Electric Vehicle Market 2020 and Forecast 2021-2027

                                          
Report Overview: Electric Vehicle Market


The global electric vehicle market demand was estimated at 1,262.4 thousand units in 2019 and is expected to witness a CAGR of 30.4% 2020 to 2027. The market is driven by initiatives taken by governments of various countries to promote the manufacturing of electric vehicles (EVs). For instance, in 2019, the government of Germany and auto manufacturers agreed to raise cash incentives under the Environment Bonus plan for battery powered cars. The incentives will reach USD 6,680 per vehicle and the auto industry to cover half the cost. Additionally, the government plans to implement these incentives by 2025. Similarly, in 2019, the government of India announced its plans to spend USD 1.4 billion to subsidize sales of hybrid and electric vehicles until 2022. The incentives are applicable only on vehicles that cost less than USD 21,177, thereby resulting in increased demand for EVs from 2020 to 2027.

Stringent vehicle emissions regulations have led to the rise in demand for electric vehicles. For instance, the European Union set itself a target of net-zero greenhouse gas emissions by 2050. Electric vehicles produce lower emissions as compared to conventional vehicles. This has led governments around the world to increase awareness and promote the adoption of EVs to reduce oil consumption, air pollution, and related emissions. Some of the most comprehensive promotions are done in the Netherlands and Norway. Thus, the market will grow at a notable rate during the forecast period.

Rising investments in electric vehicles is considered a major driver for the market. Companies such as Daimler AG, Ford Motor Company, and Groupe Renault are investing heavily in their plan to manufacture EVs. In December 2018, Daimler AG announced investments worth USD 20.0 billion in the purchase of battery cells for electric vehicles. The company aims to electrify its Mercedes Benz portfolio until 2022 with around 130 EVs. Similarly, Ford Motor Company announced its plans to invest USD 11.0 billion to manufacture 40 electric vehicles by 2022. Thus, the market is anticipated to rise over the forecast timeframe.

Lack of charging infrastructure is expected to hinder electric vehicle market growth over the estimated period. Variations in charging load and lack of standardization are major drawbacks for the market. Different countries have their own standards such as CCS (Europe, the U.S., and Korea), CHAdeMO (Japan), and GB/T (China). Some electric manufacturers such as Tesla, Inc., are focusing on overcoming this obstacle by having their own charging network. Thus, market players are planning to overcome these challenges and expand their business.

Increasing adoption of electric vehicles in the commercial and government sectors is anticipated to drive the market. In 2020, the Department for Transport in U.K. allocated around USD 65 million for all electric bus towns. The transport department estimated that 200 electric buses can save around 7,400 tons of CO2 annually, which is considered to play a integral part in bringing down emissions. Furthermore, in 2020, Uber announced its partnership with Nissan wherein the auto-manufacturer will make 2,000 EVs for Uber drivers in London. The partnership was done with Ubers aim to make all its vehicles emission free by 2025. Thus, the market is anticipated to rise over the coming years.

Product Insights: Electric Vehicle Market

The product segment is bifurcated into Battery Electric Vehicles (BEV) and Plug-in Hybrid Electric Vehicles (PHEV). In 2019, the PHEV segment held the market share exceeding 30.0% in terms of revenue. Furthermore, the BEV segment is expected to witness a CAGR of over 14.9% in terms of revenue during the forecast timeframe. This is attributed to the increasing environmental awareness and benefits of BEV among people.

Meanwhile, the PHEV segment is projected to register the highest CAGR of over 34.0% in terms of revenue during the forecast timeframe. This upsurge is due to the initiatives taken by the government of developing countries such as India and China to promote the usage of electric vehicles. Furthermore, companies such as Volkswagen Group are focusing on increasing its plug-in electric car sales. In January 2020, the company announced an increase of about 60.0% in its plug-in electric car sales as compared to 2018.

Regional Insights: Electric Vehicle Market

In 2019, North America held a substantial market share of over 15.0% in terms of revenue. This share is attributed to the increasing demand for electric vehicles in U.S. Furthermore, new initiatives are being taken up by automotive manufacturers, policymakers, non-profit organizations, and charging network companies and have launched a new non-profit organization named Veloz. This new organization aims at attracting investments, innovation, marketing, and growth of electric vehicles in North America. Additionally, in 2018, Electrify America, a company launched to promote EV adoption, announced its plans to invest USD 200.0 million for California. Thus, the demand for electric vehicles is North America is bound to rise over the forecast period 2021-2027.

Asia Pacific is projected to emerge as one of the most lucrative regions in terms of revenue during the forecast timeframe. This upsurge is attributed to the growing demand for electric cars in China, Japan, and India. In 2018, about 45.0% of the electric cars on road were in China as compared to 39.0% in 2017. Furthermore, various companies are focusing on manufacturing electric vehicles in China. For instance, in 2018, Volkswagen Group announced its plan to manufacture 22 million EVs by 2026, half of which are to be manufactured in China. Similarly, Tesla, Inc. plans to manufacture around 150 thousand 3s Model cars in Shanghai, China. Additionally, in 2019, the government of India announced tax incentives on the purchase of electric vehicles. The government plans on deductions in income tax on the interest paid or loan taken for the purchase of electric vehicle.
Electric Vehicle Market Share Insights

The market is consolidated and characterized by high competition owing to the presence of major players such as Tesla, Inc.; Daimler AG; Volkswagen Group; Toyota Motor Corporation; and Groupe Renault. These companies are engaged in investing heavily to manufacture technologically advanced electric vehicles and enhance their product offerings. For instance, in November 2019, Volkswagen Group announced its plans to invest more than USD 4.0 billion in China in 2020. Around 40.0% of these investments are to be made in e-mobility.

Similarly, numerous organizations are engaged in acquisitions, mergers, regional expansion, and strategic partnerships to gain a competitive advantage in the market. For instance, in March 2019, Tesla, Inc. announced the acquisition of Maxwell Technologies, Inc. The acquisition was done with an aim to improve Teslas batteries and reduce the overall cost to gain a competitive advantage in the market. Furthermore, in November 2019, Toyota Motor Corporation and BYD Company Ltd. announced their plans to establish a joint venture for the research and development of BEV. According to the agreement, the new company will be established in China by 2020 and will work on the designing and development of BEVs and its related parts.

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Trusted Business Insights has segmented the global electric vehicle market report based on product and region:

Product Outlook (Volume, Thousand Units; Revenue, USD Billion, 2016 - 2027)

  
Battery Electric Vehicles (BEV)
  
Plug-in Hybrid Electric Vehicles (PHEV)