2025 scenario that considers adopted policies as of August 2025, a Momentum scenario that incorporates non-binding ZEV targets and proposed policies, and an Ambitious scenario aligned with the Paris Agreement. Our findings quantify the substantial impact of recent policy adoption on ZEV projections and highlight the remaining policy gap to achieve a trajectory aligned with climate goals.
Policies adopted over the past 4 years have significantly reduced the projected CO2 emissions through 2050. The Baseline 2025 scenario shows projected emissions peaking by 2025 and declining thereafter, driven by regulations in major markets pushing higher ZEV shares of new vehicle sales and continued market uptake driven by falling ZEV costs. This trajectory represents a marked improvement over the Baseline 2021 scenario, avoiding 20 billion tonnes of CO2 emissions cumulatively through 2050.
If governments achieve their stated ambitions (Momentum scenario), cumulative emissions will fall by an additional 11 billion tonnes. However, a significant gap of 47 billion tonnes remains between the Momentum scenario and the Paris-aligned Ambitious scenario, which represents a trajectory for global ZEV uptake compatible with limiting warming to well below 2 C.
This graphic shows CO2 emissions only to allow a direct comparison with the estimated carbon budget for road transport. The full report also factors in the effects of non-CO2 pollutants, which add approximately 11% in CO2-equivalent compared to the CO2-only numbers shown here.
Sales shares of electric vehicles (EVs), which include ZEVs and plug-in hybrid electric vehicles (PHEVs), have grown rapidly from 2024–2025. While China remains the largest market for electric passenger cars, the fastest growth has occurred in emerging economies like Vietnam, Thailand, Türkiye, and Indonesia. This growth is driven by beneficial fiscal policies, strong domestic manufacturing (Vietnam and Türkiye), and cost-competitive Chinese imports (Thailand and Indonesia). China and the European Union lead in ZEV uptake for the medium- and heavy-duty truck segments. Both markets have achieved double-digit sales shares, with several countries in the European Union surpassing 50% for electric medium trucks in the first half of 2025 and China leading in the heavy-duty segment with double-digit EV sales shares.
Emerging economies saw the fastest growth in EV sales share from 2024-2025, specifically Vietnam, Thailand, Türkiye, and Indonesia
Between September 2024 and August 2025, no new major supply-side regulations were adopted; instead, governments with stringent rules like the European Union and the United Kingdom added near-term flexibilities, and a new U.S. administration sought to roll back federal and state rules. Policy proposals from major markets, such as Vietnam, Thailand, Mexico, and India, could still drive future reductions. However, the United States risks falling behind other markets if rollbacks of existing regulations are successful.
Global road-transport emissions and liquid fuels consumption could peak as soon as 2025.
In all except the most conservative scenario, emissions from road transport are projected to peak as soon as 2025. This peak is driven by emission reductions coming from vehicle efficiency improvements and electrification in large markets such as China and the European Union. However, the timing of peak emissions also depends on vehicle activity growth in addition to policy and market developments.
A sizable ambition gap remains between stated targets and a Paris-aligned trajectory.
Realizing the current stated targets and proposals of the Momentum scenario would result in a 31 billion tonne reduction in CO2 emissions by 2050, relative to a 2021 policy scenario, representing 40% of the cuts needed. However, a significant gap in projected ZEV sales shares between the Momentum scenario and the Ambitious scenario, which is aligned with the Paris Agreement, persists and widens over time, especially for heavy-duty vehicles.
The difference in policy ambition creates wide regional gaps. The Momentum scenario closes approximately 90% of the emissions gap in Canada, the European Union, and the United Kingdom but less than 20% in Brazil, South Korea, and the United States. The United States is an outlier, as proposed rollbacks mean its Momentum scenario projects higher emissions than its baseline. These rollbacks drop the U.S. emissions gap closure from 60% in the Baseline 2025 scenario to just 14% in the Momentum scenario, significantly impacting the global emissions trajectory.
The California Air Resources Board repealed its Advanced Clean Fleets regulation in January 2025 in a legal settlement, though some state and local government requirements remain in effect (removed from Baseline 2025 scenario). Furthermore, in May 2025, the Advanced Clean Cars II (ACC II) and Advanced Clean Trucks (ACT) waivers were revoked by Congress through Congressional Review Act resolutions DieselNet, 2025). California subsequently filed a lawsuit disputing the legality of the usage of the Congressional Review Act and reiterated its commitments to meet the long-term targets through an executive order (Newsom, 2025).
