After several upward revisions to its forecast, the China Passenger Car Association expects China's new energy vehicle sales to reach 2.4 million units this year. Now, a report is offering an even higher forecast.

In a recent report, EVTank, a private think tank in China, predicted that sales of new energy vehicles in the Chinese market will reach about 2.8 million units in 2021, far exceeding the 2 million units it predicted earlier in the year.

The report cites a significant drop in the price of automotive power batteries due to technological advances and improved charging infrastructure as the reasons for the rapid growth of the new energy vehicle market.

The price of power lithium batteries for automobiles fell from 3,800 yuan ($587)/KWh in 2011 to 578 yuan/KWh in 2020, and the energy density of mass-produced batteries rose from 80Wh/kg in 2011 to 270Wh/kg in 2020, according to another report released by EVTank earlier this year.

EVTank expected that the future cost of power batteries for automobiles will still maintain about an average annual decrease of about 5 percent.

From a global perspective, the report predicts that global new energy vehicle sales will reach 18 million units by 2025.

The forecast figure was revised upward by 10 percent from the 16.4 million units it predicted at the beginning of the year, saying the main reason is that China's new energy vehicle market is progressing beyond previous expectations.

Global new energy vehicle sales in 2030 will reach 40 million units per year, with a penetration rate of about 50 percent, the report said.

By then more than 90 percent of new energy vehicles will be pure electric vehicles, and China will be the world's largest new energy vehicle market, EVTank predicted.

Chinese auto association raises NEV sales forecast to 2.4 million units this year