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Nicolas Couzin
Investment Manager
Emerging Markets Energy Transition Infrastructure
Mirova
Nico Tyabji
Investment Director
Emerging Markets Energy Transition Infrastructure
Mirova
The future of mobility is electric. The next growth market is emerging markets.
The debate is no longer whether transport will electrify. It is how quickly, where value will concentrate, and which investors are positioned to capture it.
The global transition is already well underway. Electric vehicles (EVs) represented roughly one quarter of new car sales globally in 2025, compared with just 4% five years earlier. Vehicle manufacturers alone are committing more than $1 trillion to EVs, batteries, and supply chains through 2030, while total annual investment in electrified transport is nearing $1 trillion globally1. These are not indicators of an emerging trend but rather of an industrial transformation already in progress.
The first phase of electrification was led by China, Europe and North America. The next phase will be driven by emerging markets, where demand is growing fastest, urbanization is accelerating, and demographic expansion remains strong. By 2050, 86% of the global population is expected to live in developing countries2.
Our lessons for this next phase come from over a decade of Mirova investments in emerging markets and over 6 years in
e-mobility worldwide.
While EV penetration remains below developed-market levels in most emerging markets, growth rates are significantly higher. Emerging markets are not simply catching up; they are becoming the primary engine of future demand3.
From an investment perspective, this distinction matters. For Mirova, climate impact remains central, but the investment case increasingly stands on its own economic merits. The combination of lower operating costs, improving technology, declining battery costs and strong underlying market drivers (e.g. rising utilization rates, demographics) is creating business models capable of delivering both financial returns and measurable impact.
Mirova has been actively investing in e-mobility infrastructure worldwide for over 6 years, supporting the development of scalable solutions in underpenetrated markets with strong growth potential. We believe the greatest opportunity lies in identifying the infrastructure, platforms and capital solutions that enable large-scale adoption.
EV adoption remains uneven across regions.
More than half of new vehicle sales in China are electric, while the United States and Europe have reached penetration levels in the low double digits. Many emerging markets remain below these levels. At first glance, this gap can appear to be a sign of slower adoption.
We see the opposite.
Several emerging economies are already demonstrating4 that electrification can progress rapidly when economics align:
The underlying drivers are structural:
These markets are not replicating the developed-world path to electrification. In many cases, they are leapfrogging directly toward new mobility models tailored to local realities.
For investors, the implication is straightforward: much of the future growth in electric mobility is expected to occur in emerging markets.
A common misconception is that electric mobility adoption in emerging markets depends primarily on environmental considerations.
Our experience suggests otherwise. The strongest adoption driver is compelling economics. Electric vehicles benefit from:
These benefits are particularly powerful in high-utilization segments such as commercial motorcycles, three-wheelers, ride-hailing fleets and logistics vehicles. Fuel and maintenance savings accumulate more rapidly in these applications, bringing total cost of ownership to parity earlier and improving daily earnings for operators. When the economics are compelling, adoption follows.
The climate case is equally strong.
Emerging markets account for the vast majority of the world’s population and are expected to represent an even larger share by mid-century6.
Electrifying high-utilization transport assets in these dense, fast-growing markets can therefore generate substantial emissions reductions relative to capital deployed.
BNEF estimates that road electrification and fuel-efficiency improvements displaced approximately 3.2 million barrels per day of oil demand in 2025, rising to nearly 26 million barrels per day by 2040 under its Economic Transition Scenario7.
Beyond its climate benefits, EV deployment can improve local air quality by reducing tailpipe emissions, with positive health outcomes for local populations8.
Economic and impact outcomes therefore reinforce each other: the models that improve driver economics often generate the strongest environmental impact.
The challenge is not proving the value proposition. It is scaling it.
The largest investment opportunities in electric mobility are often not located within the vehicle itself.
As EV ecosystems mature, vehicle manufacturing tends to become increasingly competitive and commoditized. Durable value instead accrues to the infrastructure and energy layers that underpin vehicle operation.
Our investment experience suggests three areas deserve particular attention:
Batteries
Batteries are often the largest and most strategically important asset within electric-mobility ecosystems.
They represent an important share of the EV’s CapEx. Optimizing battery life is critical to extending the asset's value creation period.
Additionally, batteries can be leveraged to create recurring interactions with users while generating valuable operational data and visibility over asset performance.