In December 2024, the province of Quebec adopted a regulation requiring 100% ZEV sales of light-duty vehicles by 2035, a target that was set previously but that the regulation made legally binding. This regulation is in line with the national Electric Vehicle (EV) Availability Standard intended to promote the adoption of EVs, but specifies a credit system for plug-in hybrid vehicles (PHEVs)—a full credit point for those with a range over 80 km, and half of a credit point for those with a range below this limit (Government of Quebec, 2025). (Added to the Baseline 2025 scenario)
The Ministry of Industry and Information Technology approved China’s Stage 4 fuel consumption standard for heavy-duty commercial vehicles in September 2024. The standard tightens fuel consumption limits by roughly 12%– 16% compared with Stage 3, depending on the vehicle type (Liu & Mao, 2024). The Stage 4 standards were implemented in July 2025 for new type approvals, and on July 1, 2027, they are expected to be implemented for all new heavy commercial vehicles sold in China (Ministry of Industry and Information Technology, 2024). (Added to the Baseline 2025 scenario)
Flexibilities to the adopted CO2 emission standards for cars and vans were approved in May 2025. These allow auto manufacturers to average their performance over the 2025–2027 period rather than requiring a specific target to be met in 2025 (Regulation [EU] 2025/1214). (Updated in the Baseline 2025 scenario)
At the national level, proposed fuel efficiency norms for light commercial vehicles and medium- and heavy-duty vehicles (MHDVs) were issued by the Bureau of Energy Efficiency in July 2025 (Bureau of Energy Efficiency et al., 2025). Additionally, a 100% ZEV sales target for HDVs has been proposed for 2050 under the Bharat Zero Emission Trucking Policy Advisory document issued in 2024 (Office of the Principal Scientific Adviser to the Government of India, 2025). At the sub-national level, various EV targets have also been proposed. The Delhi EV Policy 2.0 was proposed in March 2025 and targets 95% of new vehicle registrations to battery electric vehicles, strong hybrids, and PHEVs by 2027 (Narla & Bhatt, 2025). The state of Andhra Pradesh has set a goal of 230,000 EVs registered by 2029 (Government of Andhra Pradesh, 2024). The states of Madhya Pradesh and Maharashtra have set sales share targets for two- and three-wheelers, passenger cars, and buses for 2030 (Government of Madhya Pradesh, 2025; Government of Maharashtra, 2025). (All policies added to the Momentum scenario)
Mexico’s Secretariat of Environment and Natural Resources released its Phase 2 federal CO2 emission standards for LDVs in January 2024, which establish mandatory annual fleet-average CO2 limits for model years 2025–2027. The annual targets are set to achieve 89 g CO2/km for passenger cars and 131 g CO2/km for light commercial vehicles by 2027. These standards update Phase 1 emission standards, which have been held constant since 2016 due to a pause in the regulatory process in 2019 (Jiménez & Pineda, 2022). (Added to the Baseline 2024 and 2025 scenarios)
In April 2025, the UK Department for Transport slightly relaxed its ZEV regulation for new cars and vans, which sets annual ZEV sales share requirements starting in 2024 and requires 80% of new cars and 70% of new vans be ZEVs by 2030. While these targets will remain in place, the ZEV credit system is loosened, allowing for an extended period where credits can be earned by reducing fleet-average CO2 emissions in non-ZEVs. (Department for Transport, 2021). (Updated in the Baseline 2025 scenario)
At the national level, the U.S. Environmental Protection Agency has proposed to repeal the endangerment finding that allowed it to regulate GHG emissions, which if finalized would prevent enforcement of the existing multipollutant regulation for LDVs and Phase 3 regulation for HDVs (Environmental Protection Agency, 2025). The lack of enforcement of ACC II and ACT pending legal challenges means that the national adoption rates in the Momentum scenario, excluding California due to the aforementioned executive order, are similar to those of Baseline 2021, which considered a scenario with no new adopted policies. The Baseline 2025 scenario does not include the changes incorporated into the Momentum scenario due to the endangerment finding still not being finalized as of August 31, 2025, and the questionable legality of the ACC II and ACT repeals. However, it does include small lags in ZEV adoption compared with Baseline 2024 due to delays introduced by several states in addition to California (Maryland, Massachusetts, New Jersey, Oregon, and Vermont) in the implementation of ACC II and ACT.
In addition to these major markets, Ethiopia, Nepal, and Tasmania have announced ZEV targets since August 2024. Also, three new signatories (Peru, Mozambique, and Montenegro) have signed the Global Memorandum of Understanding on Zero-Emission Medium- and Heavy-Duty Vehicles (MOU on ZE-MHDVs), committing to reaching 30% ZEV shares in new HDV sales by 2030 and 100% ZEV shares in new HDV sales by 2040. (All policies added to Momentum scenario)
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