Overview of the Report
The global market for electric passenger cars was worth USD 120.81 billion in 2020, and it is predicted to increase at a 32.5 percent compound annual growth rate (CAGR) from 2021 to 2028. In the first half of 2020, global passenger car sales fell significantly as the automobile industry dealt with the negative consequences of COVID-19 lockout regulations. Despite the instability, the market enjoyed a watershed year in 2020, with sales hitting about 3.0 million units, nearly a 40% rise over 2019. With the success of WulingHongguang Mini EV and Tesla Model 3, China was a key market disruptor with government support. Over the projected period, the country will account for over 30% of worldwide electric car sales, with the developing network of public EV charging infrastructure and an expected increase in consumer demand supporting the growth.
In 2020, the battery electric vehicle segment accounted for over 60% of total sales, and this dominance is likely to continue throughout the forecast period. More than 15 BEV vehicles will be available in the United States by 2021. In comparison to PHEV, BEV is predicted to expand at a slower pace, owing to range concern. The Tesla Model S, which has a longer range, is the most popular BEV, but the Model 3, which has the lowest cost per km, is the most efficient. In 2020, the vendor accounted for more than 70% of all BEV sales.
A set of technologies that use electricity to propel a vehicle is referred to as an electric passenger automobile. Electric vehicles are meant to run on electricity rather than fossil fuels, reducing fossil fuel consumption. Electric vehicles are also anticipated to aid in meeting the goal of low vehicle carbon emissions. Automobile manufacturers all around the world are working hard to create and introduce electric vehicles on the road as soon as possible.
For the past few years, automotive production has increased, which is projected to drive the electric passenger car market during the projection period. Rising concerns about energy security, fossil fuel emissions, and long-term industrial competitiveness are expected to prompt governments around the world to take positive steps to find a partial solution by creating incentives or investing in the automotive sector to help fuel the electric passenger car market in the near future. Increasingly severe rules and regulations addressing enhanced fuel efficiency and decreased carbon footprint, which are being imposed by governments around the world, are projected to drive the electric passenger vehicle market forward over the forecast period.
The Impact of COVID-19 on the Global Electric Passenger Car Market
The influence of COVID-19 on the global electric passenger car sector is being actively monitored by the QMI team, and our team has seen that demand for electric passenger cars has increased since the epidemic began. During the forecast period, the market is expected to rise rapidly. The pandemic epidemic has dramatically altered the outlook for the electric passenger car market in 2020 and 2021. Following the shutdown, the market has grown as a result of several government initiatives. Internal combustion vehicles are expected to be phased out completely in the next 10 to 30 years in several countries. Given countries’ aim to achieve net-zero emissions and how governments in key car markets responded to the Covid-19 crisis by emphasising assistance for electric vehicles in recovery plans, there are reasons to be positive.
Market for Electric Passenger Cars in the World, by Propulsion Type
The global electric passenger car market is divided into four categories: battery electric vehicles (BEV), plug-in hybrid electric vehicles (PHEV), fuel cell electric vehicles (FECV), and hybrid electric vehicles (HEV). The PHEV category is growing at the fastest rate, thanks to several government programmes in developing and developed countries to promote the use of PHEV batteries to power electric motors. The use of plug-in hybrid electric vehicles (PHEVs) helps to reduce reliance on gasoline. If the carbon intensity of grid power is lowered, PHEVs will be able to dramatically reduce greenhouse gas (GHG) emissions from the light-duty vehicle sector.
In 2020, the European market accounted for almost 45 percent of total revenue. Electric passenger car sales are expanding in nations like Germany, France, Norway, and the United Kingdom, which accounts for the high revenue share. As part of their efforts to combat the pandemic’s consequences, governments across Europe have raised incentives for electric vehicles. In Germany, for example, the government increased incentives for BEV and PHEV purchases by roughly USD 2,500 and USD 1,500, respectively.
From 2021 to 2028, Asia Pacific is expected to grow at a CAGR of approximately 37% in terms of revenue. Countries like China, Korea, and Japan dominate the regional market. China, as the world’s largest manufacturer and consumer of electric passenger vehicles, is likely to hold a commanding position during the forecast period. The government has taken a variety of initiatives to encourage the adoption of electric vehicles, including EV buyer subsidies, the development of electric vehicle charging stations, and rules requiring automakers to produce electric vehicles based on the number of vehicles produced.
From 2021 to 2028, North America is expected to have the second-highest CAGR of over 39% in terms of revenue. In 2020, the United States accounted for the biggest revenue share, and this trend is likely to continue throughout the forecast period. However, sales of electric vehicles in the United States fell in 2019 and 2020 when the federal tax credit for General Motors Company and Tesla was reduced.