Vehicle Electrification Industry Overview
The global vehicle electrification market was valued at USD 82.91 billion in 2021 and is projected to register a compound annual growth rate (CAGR) of 9.7% from 2022 to 2030.
The market is expected to register significant growth owing to the automotive industry’s demand for alternatives to petroleum-based fuel and government initiatives for environmentally sustainable transportation options globally. The governments of various nations are launching green initiatives; various environmental agencies are setting aggressive targets for emission cuts, globally. At the same time, environmentally conscious consumers are increasingly adopting electric vehicles and contributing toward reducing their overall carbon footprint. As a result, the demand for vehicle electrification products is expected to increase during the forecast period. Furthermore, various advantages linked to electrification are improving the vehicle’s performance, putting in additional features to the vehicles, and providing benefits such as reduced vehicle weight, fewer emissions, higher fuel economy, enhanced driving comfort, and safety. All these factors are expected to propel the growth of the vehicle electrification market.
Gather more insights about the market drivers, restrains and growth of the Global Vehicle Electrification Market
The COVID-19 pandemic significantly impacted the automobile sector. Lockdowns and travel restrictions throughout the world resulted in the closure of factories affecting everything from supply chain and operations to capital investment, financing, and long-term strategy. The epidemic increased the pressure on vehicle electrification technology manufacturers to change their business models as the sector dealt with a financial downturn and an uncertain timescale.
Although the crisis has left a significant financial hole and hampered various new vehicle programs, including EVs, the automobile industry’s drive toward electrification remains strong. On the other hand, increased demand for cost-effective solutions and the growing trend of electrification of commercial vehicles and fleets are expected to provide lucrative opportunities for worldwide market advancement during the forecast period.
The greater inclination in recent years toward products has resulted in considerable demand for vehicle electrification and supporting infrastructure. An increase in the number of charging outlets coupled with financial incentives from the government is emerging as a crucial factor triggering the demand for electric vehicles. The lower operating costs of electric vehicles as compared to those of conventional ICE-operated vehicles are expected to drive the growth of the vehicle electrification market.
Growing consumer demand for fuel-efficient vehicles has resulted in considerable demand for vehicle electrification. However, electric vehicles are quite expensive, despite the various benefits. This is due to the high cost of batteries used in electric vehicles and the expense of charging the batteries. Product charging stations are still in the early stages of development. As a result, utilizing electric vehicles to go large distances is likely to cause issues along the way.
Moreover, electric vehicles are not feasible in cities with power shortages. The battery backup time of electric car batteries is likewise rather short. These limitations of electric vehicles are projected to hamper the vehicle electrification market. On the other hand, vehicle electrification’s replacement and maintenance costs are high. However, the rising fuel prices and the growing environmental concerns are also expected to drive the growth of the vehicle electrification market during the forecast period.
Browse through Grand View Research’s Automotive & Transportation Industry Research Reports.
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Key Companies profiled:
Some prominent players in the global vehicle electrification market include
- Robert Bosch GmbH
- Continental AG
- Denso Corporation
- Delphi Automotive PLC
- Johnson Electric
- Mitsubishi Electric Corporation
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