Royal Dutch Shell expects electricity-powered vehicles to account for as much as 40 percent of the worldwide car market by 2050, Chief Executive Peter Voser said on Thursday.
Voser, speaking at The Wall Street Journal's ECO:nomics conference in Santa Barbara, said technological improvements and increases in the cost of producing gasoline will give a boost to vehicles that run on alternative power.
"We think between now and 2050, we will go from 1 billion cars to 2 billion cars worldwide," he said. "We think by 2050, roughly 40 percent of those 2 billion cars will be electric."
In the next 40 years, the market needs low-carbon fuels, more efficient engines and hybrid vehicles, Voser said.
"I think there will be room and space to develop all of them," he added.
Gasoline demand in developed countries like the United States has started to decline, partly as vehicles running on alternative fuels have entered the market. Companies such as Shell and BP are spending more money on those newer technologies, including for next-generation biofuels.
Automakers such as Ford Motor Co and Nissan Motor Co Ltd are racing to launch electric cars, betting these will be the environmentally friendly transportation of the future. Small players like Tesla Motors already sell electric vehicles.
Voser said Shell was investing 25 percent of its research and development budget into renewables, including wind power and biofuels.
Shell has bet big on ethanol by striking a deal with Brazil's Cosan to create a $21 billion a year ethanol joint venture.
The 50-50 joint venture, with almost 4,500 filling stations nationwide, will better position Cosan and Shell to compete with the two top players in the market, state oil giant Petrobras and Ipiranga, a unit of Brazil's Grupo Ultra
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