Once known for its high-performance gasoline vehicles, the United Arab Emirates is quickly becoming an unlikely frontrunner in electric vehicle (EV) adoption within the Middle East, reflecting the global shift in energy towards cleaner alternatives.
A combination of ambitious environmental goals, extensive charging infrastructure, and a wider selection of vehicles across various price ranges are propelling this EV transition. According to recent data from the Ministry of Energy and Infrastructure, EVs accounted for 13% of total car sales in 2023, up from 3.2% in 2022 and just 0.7% in 2021. Approximately 260,000 new automobiles were sold in the UAE in 2023, as reported by the data analytics company Statista.
This shift highlights a significant transformation for a nation traditionally centered on oil production, with green transportation playing a vital role in its strategy for economic diversification and sustainability. According to Sharif Al Olama, undersecretary for energy and petroleum affairs, the UAE aims for EVs to comprise 50% of all vehicles on its roads by the year 2050.
“The UAE is firmly committed to transitioning towards cleaner, more sustainable energy sources,” Al Olama stated. “Prices are falling, demand is increasing, and the infrastructure is growing at a rapid pace.”
By last year, the UAE had over 147,000 electric and hybrid cars on its roads, with EV registrations rising more than 25% annually. New vehicle sales in the UAE reached 316,000 units in 2024.
147,000 Number of EVs and hybrids in UAE as of 2023
Given the rapid pace of innovation and consumer enthusiasm, the UAE may achieve its 2050 EV targets well ahead of schedule, according to Alessandro Tricamo, a partner at Oliver Wyman, a consulting firm based in Dubai.
“If Norway, an oil-rich nation, can achieve over 96% of new car sales being EVs, there’s no reason the UAE can’t follow suit,” Tricamo remarked.
The desire for EVs in the UAE is evident, with nearly two-thirds of residents stating they would prefer to use electric vehicles as their main mode of transportation by 2025, according to a joint survey conducted by Al-Futtaim, the UAE’s largest car dealer, and YouGov, a London-based market research firm, which surveyed over 2,000 participants.
“The swift rise in the adoption of new energy vehicles represents a thrilling new chapter for mobility in the UAE,” commented Paul Willis, president of Al-Futtaim Automotive. “The UAE’s active efforts to diversify its oil-dependent economy are setting the stage for increased electrification and carbon reduction in various sectors, including transportation.”
The UAE’s EV surge is rooted in its bold environmental initiatives. In January 2017, the country unveiled its Energy Strategy 2050, followed by the Net Zero 2050 plan in October 2021. Both initiatives aim to reduce emissions and increase the contribution of clean energy to the national power mix by 30% by 2031.
“This movement is driven by a mix of cost benefits, climate awareness, and strategic policy,” Willis explained. “However, performance is also becoming a crucial factor. Modern new energy vehicles offer a smooth, quiet ride with instant torque and high-tech features that appeal to tech-savvy consumers.”
Tricamo noted that consumer perceptions of EVs have improved significantly, with buyers drawn to modern designs, advanced features, superior riding comfort, lower ownership and maintenance expenses, and an increasing environmental consciousness.
Al-Futtaim provides a diverse range of EV options, showcasing models from brands such as Toyota, Lexus, as well as Chinese manufacturers like BYD and GAC Aion, making electric vehicles accessible to a wider audience. New releases, such as the BYD Sealion 7 and hybrid versions like the Lexus LX 700h, are helping Al-Futtaim achieve sustained double-digit growth aligned with UAE’s objectives.
The main story is not simply about replacing oil but balancing and fortifying a future-ready economy.
Over the last decade, the UAE has rolled out various incentives to encourage the uptake of electric vehicles, ranging from immediate benefits to long-term strategies. Moutaz Louis, CEO of Smart Mobility International, a local EV distributor, stated that buyers are realizing that innovation, sustainability, and energy efficiency can coexist.
“The main story is not about replacing oil but about achieving balance and building resilience in a future-ready economy,” he asserted. “Electric and hydrogen-powered vehicles will increasingly dominate.”
Despite UAE fuel prices remaining about 20% lower than the average in the U.S., according to calculations, EVs are attracting consumers due to lower long-term operational costs and diminishing range anxiety, thanks to the expanding charging infrastructure. In May 2024, the Ministry of Energy and Infrastructure initiated UAEV, a collaboration with Etihad Water and Electricity, to create a nationwide charging network, aiming to establish 1,000 public charging stations by 2030, including many fast chargers.
BYD
The Dubai Electricity and Water Authority currently operates an extensive network of approximately 740 charging stations throughout the city. Launched in 2014, DEWA aims to expand its electric vehicle green charger network to 1,000 stations by the close of the year. Al-Futtaim intends to supply 10% of the nation’s charging stations by 2030 through Charge2Moov, a comprehensive charging solution for residential and commercial use.
Nonetheless, UAE’s initiatives still lag behind global leaders. By the end of 2024, China boasted 12.82 million charging points, a 49% increase from the previous year, adding 4.2 million points throughout 2024 alone, according to the Electric Vehicle Charging Infrastructure Promotion Alliance. The United States had over 204,600 EV charging stations as of March 2024, with California contributing nearly a quarter of that total, as per Statista.
In recent years, the UAE has offered various incentives to EV owners, including complimentary charging, parking benefits, and smart toll cards, while also implementing policy frameworks that require EV-ready infrastructure in new projects and introducing innovative green financing options.
“We’re witnessing a more structured approach now,” Louis explained. “It’s moving away from mere freebies and towards sustainable infrastructure and long-term viability.”
These advantages have been well-received by UAE consumers. According to Willis, EV owners spend only a fraction—about 25%—of what traditional car owners spend on fuel. Maintenance costs for EVs are also significantly lower due to fewer mechanical parts and longer service intervals.
Chinese manufacturers are crucial to expanding market options due to their competitiveness in both cost and technology. Brands like Avatr, BYD, and GAC Aion combine advanced battery technology with affordable pricing to compete with established manufacturers.
Smart Mobility has also begun to offer range-extended electric vehicles (REEVs), which feature electric drivetrains and onboard generators capable of covering over 1,000 kilometers (620 miles). No other company in the Middle East currently provides such vehicles.
By the end of 2025, vehicles powered by internal combustion engines could feel as outdated as horseback riding.
However, challenges remain in the UAE’s transition to electric vehicles. The extreme desert climate can affect battery performance, making it essential to continue expanding the charging infrastructure to meet rising demand. As the EV market grows, recycling of batteries and their secondary usage will become increasingly significant, Tricamo stated.
The government is collaborating with environmental firm Beeah to establish the nation’s first battery recycling facility for electric and hybrid vehicles, according to Al Olama.
“We are proactively addressing disposal challenges before they can hinder progress,” he asserted.
Additional steps, such as requiring a minimum number of charging points at gas stations and shopping malls, encouraging more entities to participate in the charging market, and introducing congestion charges, could further boost EV adoption, Tricamo suggested. “The transition to electric vehicles is occurring faster than anticipated,” he concluded. “By 2025, vehicles powered by internal combustion engines may seem as outdated as horseback riding.”