Global sales of electric and plug-in hybrid vehicles rose by 24% in May compared to the same period last year, according to market research firm Rho Motion.

The increase was largely driven by strong demand in China, which recorded monthly EV sales exceeding one million units for the first time in 2025.

Chinese manufacturers, including BYD, contributed to this growth through strong domestic sales and targeted exports to markets such as Mexico, Southeast Asia, and Uzbekistan.

This was noted by Rho Motion’s data manager, Charles Lester.

In Europe, fleet incentives in Germany and rising demand in Southern Europe supported increased EV sales.

However, North America experienced slower growth due to the expiration of Canadian subsidies and ongoing import tariffs in the US. The US currently imposes a 25% tariff on global automakers.

🔗 Source: Reuters

🧠 Food for thought

1️⃣ Regional policy disparities are reshaping the global EV landscape

The stark contrast in regional EV adoption rates, with China surging past 1 million monthly sales while North America grows at just 5%, highlights how government policies dramatically impact market development.

Europe’s 25% sales increase correlates directly with the EU’s mandate requiring a 15% reduction in fleet-wide CO2 emissions from 2021 levels, effectively forcing manufacturers to prioritize electric models 1.

Meanwhile, North American growth has stalled amid uncertainty around emissions standards and tariffs, with EV sales reaching only 600,000 vehicles in early 2025 compared to China’s much larger volumes 2.

This divergence reflects how regulatory frameworks create entirely different market dynamics, with Chinese manufacturers like BYD strategically targeting export growth in regions with favorable policies.

The data demonstrates that consistent policy support remains the primary driver of EV adoption rates rather than technology improvements or consumer sentiment alone.

2️⃣ Tariffs are fundamentally restructuring EV manufacturing strategies

The implementation of 25% import tariffs in the United States is forcing global automakers to rethink their production and distribution strategies.