Battery Electric Car Market Size, Share, Growth, And Industry Analysis, By Type (Storage Battery and Fuel Cell), By Application (Passenger Car and Commercial Vehicle), Regional Forecast To 2031

Updated On: 08 April 2024

Battery Electric Car Market Report Overview

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The global battery electric car market size was USD 53.73 billion in 2021.  As per our research, the market is expected to reach USD 276.49 billion in 2031, exhibiting a CAGR of 16.08% during the forecast period.

The global COVID-19 pandemic has been unprecedented and staggering, with the battery electric car market experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels.The sudden rise in CAGR is attributable to the market's growth and demand returning to pre-pandemic levels once the pandemic is over.

A battery electric car is a form of electric vehicle that solely relies on stored chemical energy in rechargeable battery packages and lacks an additional source of propulsion. Internal combustion engines (ICEs) are not used in battery-powered vehicles; instead, they are replaced by electric engines and motor controllers. They don't have an internal combustion engine, fuel cell, or gasoline tank because all of their power comes from battery packs.

The global battery electric car industry is expanding as a result of a number of important factors, including growing public knowledge of the advantages of electric vehicles, soaring popularity of high-tech electric vehicles, and increased production levels by leading automakers. Additionally, it is anticipated that as attempts to reduce emissions from gasoline-powered vehicles intensify, there will be a greater demand for electric vehicles, which would lead to an increase in battery electric vehicle sales.

COVID-19 Impact: Delays in Investments and R&D Projects as a Result of the Global Lockdown

The COVID-19 epidemic had a detrimental effect on the automotive sector in 2020, which also affected the battery electric vehicle sector as a whole. Manufacturing facilities were shut down as a result of the global lockdown and severe travel restrictions enforced by the government authorities, which also caused a shortage of workers, Li-ion battery packs, and electric components. This also led to delays in investments and R&D projects, which ultimately delayed the introduction of new electric vehicles and decreased the industry revenue of these automakers. However, the sector is expected to experience steady growth over the anticipated period because of government regulations and stimulus programmes that are supportive of meeting emission limits.

Latest Trends

"Utilization of New LFP Batteries in Tesla’s Electric Cars to Boost Profits and Require Zero Maintenance"

The development of improved battery solutions for battery electric automobiles would be aided by quick investments in R&D projects by industry players. To boost its profit margin, Tesla, for instance, stated in October 2021 that all of its standard range electric cars will now employ Lithium Iron Phosphate (LFP) based batteries. Compared to nickel-cobalt aluminum battery packs, the new LFP batteries are easier to recycle, have a longer expected life, and need no maintenance. They are also lighter and more efficient at charging and discharging.

Battery Electric Car Market Segmentation

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• By Type Analysis

According to type, the market can be segmented into Storage Battery and Fuel Cell

• By Application Analysis

Based on application, the market can be divided into Passenger Car and Commercial Vehicle

Driving Factors

"Depletion and Rising Costs of Fossil Fuels Promotes the use of Electric Cars as they are more Cost Effective "

Because it is a fossil fuel, gasoline is not a sustainable energy source and will eventually run out. Alternative fuel sources must be created and used in order to promote sustainable growth. Battery electric vehicles, which are more cost-effective than conventional vehicles and do not require gasoline. When compared to gas-powered cars, electric vehicles are able to convert almost 50% of the electrical energy from the grid to power at the wheels, while gas-powered vehicles can only do this with 17%–21% of the energy stored in gasoline. Due to the rising cost of gasoline and diesel, there has been an increase in the usage for fuel-efficient automobiles. The depletion of fossil fuel deposits and the rising propensity of businesses to generate profit from these oil reserves are attributed to this. Therefore, these factors increase the need for cutting-edge fuel-efficient technologies, which in turn increases the use of battery electric car for transportation.

