An increase in Electric Vehicle Adoption is key to achieve the EU climate goals. But the percentage of Electric Vehicles (EVs) in the European fleet is still very low. Political incentives like Subsidies and CO2 pricing are used in most European countries to support EV adoption. This thesis discusses EV demand in an economic context, influence factors on EV demand and why a purchase subsidy and CO2 pricing are reasonable from an economic perspective. The empirical analysis of this thesis focusses on Germany and Sweden. In an Ordinary Least Square Model (OLA) five variables of interest are analyzed. The conclusion is that an increase in charging stations in Germany and Sweden has a positive effect on EV adoption. In Sweden the purchase bonus has a positive impact on newly registered EVs. Forecasting with the help of Impulse Response Functions based on the Vector Autoregressive (VAR) Model is applied in the second part of the empirical analysis. The results show that a positive price shock to electricity price has a negative effect on newly registered EVs in both countries, this is a new result as this kind of analysis has not been applied on this issue. The results of this thesis shows that several policy measures are beneficial for EV demand and should be implemented.