The ongoing military conflict involving Iran is becoming a key factor in the accelerated transition of the global automotive industry to battery electric vehicles (BEVs). According to a report from Bank of America, the escalation in the Middle East and the threat of supply disruptions are radically changing the economics of vehicle ownership.

BofA analysts emphasize that the level of uncertainty remains high. Scenarios range from a swift ceasefire to a prolonged blockade of the Strait of Hormuz in the second half of 2026. In the event of a severe scenario involving damage to regional energy infrastructure, Brent crude prices could soar to $160–240 per barrel.

Such a spike in fuel prices would deal a crushing blow to internal combustion engine (ICE) vehicles. The inflation of operating costs makes electric vehicles the only viable choice in terms of total cost of ownership (TCO). According to the bank's calculations, the five-year savings from using an electric Volkswagen ID.3 compared to a gasoline-powered Volkswagen Golf in Europe already range from €2,500 to €8,500, depending on available subsidies.

BofA notes that the current shift in consumer preferences mirrors historical patterns seen during past oil shocks when buyers flocked to fuel-efficient vehicles. The main beneficiaries of the current crisis will be EV segment leaders such as Tesla Inc. and Chinese manufacturers. Next in line are traditional brands with a strong range of economical cars, including Renault SA, BMW AG, and Toyota Motor Corp.

In the short term, the financial impact on automakers will be limited. Most companies have active mechanisms for hedging commodity and electricity prices, and their supply chains have not yet been affected. The share of the Middle Eastern market in global sales is less than 1%, although luxury segment manufacturers such as Ferrari NV and Lamborghini have already suspended shipments to the region.

However, Bank of America warns that as current commodity hedges expire, a prolonged conflict could lead to uncontrollable cost inflation. Combined with a general weakening of consumer demand amid high oil prices, this makes geopolitical volatility the main long-term risk for the global automotive industry.