Battery platforms can also optimize utilization, replacement cycles and residual value, creating lasting advantages that become stronger with scale.
Charging and battery-swapping infrastructure
Infrastructure determines whether electric mobility remains a product or becomes a scalable service. Companies controlling charging or battery-swapping networks influence utilization rates, customer experience and operational reliability – ultimately creating value.
Infrastructure ownership can also create barriers to entry and enable higher asset productivity over time.
Mobility and energy services
Recurring service revenues often offer more attractive economics than one-time vehicle sales, both for businesses and investors.
Models such as battery-as-a-service, charging-as-a-service, subscriptions, fleet energy management, leasing and rental platforms align revenues directly with usage and provide greater predictability than traditional asset sales.
For investors, this visibility matters: recurring revenues can improve cash flow predictability, support better asset financing and make growth easier to underwrite.
For the business, regular customer interactions create a continuous feedback loop, helping refine the value proposition, strengthen retention and build relationships that become more valuable over the life of the vehicle.
Across markets, technologies and business models, one principle repeatedly emerges: interoperability matters.
Interoperability allows vehicles, batteries, charging systems and operators to work across different networks and providers. Its benefits extend far beyond technical convenience. Interoperable systems:
By contrast, fragmented ecosystems frequently suffer from underutilized infrastructure, duplicated investment and slower customer adoption.
There are legitimate trade-offs. Proprietary systems can offer tighter control and differentiated user experiences. However, excessive fragmentation can ultimately limit scale.
From an investor perspective, interoperability is often a useful indicator of market maturity and long-term scalability. Business models designed to participate in larger ecosystems generally benefit from stronger network effects and more efficient capital deployment.
Technology risk has fallen sharply over the last decade. Demand continues to grow. The remaining challenge is deploying capital effectively.
Electric mobility in emerging markets often requires business models that do not fit traditional financing frameworks. Infrastructure must be built ahead of demand. Battery assets require dedicated financing structures. Operators need capital solutions tailored to local market realities (e.g. blended finance, local currency instruments, etc.).
As a result, the constraint is increasingly financial rather than technological.
The scale of the funding opportunity is significant. BNEF estimates that more than $635 billion must be invested globally between 2025 and 2040 to build out EV charging networks. A further $800 billion of grid investment will be required to accommodate electric vehicles over the same horizon9. Scaling deployment therefore requires a holistic investment approach—supporting vehicles, batteries and charging infrastructure while also strengthening, modernizing and adapting the grid.
Yet capital remains concentrated in China, Europe and North America. In emerging markets, where adoption is accelerating as EV economics improve, the principal constraint is increasingly the availability of appropriately structured capital across this interconnected ecosystem.
Investors capable of providing scalable and flexible capital in emerging markets are needed to support bankable business models and unlock long-term value.
Electric mobility should not be viewed solely as a vehicle transition. It is an infrastructure transition, an energy transition and a capital-allocation opportunity.
The first wave of EV adoption validated the technology. The next wave will determine where value accrues.
With over 13 years of experience in clean energy investments, Mirova has developed a unique perspective on the financing needs of businesses in emerging economies.
Our experience suggests four conclusions:
Execution risks remain material. Business-model viability depends on high asset utilization, reliable electricity supply, disciplined battery management and access to appropriately structured capital. Currency volatility, regulatory change and residual-value uncertainty can also affect returns. These risks reinforce the importance of market selection, operational expertise and financing discipline.
For investors, the opportunity lies in supporting the platforms that solve the sector’s real scaling constraints: infrastructure, financing, utilization and customer access.
That is where we believe the next generation of value creation in electric mobility will emerge.
1. Sources: IEA Global EV Outlook 2026; BNEF Electric Vehicle Outlook 2026. 2. UNCTAD estimate. 3–4. IEA/BNEF EV Outlooks 2026. 5. ICE: internal combustion engine. 6. UNCTAD. 7. BNEF Electric Vehicle Outlook 2026. 8. WHO, Transport and Air Pollution (2025). 9. BNEF EVO 2026; IEA Global EV Outlook 2025. 10. Mirova, 30/06/2026.
The mentioned perspectives reflect the opinion of MIROVA at the date of this document and are subject to change without notice. Document for professional investors only.
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