New Energy Vehicle Market Size, Share, Growth, And Industry Analysis, By Type (HEV, PHEV, EV), By Application (Commercial Vehicle, Passenger Vehicle), Regional Forecast From 2022 to 2028

Updated On: 08 April 2024

New Energy Vehicle Market Report Overview

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The global new energy vehicle market size was USD 65850 million in 2022, as per our research, the market is expected to reach USD 259785.75 million by 2031, exhibiting a CAGR of 16.5% during the forecast period. 

The global COVID-19 pandemic has been unprecedented and staggering with the dispensing closure 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 New Energy Vehicle (NEV) is a type of vehicle that uses alternative sources of energy, such as electricity, hydrogen fuel cells, and hybrid powertrains, instead of traditional fossil fuels like gasoline or diesel. NEVs include Electric Vehicles (EVs), Hybrid Electric Vehicles (HEVs), Plug-in Hybrid Electric Vehicles (PHEVs), and Fuel Cell Electric Vehicles (FCEVs). These vehicles are designed to be more environmentally friendly and energy-efficient than traditional combustion engine vehicles, with lower emissions and reduced reliance on non-renewable resources. They are gaining popularity as a way to fight climate change and enhance air quality.

The success and general adoption of New Energy Vehicles depend heavily on the expansion of the charging infrastructure. The availability and convenience of charging infrastructure significantly affect consumer behavior when deciding to purchase a NEV. As more people switch to NEVs, there is a greater need for an expanded network of charging stations that can support these vehicles. Governments and companies around the world are investing in charging infrastructure to meet the needs of NEV drivers. Public charging stations are being installed in parking lots, on-street parking, and other public areas to provide convenient and accessible charging options for NEV users. Private companies are also investing in charging infrastructure, with retail stores, malls, and restaurants offering charging stations as a customer amenity. Fast chargers are becoming increasingly popular in charging infrastructure, allowing quicker charging times and reducing the time required for charging a vehicle. Fast chargers make long-distance travel more practical by recharging an EV battery to 80% capacity in as little as 30 minutes. Some fast chargers are also being integrated with renewable energy sources, such as solar panels, to provide sustainable and environmentally friendly charging options. In addition to expanding the charging infrastructure, there is also a push towards interoperability, which would allow NEV drivers to use any public charging station with their vehicles, regardless of the charging network provider. Standardizing charging systems and payment methods will help reduce barriers and increase the convenience of charging a NEV. The growth of charging infrastructure is essential to the success and mass adoption of NEVs. Government and companies' investment in charging infrastructure will be crucial in promoting the widespread use of NEVs and transitioning towards a sustainable and low-carbon transportation sector.

COVID-19 Impact: Pandemic caused a slowdown in market growth due to supply chain disruptions and decreased demand

At the onset of the pandemic, there was a decrease in demand for NEVs due to economic uncertainty and decreased consumer spending. This was coupled with disruptions in the supply chain, including factory shutdowns and delays in parts shipments. As the pandemic continued and countries began to focus on economic recovery, there has been an increased focus on investing in green technology, including NEVs. In some countries, governments have implemented stimulus packages that include incentives for the purchase of NEVs and the expansion of charging infrastructure. The pandemic has led to a shift in consumer behavior, with more people interested in owning a personal vehicle for safety reasons. This has increased the demand for NEVs as a more environmentally friendly and cost-effective alternative to traditional vehicles. The impact of COVID-19 on the NEV market has been mixed, with initial setbacks in demand and supply chain disruptions, but also with the increased focus on green technology and a shift in consumer behavior towards personal vehicle ownership.

Latest Trends

"Integration of renewable energy sources reduces emissions and increases the use of sustainable energy"

The integration of New Energy Vehicles (NEVs) with renewable energy sources such as solar and wind power is a growing trend in the transportation sector. This integration offers numerous benefits, including reducing carbon emissions, promoting energy efficiency, and increasing the use of renewable energy. Solar and wind power are clean and renewable energy sources that can be used to power electric vehicles. Solar panels can be installed on the roofs of homes or carports, and wind turbines can be used to generate electricity for charging stations. In this way, NEVs can be charged using renewable energy sources, reducing their carbon footprint. The integration of NEVs with renewable energy sources is also helping to increase the use of renewable energy in the transportation sector. Using solar and wind power to charge NEVs requires less energy using solar and wind power to charge NEVs, and less energy is required from the grid, reducing the demand for electricity generated from non-renewable sources. the use of renewable energy sources can improve the energy efficiency of NEVs. Solar panels and wind turbines can generate electricity directly at the point of use, reducing energy losses that occur during transmission and distribution from centralized power plants. This can result in more efficient use of renewable energy sources and lower energy costs. Individuals and businesses can also generate their electricity using solar panels or wind turbines, reducing their dependence on centralized energy systems. The integration of NEVs with renewable energy sources is an emerging trend that offers numerous benefits. By reducing emissions, promoting energy efficiency, and increasing the use of renewable energy, this integration is helping to pave the way for a more sustainable and low-carbon transportation sector driving the new energy vehicle market growth.

New Energy Vehicle Market Segmentation

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• By Type Analysis

According to type, the market can be segmented into HEV, PHEV, and EV.

• By Application Analysis

Based on application, the market can be divided into commercial vehicles and passenger vehicles.