"Growing Environmental Concerns Promoted Governments to Pass Strict Emission Standards which is in turn Fuel’s the Battery Cars Industry"

As environmental concerns rise, governments and environmental organizations around the world are passing strict emission standards and laws to minimize car emissions. Significant regulatory initiatives include strict emission objectives for lowering levels of carbon dioxide (CO2) and nitrogen oxides (NOx) in the atmosphere. Increasing attempts are being made to make transportation in the United States cleaner due to high levels of greenhouse gas emissions from vehicles. As a result, the strain on vehicle manufacturers, particularly those of commercial vehicles, has grown since the emission limits for fossil fuel-powered cars were put into effect. This is anticipated to fuel the battery electric car market growth. As a result, stringent emission standards set on fossil fuel-powered commercial vehicles considerably contribute to the market's expansion for batteries.

Restraining Factors

"Cost of Manufacturing Electric Cars is Higher than ICE Vehicles which could Potentially Obstruct the Growth of the Market"

In order for electric automobiles to be adopted widely, their high production costs have been a key worry. In order for the cost of buying electric cars to be comparable to ICE vehicles, it is projected that battery prices will plummet and that R&D expenses would decrease. This will increase demand for electric vehicles. Because the rechargeable lithium-ion batteries used for electric cars are more expensive than those for internal combustion engines (ICE), their cost is much higher than that of ICE vehicles. Because expensive raw materials like cobalt and magnesium are used in the production of cathodes, the cathode price has a significant impact on the price of batteries. Due to the costly development process used to create these vehicles, the cost of producing electric automobiles is also higher than that of ICEs. Due to the need for batteries with greater specifications, advanced manufacturing techniques, and extremely expensive components utilized in the automobiles, developing battery electric car with longer ranges is substantially more expensive.

Battery Electric Car Market Regional Insights

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"Significant Investments and Massive Consumer Base in the Region Drive the Asia Pacific Market "

The market for battery electric vehicles in Asia Pacific was the biggest in 2021. Leading firms in the area have made it possible to produce these batteries in such large quantities. Top multinational corporations make significant investments in these nations because they provide inexpensive labor, other production inputs, and pro-industrial government regulations. The Asia Pacific battery electric car market share is primarily driven by the region's massive consumer base, growing demand for passenger and commercial vehicles, increasing investment in the construction of charging infrastructure, and expanding government initiatives to encourage the adoption of electric vehicles.

During the time of forecasting, North America is anticipated to have strong growth. In the near future, the development of the battery electric car industry is anticipated to be significantly impacted by a number of key factors, including strict government legislation concerning emissions and the adoption of electric vehicles, rise in disposable income and heightened consumer awareness of the advantages of battery electric vehicles, a high environmental consciousness, and the presence of leading automakers in the region. The expansion of this industry is being aided by rising customer demand for environmentally friendly goods and rising uptake of cutting-edge technologies.

Key Industry Players

"Key Players are Diversifying their Product Lines and Mergers are Methods Adopted to Increase Consumer Recognition of their Brand  "

Prominent businesses are confident in their ability to carry out strategies that would increase consumer recognition of their brand. To increase their international footprint and solidify their market position, a number of businesses place a strong emphasis on diversifying the products in their product lines. The corporation uses a number of strategies, such as launching unique items and joining forces with other significant businesses or end customers, to expand the reach of their products. Another essential method for enhancing one's presence in the global market is joining forces with or obtaining multiple firms.

List of Market Players Profiled

• General Motors (U.S.)
• Toyota Motor Corporation (Japan)
• Honda Motor (Japan)
• Nissan Motor (Japan)
• BMW Group (Germany)
• BYD Company (China)
• Hyundai Motor (South Korea)
• Tesla Motors (U.S.)
• Ford Motor (U.S.)
• Daimler (Germany)
• Groupe Renault (France)

Report Coverage

This report covers the battery electric car market. The CAGR expected to be in during the forecast period, and also the USD value in 2021 and what it is expected to be in 2031. The effect COVID-19 had on the market in the beginning of the pandemic. The latest trends taking place in this industry. The factors that are driving this market as well as the factors that are restraining the growth of industry. The segmentation of this market based on type and applications. The region leading in the industry and why they will continue to do so during the forecast period. Further, the key market players, what all is being done by them to stay ahead of their competition as well as retain their market positions. All these details are covered in the report.