Electric Vehicle (EV) Market Worth US$ 2000+ Billion by 2027, Growing at a CAGR of 40.7% From 2020 to 2027 Exclusive Report by Precedence Research.
The global electric vehicle market volume was 2,265.5 thousand units in 2019 and the market size is projected to reach more than 2000 Billion by the end of 2027 registering a CAGR of 40.7% from 2020 to 2027.
Electric vehicle is an electrically powered vehicle that uses traction motor or electric motor for propulsion. They have shown attractive growth over the past decade and their adoption rate is still prospering in double digit growth. On the basis of product they are categorized into Battery Electric Vehicle (BEV) and Plug-in Hybrid Electric Vehicle (PHEV). Presently, BEV dominated the sale of electric vehicles across globe. However, PHEVs are anticipated to flourish significantly over the coming years. The growth of PHEV is attributed to its benefits over BEV and driver-friendly features. Some of the attractive features of PHEV are extended driving range due to presence of liquid fuel tank & internal combustion engine, low battery cost and size, and charging flexibility at any gas station.
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Key Companies & Market Share Insights
The global electric vehicle market is consolidated with high competition owing to presence of large number of market players. The existing players are significantly focused towards innovation and development of new models and technology to overcome the drawbacks and strengthening their roots in the global market. Some of the market players are also investing in EV startups to boost their regional presence. In December 2019, an electric vehicle startup, Rivian, raised USD 1.3 billion fund from Amazon.com Inc. and U.S. based automaker Ford Motor Co.
Furthermore, rising initiatives from governments of several regions towards environmental depletion from CO2 emission has forced the automakers to switch towards battery-powered or electric vehicles. Merger, acquisition, partnership, and joint venture are the strategies adopted by the companies to retain their market position. For instance, in March 2019, Alternet Systems, Inc. announced its merger and acquisition pipeline for the expansion of electric vehicle technology innovation and its production capacity.
Some of the prominent players in the electric vehicle market include Tesla Inc., BYD Company Ltd., Ford Motor Company, Daimler AG, General Motors Company, Mitsubishi Motor Corporation, Groupe Renault, Nissan Motor Company, Toyota Motor Corporation, and Volkswagen Group, among others.
EV Industry Highlights
- Asia Pacific was the dominant region in 2019 and expected to be the most attractive market during the forecast period. China, India, Indonesia, and Korea are some of the most lucrative regions for the electric vehicle growth. Rising investments and government initiatives are the major factors for its significant growth.
- North America and Europe are the significant revenue contributors in the global electric vehicle market with considerable growth. Rising environmental concern and heavy incentives offered by the government have increased the adoption of electric vehicles massively in these regions.
- Battery Electric Vehicles (BEV) led the product segment with approximately 65% of the global market share. However, Plug-in Hybrid Electric Vehicles (PHEVs) are considered to register fastest growth during forecast period owing to being driver-friendly coupled with several benefits over the BEV.
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.
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.
The Impact of COVID-19 on the Electric Car Market
The outbreak of COVID-19 slowed down vehicle sales in 2020, including electric cars. The adoption of electric cars in the U.S. had fallen in the first & second quarters of 2020, while a slight growth was witnessed post the second quarter. Consumer behavior has changed significantly since the pandemic. People reduced the use of shared mobility services, and the total miles driven also decreased in 2020 due to remote working arrangements in most industries. The electric cars market in Asia-Pacific was moderately affected. Developing countries witnessed a sharp decline in their economy due to low consumer demands and increased prices for essential commodities, which directly affected the adoption of electric cars in these countries. The high cost of electric cars also remained a restraining factor for the market's growth in these countries.
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