Driving Factors

"Advancements in battery technology have reduced the cost and improved the performance of these energy vehicles, driving their market growth"

Battery technology is one of the most critical factors driving the growth of the New Energy Vehicle (NEV) market. Significant advancements in battery technology have led to increased energy density, longer battery life, and faster charging times, making them more accessible and practical for consumers. Increased energy density means that batteries can store more energy in the same physical space, allowing it to travel further on a single charge. Longer battery life means that it can be used for more extended periods without requiring a recharge, which enhances its practicality and convenience. Faster charging times allow these vehicles to be charged more quickly, reducing the time required for recharging and increasing the usability of NEVs. In recent years, there have been significant advancements in battery technology, including the development of lithium-ion batteries, which are currently the most commonly used type of battery in these vehicles. These batteries are lightweight, have a high energy density, and can be recharged quickly. The cost of lithium-ion batteries has been decreasing steadily, making them more affordable for consumers. Another area of advancement in battery technology is the development of solid-state batteries. Solid-state batteries are expected to have higher energy density and longer life than traditional lithium-ion batteries, and they are also safer and more environmentally friendly. The advancements in battery technology are a key driver of the market, and they have played a significant role in reducing costs and improving the performance of NEVs. The continued development of battery technology is expected to further enhance the usability and sustainability of NEVs, making them a more accessible and practical option for consumers.

"Electrification of commercial vehicles is reducing emissions, and operating costs, and driving innovation for sustainability"

The electrification of commercial vehicles is gaining momentum globally as governments and companies recognize the benefits of transitioning to cleaner, more sustainable transportation options. Buses, delivery vans, and trucks are among the commercial vehicles being electrified, intending to reduce emissions and operating costs. One of the primary benefits of electrifying commercial vehicles is the significant reduction in emissions. Commercial vehicles are responsible for a significant proportion of greenhouse gas emissions, and electrifying them can help to reduce pollution and improve air quality in cities. Additionally, electric vehicles have lower operating costs compared to traditional internal combustion engine (ICE) vehicles, which can result in significant savings for companies. Governments and companies around the world are investing in electric fleets, to achieve a more sustainable transportation system. For example, many cities have committed to transitioning to electric buses, with some aiming to have all of their buses electric by a certain date. Similarly, delivery companies invest in electric vans and trucks to reduce their carbon footprint and operating costs. The electrification of commercial vehicles also drives innovation in the electric vehicle industry. For example, some companies are developing specialized electric trucks for specific applications, such as refuse collection or delivery in urban areas. Additionally, advancements in battery technology are enabling larger and more powerful electric trucks to be developed, which can carry heavier loads and travel further on a single charge. As technology continues to improve, the electrification of commercial vehicles is likely to accelerate, leading to a cleaner, more sustainable future for transportation.

Restraining Factors

"Improved fuel efficiency and emissions of traditional vehicles restrain the markets with limited incentives"

Traditional vehicles are improving in terms of fuel efficiency and emissions through the use of new technologies and advancements in engine design. This means that they are becoming more environmentally friendly and cost-efficient to operate, which can make them a more attractive option for some consumers compared to new energy vehicles. Additionally, traditional vehicles have a well-established infrastructure for fueling and servicing, which can make them more convenient for consumers. As a result, NEVs face competition from traditional vehicles, particularly in markets where government incentives and subsidies for NEVs are limited or nonexistent. However, as battery technology improves and more charging infrastructure is built, NEVs are likely to become a more attractive option for consumers, particularly for those concerned about the environment and the long-term cost of operating a vehicle. As governments set targets for reducing emissions from transportation, NEVs are likely to become an increasingly important part of the transportation mix, which could help to overcome some of the competition from traditional vehicles.

New Energy Vehicle Market Regional Insights

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"Asia Pacific leads the market due to government policies, environmental concerns, and technological advancements"

The leading region in the global market is Asia Pacific, which holds the largest new energy vehicle market share and is expected to grow at a fast pace. China is the world's largest market, accounting for the majority of sales globally. The Chinese government has implemented policies to promote new energy vehicles, including subsidies and quotas for sales, which have helped to drive growth in the market. Japan and South Korea are also significant players in the market in the region. The factors driving growth in the region include increasing concerns about air pollution and the environment, government policies promoting NEVs, and advancements in battery technology. The Asia Pacific region is expected to continue to lead the global market due to ongoing government support and increasing consumer demand for environmentally friendly vehicles. The region is home to many of the world's largest manufacturers, including BYD, Tesla, and Nissan, which are expected to continue to drive growth in the market through innovative products and technology.

Key Industry Players

"Key market players are investing in battery tech, expanding product lines, and charging infrastructure"

The market has several key players who are focused on investing in battery technology, expanding their product lines to include more electric and hybrid models, and building charging infrastructure networks. Many of these players are also partnering with other companies, such as automakers and ride-sharing platforms, to expand their market share. These companies are committed to producing high-performance electric vehicles that can compete with traditional vehicles in terms of range and performance. To achieve this, they are investing heavily in research and development to improve battery technology and reduce production costs. These companies are expanding their reach in the global market by forming strategic partnerships with government agencies and other companies to build charging infrastructure networks. By doing so, they are not only contributing to the growth of the new energy vehicles market but also helping to reduce emissions and create a more sustainable transportation future.

List of Market Players Profiled

• TOYOTA (Asia Pacific)
• Nissan (Asia Pacific)
• Tesla (US)
• Mitsubishi (Asia Pacific)
• GM (US)
• Ford (US)
• BMW (Europe)
• Renault (Europe)
• Volvo (Europe)
• Mercedes-Benz (Europe)
• Volkswagen (Europe)
• Honda (Asia Pacific)
• FIAT (Europe)

Report Coverage

The primary subjects of this research are the market's size and value at the global, regional, and company levels. The size of the global market is presented in this study based on an analysis of past data and future growth. This report focuses on some significant geographic regions, such as China, Japan, North America, and Europe. The study report includes detailed divisions by area, company, kind, and end user. Knowing the categories makes it simpler to recognize the importance of numerous factors that influence market growth.