Electric Vehicle Charging Infrastructure Market Size to Reach USD 248.96 Bn by 2033
The global electric vehicle charging infrastructure market size was valued at USD 25.85 billion in 2023 and is estimated to reach USD 248.96 billion by 2033, growing at a CAGR of 25.42% between 2024 and 2033.
The electric vehicle (EV) charging infrastructure market is experiencing rapid growth and transformation, driven by the global shift towards sustainable transportation solutions. As the adoption of electric vehicles continues to escalate, the need for robust and accessible charging infrastructure becomes increasingly paramount. This overview provides insights into the current landscape, key trends, challenges, and opportunities shaping the electric vehicle charging infrastructure market.
The electric vehicle charging infrastructure market growth driven by an increase in the number of public and private sector efforts aimed at encouraging people to switch to electric vehicles. As a result, the need for electric vehicles charging infrastructure is likely to rise significantly. The demand for electric vehicles has risen in accordance with the growing awareness of environmental sustainability and strict emission restrictions imposed by numerous governments. While private firms focus on manufacturing novel electric vehicle chargers and building charging stations, governments are continuously striving with these companies to provide electric vehicle charging infrastructure. All these factors are boosting the demand for charging infrastructure in the market.
Surge in number of electric vehicles charging stations
The rapidly evolving electric vehicle market is propelling innovation in electric vehicle technology and infrastructure. Electric vehicles provide numerous benefits, including lower fuel consumption and emissions from vehicle engines, which boosts their global demand. This, in turn, is expected to increase the demand for electric vehicle charging infrastructure, fueling the market growth. The charging stations are being rapidly developed as part of government initiative programs, and electric vehicle manufacturers are collaborating on the development of charging stations in parking lots. To increase electric vehicle sales, electric vehicle manufacturers are focusing on the installation of charging stations for electric vehicles similar to petrol pumps. Thus, the surge in number of electric vehicles charging stations is propelling the growth of electric vehicle charging infrastructure market.
High maintenance costs
Electric vehicles are typically more expensive than gasoline vehicles. This is due to the additional components installed in these vehicles. Because some parts of these vehicles wear out faster than petrol vehicles due to a lack of lubrication in most of these vehicles, these vehicles require much more regular maintenance over time and thus cost more in the long run. Furthermore, the parts must be replaced on a regular basis, as opposed to petrol vehicles, which typically have a longer life for such parts. As a result, only people who drive a lot every month prefer electric vehicles. Also, as maintenance costs for electric vehicles are high, the cost for maintaining charging infrastructure is also high. It requires good amount of funds and time to maintain charging stations. Therefore, lots of capital is required for operation and maintenance of electric vehicle charging infrastructure. Thus, the high maintenance costs is restricting the growth of the electric vehicle infrastructure market.
Government initiatives for the growth of electric vehicle charging stations
The market for electric vehicle charging infrastructure is expected to expand over time as government bodies in various countries increase their support by various policies and subsidies. Many countries, including the U.S., the UK, and China, have recognized the need to switch to electric vehicles in order to reduce the increasing pollution caused by automobiles. These countries have taken initiatives to improve the charging network across their states to make it easier for people to switch to electric vehicles, and they have promoted this segment through incentives, tax breaks, and preferential policies. China, the U.S., and a few European countries have subsidized the installation of electric vehicle charging stations in residential complexes, semi-public areas, and private homes, among other places. Thus, the continuous government initiatives for the growth of electric vehicle charging stations are providing lucrative opportunities for the growth of electric vehicle charging infrastructure market.
Increase in demand for LPG and CNG vehicles
The factors such as rising demand for low-emission commuting and government subsidies and tax breaks for compressed natural gas (CNG) and liquified petroleum gas (LPG) vehicles have compelled manufacturers to provide CNG and LPG vehicles globally. Increased government investments in developing CNG and LPG infrastructure, as well as buyer incentives, will provide opportunities for original equipment manufacturers (OEMs) to diversify their revenue streams and geographical presence. Furthermore, as countries around the world have become more concerned about reducing emissions, the demand for low-emission fuel vehicles such as CNG and LPG vehicles is expected to rise. As a result, the increase in demand for LPG and CNG vehicles is expected to hinder the growth of electric vehicle infrastructure market.
