Electric Vehicle Market to rising 40.7 percent till 2027

Amid the COVID-19 crisis, the global market for electric vehicles is projected to reach a revised size of US$ 2000+ Billion by 2027, growing at a CAGR of 40.7% from 2020-2027. 

The global electric vehicle market has taken a huge leap forward in the past decade. But even though we've already seen some incredible growth in the number of EVs worldwide, industry predictions would suggest that we've only just scratched the surface. Read More@ https://www.precedenceresearch.com/electric-vehicle-market

Global Electric Car Market Size

Amid the COVID-19 crisis, the global market for electric vehicles is projected to reach a revised size of US$ 2000+ Billion by 2027, growing at a CAGR of 40.7% over the analysis period 2020-2027. 

In absolute terms, China remained the world's largest EV market, with 2.3 million electric vehicles in active use. To put that into perspective, that's nearly half (45%) of the global stock of EVs. Europe and the US are relatively far behind with 1.2 and 1.1 million EVs respectively.

But when it comes to relative terms, the situation in Europe is looking a lot more positive. While only 5.2% of China's vehicles are electric, Norway has  56% of its vehicles running on electricity in 2019.

The runners-up Iceland and Netherlands have reached 25.5% and 15% EV penetration, respectively.

Historical Data of The Global Ev Market

In 2019, the number of light electric vehicles globally reached 2,265.5 units, 9 % higher than for 2018. This is a clear deviation from the growth rates of the previous 6 years, which were between 46% and 69%.

The reasons for this shift are due to the decrease in sales in the second half of 2019 in the two largest markets, China and the USA.

But even with the stagnant growth in the two largest markets, global EV sales still grew, largely in part to Europe, which saw 44% growth. This could be attributed to the introduction of WLTP, along with changes in national vehicle taxation and grants.

In 2019, Europe secured €60 billion in investments to produce EVs and batteries - 19 times more than in 2018. Driven by EU car CO2 targets, industry and governments committed 3.5 times more to EV and battery production in Europe than they did in China.

The industry geared up to meet the 95 gCO2/km targets for 2020/2021. In 2019, over 30 new and improved BEV/PHEV models were introduced, which will push EV sales in this year and the next.

Amid COVID-19, the outlook for 2020 global EV sales becomes more difficult. The preliminary EV sales data for January and February is very positive in Europe, encouraging in the USA, but dismal in China, where the total vehicle market was down 80% in February. If quarantines and factory closures continue into Q2, insufficient parts supply affects the global car industry for a longer period.

While the direction is right, it's good to keep in mind that as of 2019, only 2.5% of the world's passenger vehicles run on electricity. This would suggest that we still have a long road ahead until we can declare electrification a reality.

The Environmental Impact Of Evs

Altogether EVs consumed approximately 80 terawatt-hours of electricity in 2019, a large proportion of which can be attributed to two-wheelers in China. Overall, China accounts for 80% of the world electricity demand for EVs.

Fun fact: 80 terawatt-hours is somewhat comparable to the electricity demand of Finland in 2019.

During the year, EVs emitted 38 million tonnes of carbon-dioxide equivalent on a well-to-wheel basis. Compare that to the 78 million tonnes an equivalent ICE fleet would have emitted. In practice, all emissions from EVs are born as a result of the manufacturing process, whereas a similar logic can't be applied to ICE cars. In the grand scheme of things, it seems safe to conclude that the public debate over EVs vs. ICE cars environmental impact is slowly turning in the favor of EVs.

While it's true that EVs increase electricity consumption, that can become the saving grace of energy utilities in the future. By the 2040s, electric vehicles will add up to over 30 TWh of installed battery storage capacity. For utilities, this means that EVs offer cheap energy storage, win no capital cost and relatively low operating costs.

Growth Factors

Even though the oil prices have declined prominently, electric vehicles adoption is increasing day by day. Rising environmental concern for pollution and CO2 emission, favorable government policies for adoption of electric vehicles, and significant investment by EV manufacturers are some of the major factors driving the global electric vehicle market. Some of the manufacturers are also promoting workplace and residential charging stations to over the charging constraints. For instance, in December 2017, Electrify America LLC announced to install more than 2,800 residential and workplace charging stations by June 2019 in 17 different metropolitan cities of U.S.

However, lack of global standard for the charging infrastructure is one of the major reasons that hinder the market growth. Nonetheless, technological advancement in electric vehicle charging stations powered by renewable energy open up new opportunities in the market growth.

Regional Insight

Asia Pacific seeks the most lucrative growth over the forecast period owing to rising adoption of electric and zero-emission vehicles in the region. The government of various Asian countries has issued stringent regulations for the CO2 and greenhouse gas (GHG) emission. This has forced the auto-manufacturers to move their production towards more efficient and environment-friendly vehicles. In June 2019, Japan had issued a new CO2 emission standard for 2030, according to this car manufacturing must focus in reducing the CO2 emission by 32% by 2030 in comparison to 2016. Other countries are also taking significant initiative for controlling the vehicle emission. For instance, in 2020, China made huge investment in electric car infrastructure to promote e-mobility. Volkswagen AG, one of the leading electric vehicle manufacturers has signed a joint venture with China and planned to invest USD 11.30 Bn for industrialization of e-mobility in China.

Europe and North America are the prominent electric vehicles market with around 45% combined revenue share globally. Europe after Asia Pacific is the second most lucrative EV market owing to various governments plan for zero emission on-road fleet by 2030. In June 2020, the government of Germany announced to double the subsidies on electric vehicles. The initiative has taken to promote electric vehicle sales and restrict diesel vehicle sales. Similarly, in July 2016, the U.S. government planned to accelerate electric vehicle adoption by announcing some private sector and federal actions such as launch of FAST act process and loan guarantees up to USD 4.5 Bn for the deployment of electric vehicle charging station.

Key Players & Strategies

The global electric vehicle market is consolidated and highly competitive owing to the presence of large number of players. Market players are significantly involved in merger, acquisition, partnership, regional expansion and other marketing strategies to retain their position in the global market. For instance, in March 2020, Nikola Corporation, a zero-emission truck startup announced its merger with VectoIQ, dedicated for the development of mobility as a service and autonomous fleet.

Some of the key players of the market are BYD Company Ltd., Ford Motor Company, Daimler AG, General Motors Company, Mitsubishi Motor Corporation, Groupe Renault, Nissan Motor Company, Toyota Motor Corporation, Tesla Inc., and Volkswagen Group, among others.

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