A sharp increase in gasoline and diesel prices, triggered by turmoil in the Middle East and the ongoing Iran war, has led to a surge in electric vehicle (EV) demand worldwide, including a notable rebound in the US used EV market. US dealers report that prices for used EVs have stabilized and inventories are shrinking faster than expected, reversing a previous slowdown caused by the expiration of government incentives. Market analysts attribute this renewed demand to consumer economics, with one dealer stating, 'The cost advantage of driving electric is now much more obvious to buyers, especially as gas prices reach new highs' [1]. Market sentiment remains upbeat, with traders monitoring further oil and gas price hikes that could bolster EV demand, and developments in the Middle East are being closely watched for their potential to drive energy prices higher and further stimulate EV adoption [1].
Chinese automakers, particularly BYD and Geely Auto, are aggressively expanding their presence in overseas markets. In March, China's passenger car exports surged 82.4% year-on-year to around 748,000 vehicles, up from 586,000 in February. Exports of new energy passenger vehicles, including battery electric vehicles and plug-in hybrids, jumped more than 140% year-on-year to 363,000 units in March, a 31% increase from February's 276,000 units [2]. The China Association of Automobile Manufacturers provided these figures, highlighting the rapid growth in overseas sales. Industry analysts note that the Iran conflict and resulting energy shock have not fully impacted March data, but are expected to act as a trigger for further EV adoption as consumers respond to rising fuel prices [2].
Chinese car brands have made significant inroads in Europe, Latin America, and Southeast Asia, with strong visitor interest at events such as the Bangkok International Motor Show [1][2]. The push for overseas expansion comes as domestic sales in China have declined, falling 19.2% year-on-year in March to nearly 1.7 million units, marking the fifth consecutive month of declines. This domestic weakness is attributed to scaled-back government support and a prolonged property sector slump [2]. However, UBS auto analyst Paul Gong predicts that the surge in overseas sales will more than offset domestic declines on a full-year basis, estimating that overseas passenger car sales by units for Chinese automakers might grow by 20% or more this year compared with last year [2].
Financial experts caution that sustained EV demand will depend on the stability of fuel prices and the availability of charging infrastructure. Technical analysis suggests that current support levels for used EV prices are firming, but a rapid reversal in fuel costs could weaken momentum [1].
CONCLUSION
The surge in global fuel prices due to the Iran conflict has significantly boosted demand for electric vehicles, particularly used EVs in the US and exports from Chinese automakers. While domestic sales in China remain weak, robust overseas growth is expected to offset this decline. Market sentiment is positive, but future demand will hinge on fuel price stability and infrastructure development.