Welcome to Thoughts in the Market.

I'm Andrew Sheets, Chief Cross-Asset Stragist for Morgan Stanley Research.

And I'm Adam Jonas, Head of Morgan Stanley's Space and Global and Share Mobility Teams.

And on this special Earth Day edition of the podcast, we're talking about the intersection

of electric vehicles, climate change, and public policy.

It's Thursday, April 22nd, at 3pm in London.

And 10am in New York.

So Adam, for Earth Day, it seems appropriate to talk about the outlook for electric vehicles,

or so-called Auto 2.0, given the outsized role that vehicles play in carbon emissions.

Consumers and auto manufacturers have certainly made some strides towards electric and away

from internal combustion cars, but we still have a long, long road ahead for EV adoption.

Maybe you could just catch us up on how you see the pace of electric vehicle adoption

in the years ahead.

So the starting point of EV adoption is pretty low in the U.S. We're at around 2% of auto

sales are fully electric.

We don't include hybrids in that definition.

Anything with a tailpipe, we consider internal combustion.

And out of all vehicles on the road in operation, it's less than a half a percent.

So a really, really small number as the park penetration will lag.

By mid-decade, we get to around 7 or 8%.

By end of decade, we are targeting about 25% EV penetration in the U.S. and around 31% globally.

We do have modestly higher penetrations in markets like the European Union and in

...