The global electric vehicles market is expected to reach USD $ 1,323.0 Bn by 2027, with a growing CAGR of 34.1% during the forecast period (2021-2027).
Energy sources are the backbone of a country’s economy. The conventional source of energy such as coal, crude oil etc are depleting very fasts and users cannot rely on these sources to meet the future demand. Therefore, there is an immense demand to find new sources of energy as a fuel for transportation and with the advent of technology to keep up with the pace of ever-increasing demand for fuel.
An electric vehicle (EV) operates on electricity stored in a rechargeable battery, rather than on an ICE (Internal Combustion Engine) which generates power by burning fuels. The different types of batteries used in the vehicles include lithium-ion, molten salt, zinc-air, and various nickel-based designs. Electric vehicles are primarily designed to replace conventional transportation vehicles to avoid emission of harmful gases into the surrounding environment. Therefore, the electric vehicle is seen as a possible replacement for current-generation automobiles.
The supportive government initiatives are expected to drive the market growth to a great extent. For instance, the National Electric Mobility Mission Plan (NEMMP) introduced by Indian Government published in 2020 is a National Mission document that offers the vision and roadmap for the faster adoption of electric vehicles as well as their manufacturing. Under this plan the government has endorsed Phase-II of the FAME Scheme with an expense of US$ 1.3 bn for a time of 3 years beginning from first April 2019. Out of complete budgetary help, around 86% of the asset has been allotted for demand incentive in order to drive interest for EVs. This stage intends to create demand for electric vehicles by supporting 7000 e-Buses, 5 lakh e-3 Wheelers, 55000 e-4 Wheeler Passenger Cars (counting Strong Hybrid), and 10 lakh e-2 Wheelers.
In addition, the decreasing price of the batteries coupled with technological advancements such as emergence of SSB (Solid-state batteries) could lead to EV with significantly longer ranges and which support faster charging. For instance, In Jan 2021, StoreDot, the pioneer of extreme fast charging (XFC) battery technology announced the availability of its first-generation 5-minute charge battery engineering samples. Therefore, this development will accelerate the growth of the market over the forecast period. Battery electric vehicles significantly incorporate autonomous delivery vehicles, industrial vehicles, and public transport vehicles.
However, the cost and range limitations related to EV batteries are a significant restraining factor for the entire transition to electric mobility. Its capacity determines the value of an electric vehicle battery in kilowatt-hours (kWh), which dictates its range and therefore the power level of the motor that it supplies. Technological advancements have brought down the value of EVs. EV battery manufacturers are focusing on providing high-capacity batteries and reducing battery prices to make sure the overall cost of a vehicle falls under the subsidized range. Government regulations to terminate fossil fuel-powered vehicles, increasing concerns raised over conventional vehicles' environmental impact, improvement in battery capacity, and supporting government policies and regulations are promoting the market growth.
By Vehicle Class
By Vehicle Type
The battery-electric vehicles segment is projected to grow at a substantial growth rate during the forecast period. This growth is attributable to increased battery efficiency and decreased cost of the battery. For instance, according to a report published by the International Energy Agency (IEA) in2020, the sales of weighted battery pack costs in 2019 were around USD 156 each kilowatt-hour, down from more than USD 1,100/kWh in 2010.
The commercial vehicle segment is projected to grow at the highest CAGR during the forecast period. The growth in this segment is attributed to the increase in the fuel prices for conventional commercial vehicles, stringent regulations by governments, and rising demand for commercial vehicles such as buses and trucks for better connectivity. Moreover, increasing disposable income as well penetration of the e-commerce industry in the developing economy are the major factors to fuel the growth of these segments. For instance, In September 2019, Amazon an e-commerce company ordered 100,000 BEV light-commercial vehicles from start-up company Rivian. Amazon aims to be net-zero emissions by 2040.
The Asia-Pacific Electric Vehicles market is led by countries such as China, Japan, and South Korea. China is the world’s largest producer of Electric Vehicles and relevant technologies. The supportive initiatives by government including subsidies for buyers, support to install the charging station, and regulations against excessive polluting vehicles have boosted the sales of EVs in China. According to the report published by the International Energy Agency (IEA) in 2021, China led the global Electric Vehicles market with a reported fleet of 4.5 million EVs, followed by Europe for which the annual fleet for EV was noted to be around 3.2 million units.
Europe Electric Vehicles market size is anticipated to grow at a significant rate and have the second largest market share of Electric Vehicles. The growth in the region is attributed to European Union’s CO2 emission standards and subsidy schemes offered by the governments. For instance, the federal government has supported the adoption of Electric Vehicles with a financial subsidy of up to €3,000, as well as an exemption from the annual circulation tax for BEVs and fuel cell vehicles, and tax benefits for electric company cars. As a response to COVID-19, the government extended the bonus through 2025, with the bonus doubled until the end of 2021. In Europe, BEV registrations accounted for 54% of electric car registrations in 2020 and while the number of registrations for plug-in hybrid vehicles are anticipated to witness increase in coming years.
Leading Players of Electric Vehicles Market:
The major players operating in the global electric vehicles market are Tesla, BMW Group, Nissan Motor Corporation, TOYOTA MOTOR CORPORATION, Volkswagen AG, General Motors, Daimler AG, Energica Motor Company S.p.A., BYD Motors Inc., and Ford Motor Company among others.
The pandemic has negatively affected a few sectors, including the automobile, with significant producers closing their plants totally or working at decreased limits following the orders given by their respective governments. For instance, according to the Society of Indian Automobile Manufacturers, the COVID-19 wave has impacted the sales of vehicles in the month of April 2021. Sales of Passenger vehicles fell by about (-) 10.07 %, compared to March 2021, due to various restrictions in States which have been experiencing surge in COVID-19 cases. Sales of Two-Wheelers have also plummeted by (-) 33.52 %, while Three-Wheelers witnessed de-growth of (-) 57.01 %, from March 2021 to April 2021. Vulnerability concerning the length of the lockdown and inventory network interruptions made it harder for players to expect the business' recuperation. This emergency caused underlying movements that had critical ramifications available.
In 2019, the worldwide sales of electric vehicles had crossed 2 million. Nonetheless, the COVID-19 emergency prompted upset stockpile chains, restricted tasks, and labour force, and industrial facility terminations. This caused an extreme decrease in vehicle deals, particularly in the portion of the electric vehicle. Be that as it may, the electric vehicles market is required to recuperate rapidly because of China's solid development.
The Electric Vehicles market analysis report covers impact of COVID19 on the demand and supply of Electric Vehicles in detail along with the growth opportunities and revival period.
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Market Overview & Competitive Landscape
Market Segmentation (Market Size and Share Analysis)
COVID – 19 Opportunity Mapping
Regional Market Analysis