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.
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.
The demand for the electric power steering (EPS) segment held the third-highest market share of around 12.0% in 2021. The EPS segment is given a higher preference between the end-users than other steering systems. It offers many advantages, such as energy economy, decreased mechanical complications, and the ability to adjust a simpler interface. EPS is smaller and lighter than HPS resulting in an energy-efficient vehicle option. The lack of dependability in hydraulic power steering contributes to the market's growth.
The electric vacuum pump segment is expected to witness a significant CAGR of 12.1% during the forecast period. Technological developments are being carried out in the automotive industry to save fuel, gaining prominence on account of increased energy efficiency in engines. The reliable performance of electric vacuum pumps in vehicles helps automakers meet new emission marks by fulfilling the vacuum required for the brake booster. The rise in demand for electric vacuum pumps can be attributed to their ability to deliver a smooth and consistent break-pedal feel to customers.
By hybridization, the market is segmented into Internal Combustion Engine (ICE) & Micro-Hybrid Vehicle, HEV, PHEV, and BEV. ICE segment held the highest market share of around 60.0% in2021. Technological advancements in the automotive industry have led to the introduction of battery electric vehicles. Demand for the product is increasing across the industry such as agriculture, construction, mining, and power generation. The lack of global EV infrastructure availability is also responsible for the uptake of the ICE market. Also, the growing popularity of vehicles using gasoline along with the growing shale gas production is the additional factors driving the market growth.
The PHEV segment is anticipated to expand at the highest CAGR of 14.5% during the forecast period. Collaborations between private and government agencies to develop smart cities across the nation and growing charging infrastructure are the factors expected to increase the demand for plug-in hybrid electric vehicles. Additionally, plug-in hybrid electric vehicles have witnessed substantial growth in technologically advanced nations. Integrated electrification systems for all kinds of transport vehicles, such as freight delivery vehicles, public transport, and 2-wheelers, are being encouraged by government agencies across the globe to reduce reliance on fossil fuels. All these factors add to the market’s growth.
The Asia- Pacific accounted for the highest market share and was valued at USD 43.51 billion in 2021. The government’s initiatives to promote electric vehicles and give subsidies for the purchases are the factors driving demand in the market within this region. The rising population in the countries coupled with increasing per capita income stimulates the demand for the personal transport automobile that is supportive of a sustainable environment.
Europe is expected to see considerable growth in the vehicle electrification industry due to the government’s focus on implementing sustainable infrastructure growth. Furthermore, future investment because of the government support is expected to boost the expansion of the vehicle electrification market during the forecast period.
North America is anticipated to expand at the highest CAGR of 10.7% during the forecast period. The expansion of charging infrastructure and major expenditures by OEMs in the development of vehicle electrification are the factors driving this region's growth. The evolution of the car electrification sector, notably in the United States is accelerated by federal tax credits and rebate incentives.
For instance, in 2021, General Motors, a major American automaker, had revealed plans to introduce electric automobiles designed for personal usage, in the next years. By 2025, the business plans to release 30 electric vehicles worldwide, with around two-thirds of them accessible in North America. The lucrative nature of the market is projected to inspire more traditional vehicle manufacturers to enter the product market, thus, boosting the growth of the market for vehicle electrification.
The companies focus on strategic initiatives such as collaborations and acquisitions to establish a more sophisticated portfolio and retain a competitive position in the vehicle electrification market. For instance, in 2020, CATL, a Chinese EV battery manufacturer, is extending its relationships with Coach B.V. & VDL Bus in the Netherlands and Quantron AG in Germany to advance commercial vehicle electrification in Europe by improving local services and product solutions. Such partnerships, mergers, and acquisitions have created an environment between all contemporaries to employ ideas and innovation for enhanced manufacturing and technologies.
Many companies have introduced innovative technology that has enhanced the user experience. For instance, Continental Technology supplied the necessary components for a pleasant and straightforward user experience in the new BMW iX. Regarding vehicle digitalization, the continental's cockpit high-performance computer is integrated into the electric car.