The rapid charging sector dominated the market, constituting 73% of global revenue in 2023 and is projected to experience the highest Compound Annual Growth Rate (CAGR) throughout the forecast period. This surge is primarily driven by governmental initiatives aimed at expediting the rollout of public rapid-charging infrastructure. Many entities have deployed Level 3 DC fast chargers or Level 2 AC charging stations capable of fully charging an electric vehicle within 30 minutes to 4 hours.
Additionally, automobile manufacturers are prioritizing the installation of electric vehicle charging stations for their staff as part of endeavors to raise awareness about their electric vehicle offerings and public charging infrastructure. For instance, General Motors Company's Detroit facility has seen a surge in demand for its Chevrolet Volt cars among employees following the installation of 100 Level 2 electric vehicle charging stations in parking lots.
In 2023, the "others" segment commanded the largest market share in terms of revenue. This segment encompasses connectors such as GB/T, Mennekes, J1772, and others. The dominance of this segment is chiefly attributed to the widespread adoption of GB/T connectors in China. The GB/T connector serves as the official EV plug standard in China, utilized by all EV chargers. The substantial sales of EVs coupled with the robust presence of EV charging infrastructure in China are expected to propel the growth of this segment. According to an analysis by Grand View Research, China boasted 7,082,307 EV chargers in 2022.
Meanwhile, the CCS connector segment is poised to register the swiftest Compound Annual Growth Rate (CAGR) during the forecast period, primarily due to the increased preference among major automobile manufacturers for adopting CCS connectors in their electric vehicles. For instance, in July 2019, Tesla announced the introduction of a CCS connector to support the Model 3, with anticipated future compatibility with the Model S and Model X in Europe.
In 2023, Level 2 charging took the lead in the market. This charging operates within the range of 208 to 240 volts, making it suitable for various locations such as homes, workplaces, and public charging stations. As of 2022, Level 2 charging infrastructure is widely adopted due to its ease of installation, making it the most prevalent level of charging for electric vehicles. Depending on the vehicle's maximum charge rate and the power output of the Level 2 charger, it can add anywhere from 12 to 80 miles of range per hour.
Level 3 charging is expected to experience the fastest Compound Annual Growth Rate (CAGR) during the forecast period due to its rapid-charging capabilities. Level 3 chargers, being the quickest charging option, can charge electric vehicles at a rate ranging from 3 to 20 miles per minute using direct current. The voltage used by Level 3 chargers is higher than that of Level 1 and Level 2 chargers, which is why they are not yet commonly installed in residential areas. However, as the number of EV users increases, companies and public spaces are expected to implement such charging infrastructure to meet the growing demand. This, in turn, is anticipated to drive the growth of the Level 3 charging segment during the forecast period.
In 2023, the commercial application segment emerged as the market leader. This segment is subdivided into fleet charging stations, destination charging stations, bus charging stations, highway charging stations, and other charging stations. The segment's dominant position is attributed to government initiatives and funding allocations, as well as efforts by automobile manufacturers to expand public Electric Vehicle Charging Infrastructure (EVCI). Additionally, establishing supportive infrastructure at public locations for EV charging is crucial, as relying solely on overnight or home charging would not suffice for long-distance travel.
The residential segment is expected to witness steady growth at a Compound Annual Growth Rate (CAGR) over the forecast period. This segment is further divided into private houses and apartments/societies. Vehicle charger manufacturers are now focusing on developing residential EV chargers to ensure greater availability and increased vehicle range. Original Equipment Manufacturers (OEMs) are collaborating with charging network operators, EV manufacturers, utility service providers, and corporations to deploy fast-charging stations, thus expanding their geographical presence and enabling cost-effective deployment of the EV charging network.
In 2023, Asia Pacific emerged as the dominant force in the market, capturing a substantial 68% revenue share. Countries like China, Japan, and South Korea, renowned as electric vehicle hubs, are making significant investments in charging infrastructure development. For instance, in January 2022, the Chinese Government unveiled plans to invest in EV infrastructure deployment, aiming to support 20 million EVs on the road by 2025.
Europe is poised for significant market growth as well. Several European nations have set ambitious targets for reducing carbon emissions and increasing electric vehicle adoption by 2020. For instance, in July 2018, the U.K. government passed the Automated and Electric Vehicles (AEV) Act, granting new powers to expedite EVCI development on motorways and fuel stations. Other European countries like France, Germany, Belgium, and the U.K. are also prioritizing the development of electric vehicle charging infrastructure to ensure interoperability across different EV models throughout the region, thus fostering growth in the Europe EV charging infrastructure market.
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