The global automotive battery powered propulsion systems market size is expected to witness significant growth over the next seven years. Rising electric vehicles (EV) demand along with increasing disposable income is expected to drive market growth over the forecast period.
Vehicular pollutants have an adverse impact on consumer health. Increasing consumer awareness regarding greenhouse effect and ozone layer depletion has raised concerns towards reducing harmful vehicular emissions. Health risks associated with these environmental conditions are expected to drive product demand over the forecast period. Battery powered propulsion systems also help to reduce fuel consumption.
Automobiles such as light duty vehicles are a major contributor to the regional economy. Electrification represents the key to sustainable mobility future with growing demand for battery propulsion systems. Shifting consumer affinity towards premium brands coupled with increasing acceptance for EVs is expected to steer automotive battery powered propulsion systems demand over the next seven years.
Technological innovations in the transportation sector include fuel-efficient cars and scooters that can minimize environmental pollution. Advancements in low emission technology minimize vehicular pollution and enhance automobile engine performance. Rising consumer awareness towards eco-friendly products and fuel economy is expected to drive electric vehicles demand over the forecast period.
Automobile manufacturers including Tesla, Audi, BMW, Toyota, and Suzuki have introduced hybrid vehicles, which operate both on batteries and IC engines. These companies have also developed a highly efficient battery powered with improved performance and power transmission. These initiatives along with advancements in engine propulsion technology and shifting consumer trends towards low emission vehicles is anticipated to positively impact automotive battery powered propulsion system market growth in the next few years.
Various governments such as the U.S., Japan, and China have imposed stringent emission standards to enhance their position as environment friendly regions. Regulatory concern to lower the greenhouse emissions is expected to necessitate requirements for sustainable alternatives such as battery powered propulsion system.
Favorable initiatives by various national governments in the form of tax exemptions and subsidies on low emission vehicle manufacturing or purchase are expected to steer industry growth. These initiatives are anticipated to bridge the existing demand-supply gap for EVs and hence escalate the battery powered population systems growth.
Increased consumer concern towards toxic and chronic effects of polluted air is expected to drive battery powered automobile market. Lithium ion battery finds significance in electric vehicles owing to its higher energy density and longer life span than conventional ones. High manufacturing costs and safety risks associated with this technology are expected to hamper market growth over the next seven years.
Factors such as low availability of recharge points influence long distance travel routine. Conventional cars can go up to 1000 km on a single fuel tank however battery powered cars need to be recharged after 150-200 km. Short driving range and high costs associated with EVs are expected to influence industry growth in the long term.
Developing affordable and efficient battery propulsion systems that maximize driving distance per unit resource is a major challenge for the market. Increasing R&D investments to develop batteries with sustainable life and compatible technology is one of the key strategies adopted by industry participants.
Rechargeable batteries used in EVs include lithium ion and nickel metal hydride type that offer longer usage over conventional ones. Ongoing investments by various automotive manufacturers to enhance battery capacity and minimize charging time are expected to drive R&D initiatives over the next seven years.
Production costs are associated with degree of hybridization deployed by the manufacturers. Battery powered propulsion system enhances fuel efficiency and performance of electric vehicles (EV). Benefits associated with environmental and fuel economy of EV are expected to steer product demand over the forecast period.
On the basis of applications, the global automotive battery powered propulsion system market has been segmented into plug-in (EV), hybrid electric vehicle (HEV), and on- & off-road EV. Diesel powered HEV utilizes energy recovery technology such as regenerative brakes that charge the battery system and maximize the life of braking system. It combines both the benefits of gasoline engines and electric vehicles. Plug-in and full HEVs are expected to dominate the market segment over the forecast period.
Governments of mature economies including France, Canada, and Japan offer subsidies to automobile manufacturers for designing low emission vehicles. Japan offers tax exemption and subsidies up to USD 1,100 on low emission vehicle purchases. Aforementioned factors are expected to steer investments in the LEV transportation sector over the long term.
Growing clean fuel passenger vehicle industry in Germany, France, and the U.S. is expected to drive product demand over the forecast period. Asia Pacific is estimated to emerge as the fastest growing market for vehicle electrification. This can be attributed to the rising rate of utilization in Japan and China. Increasing consumer disposable incomes along with expanding the automotive manufacturing industry in emerging economies of India, Thailand, and Malaysia is expected to create lucrative opportunities for industry participants in the near future.
Global automotive battery powered propulsion system market is dominated by major players including RobertBoschGmbh, Denso Corporation, JTET Corporation, Nexteer Automotive, TRW Automotive Holding, and Mitsubishi Electric Corporation. Capacity expansion and new product development are expected to be the major strategies adopted by industry participants.
Other companies having a significant presence in the industry include A123 Systems, GS Yuasa Corp, NEC Corp, and E-One Moli Energy Corp. Development of manufacturing capacity for batteries and electric automotive components forms a major part of investments by these companies. Achieving economies of scale and enhancing energy density of batteries through new solid-state cell technology are expected to play a major role in driving industry growth over the next seven years.
Another composition of the market growth includes joint ventures. RobertBosch acquired a US-based startup company Seeo Inc. this strategic initiative was aimed at acquiring new battery technologies for electric vehicles and drive product demand in Asia and North America.
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The automotive & transportation industry is amongst the most exposed verticals to the ongoing COVID-19 outbreak and is currently amidst unprecedented uncertainty. COVID-19 is expected to have a significant impact on the supply chain and product demand in the automotive sector. The industry's concern has moved on from being centered on supply chain disruption from China to the overall slump in demand for automotive products. The demand for commercial vehicles is expected to plummet with the shutdown of all non-essential services. Furthermore, changes in consumer buying behavior owing to uncertainty surrounding the pandemic may have serious implications on the near future growth of the industry. Meanwhile, liquidity shortfall and cash crunch have already impacted the sales of fleet operators, which is further expected to widen over the next few months. We are continuously monitoring the COVID-19 pandemic, and assessing its impact on the growth of the automotive & transportation industry. The report will account for Covid19 as a key market contributor.