It keeps track of the increasing software complexity and the cockpit's continuously expanding functional scope. Furthermore, it also includes ultra-wideband transceivers in the electrified variant for smartphone connectivity. Hence, these technological changes are further impacting the market. Some of the prominent players in the global vehicle electrification market include:
Robert Bosch GmbH
Continental AG
Denso Corporation
Delphi Automotive PLC
Johnson Electric
Mitsubishi Electric Corporation
Report Attribute |
Details |
Market size value in 2022 |
USD 89.26 billion |
Revenue forecast in 2030 |
USD 187.13 billion |
Growth Rate |
CAGR of 9.7% from 2022 to 2030 |
Base year for estimation |
2021 |
Actual estimates/Historical data |
2018 - 2020 |
Forecast period |
2022 - 2030 |
Quantitative Units |
Revenue in USD billion, CAGR from 2022 to 2030 |
Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, trends |
Segments covered |
Product, hybridization, region |
Regional scope |
North America; Europe; Asia Pacific; Rest of the World |
Country scope |
U.S.; Canada; U.K.; Germany; China; India; Japan; Brazil; Mexico |
Key Company Profiled |
Robert Bosch GmbH; Continental AG; Denso Corporation; Delphi Automotive PLC; Johnson Electric and Mitsubishi Electric Corporation |
Customization scope |
Free report customization (equivalent to up to 8 analyst working days) with purchase. Addition or alteration to country, regional & segment scope. |
Pricing and purchase options |
Avail of customized purchase options to meet your exact research needs. Explore purchase options |
This report forecasts revenue and volume growth at global, regional, and country levels and provides an analysis of the industry trends in each of the sub-segments from 2022 to 2030. For this study, Grand View Research has segmented the global Vehicle Electrification Market report based on the product, hybridization, and region
Product Outlook (Revenue, USD Billion; 2018 - 2030)
Start/Stop System
Electric Power Steering
Liquid Heater Ptc
Electric Air Conditioner Compressor
Electric Vacuum Pump
Electric Oil Pump
Electric Water Pump
Starter Motor & Alternator
Integrated Starter Generator
Actuators
Hybridization Outlook (Revenue, USD Billion, 2018 - 2030)
Internal Combustion Engine(ICE) & Micro-Hybrid Vehicle
HEV
PHEV
BEV
Regional Outlook (Revenue, USD Billion; 2018 - 2030)
North America
U.S.
Canada
Europe
U.K.
Germany
Asia Pacific
China
Japan
India
Rest of the World
b. The global vehicle electrification market size was estimated at USD 82.91 billion in 2021 and is expected to reach USD 89.26 billion in 2022.
b. Some key players operating in the vehicle electrification market include Robert Bosch GmbH, Continental AG, Denso Corporation, Delphi Automotive PLC, Johnson Electric, and Mitsubishi Electric Corporation.
b. The global vehicle electrification market is expected to grow at a compound annual growth rate of 9.7% from 2022 to 2030 to reach USD 187.13 billion by 2030.
b. Asia Pacific dominated the vehicle electrification market with a share of 43.51% in 2021. This is attributable to the government’s initiatives to promote electric vehicles and give subsidies for purchases.
b. Key factors that are driving the market growth include reduced tailpipe emission standards, rising social Influence & growing concern, and strengthening CO2 regulations.
GET A FREE SAMPLE
This FREE sample includes market data points, ranging from trend analyses to market estimates & forecasts. See for yourself.
NEED A CUSTOM REPORT?
We can customize every report - free of charge - including purchasing stand-alone sections or country-level reports, as well as offer affordable discounts for start-ups & universities.
Contact us now to get our best pricing.
ESOMAR certified & member
Leading SME award by D&B
We are GDPR and CCPA compliant! Your transaction & personal information is safe and secure. For more details, please read our privacy policy.
"The quality of research they have done for us has been excellent."
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.
We value your investment and offer free customization with every report to fulfil your exact research needs.