Vehicle Electrification Market is Estimated to Witness High Growth...

Vehicle Electrification Market is Estimated to Witness High Growth Owing to Rising Government Support for Adoption of Electric Vehicles

Posted 2024-02-02 12:57:24

Vehicle electrification involves partial or full electrification of vehicles by equipping them with electric motors, battery packs, and associated control systems. EVs incorporate interior and exterior lighting, infotainment systems, HVAC systems, and safety components that need electricity to function. Battery electric vehicles and plug-in hybrid electric vehicles are part of the vehicle electrification trend where the primary source of power for the vehicle is electricity. Vehicle electrification helps reduce emissions and reliance on petroleum fuels.

The global vehicle electrification market is estimated to be valued at US$ 97.25 Mn in 2024 and is expected to exhibit a CAGR of 5.9% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.

Market Dynamics:
Rising government support for adoption of electric vehicles is a key driver fueling growth of the vehicle electrification market. Many governments across the world offer purchase incentives and tax rebates for electric vehicles to encourage individual consumers and fleet owners to switch from conventional fuel vehicles to electric alternatives. For instance, the Indian government provides an income tax deduction of Rs. 1.5 lakh on the interest paid on loans taken to purchase electric vehicles. Such favorable policies help boost electric vehicle sales and raise demand for components used in vehicle electrification. Another driver is increasing investments by automotive OEMs in development of electric powertrains and electrified vehicle models. Major automakers are extensively investing in R&D activities focused on electric drivetrains, batteries, and other electric components to launch new EV models and transition their fleets to electric. This is positively impacting expansion of the vehicle electrification market.

SWOT Analysis
Strength: The vehicle electrification market has high growth potential due to stringent emission norms. Increased focus on developing electric vehicles by automakers is driving demand. Technological advancements are enabling enhanced performance of electric vehicles.
Weakness: High manufacturing costs of electric vehicles restrict mass adoption. Lack of standardization in charging infrastructure poses range anxiety issues among consumers.
Opportunity: Growing investment by governments to develop charging infrastructure will boost market revenues. Expanding applications of electric vehicles in commercial fleets present new opportunities.
Threats: Rising raw material prices may increase production costs. Slow electrification of public transport in developing nations hampers market growth.

Key Takeaways

The Global Vehicle Electrification Market Demand is expected to witness high growth. Demand is expected to rise significantly over the forecast period driven by stringent emission regulations. Automakers are investing heavily in developing affordable electric vehicles. Governments across regions are promoting electric vehicles through subsidies and tax rebates. This is likely to boost adoption rates. The global vehicle electrification market is estimated to be valued at US$ 97.25 Mn in 2024 and is expected to exhibit a CAGR of 5.9% over the forecast period 2024 to 2031.

Regional analysis related content comprises: The Asia Pacific region dominates the vehicle electrification market and the trend is likely to continue. China is the largest producer and consumer of electric vehicles globally. Presence of leading automakers and growing investments by regional governments are driving the APAC market. For instance, the South Korean government announced a planned investment of $45 billion by 2030 to support development of relevant infrastructure and technologies.

Key players related content comprises: Key players operating in the vehicle electrification market are AMETEK Inc., Alleima, Teshima International Corporation, Om Steel Tubes Ltd., Tech Tube, Inc., Bison Stainless Tube, LLC, Vita Needle Company, M&M International, Fuji Seiko, Accu-Tube, Eagle Stainless Tube & Fabrication, Inc., Forefront Medical Technologies, Minitubes, Teleflex Incorporated, VIANT, and K-Tube Technologies. These companies are focusing on new product launches and collaborations to gain footholds and expand their global presence.