Electric Car Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Electric Car Market Trends & Drivers

Consolidation and Joint Ventures Are a Key Trend

• Key players are involved in consolidation and joint ventures to improve their market share is a key trend in the industry.
• For instance, foreign companies are entering the Chinese market through partnerships with local players. Companies are also collaborating and aiming at synergies to share technological knowledge with each other.
• BYD is planning to expand its business by collaborating with Daimler AG to manufacture electric cars in China. Volkswagen, together with SAIC Motor, is also working toward the development of electric cars in China.
• Similarly, Geely is considering the manufacturing of Lynk & Co. branded electric vehicles in Europe and the U.S.
• BMW is also planning to form an electric vehicle joint venture with Great Wall Motor Company Limited in China.

Stringent Emission Norms Is a Key Driver

• The emission of greenhouse gases (GHG) has increased significantly over the last decade. To limit the adverse effects of these gases, several actions have been taken all around the world.
• For instance, in September 2023, the Ministry of Science & Technology announced that India would reduce carbon dioxide emissions by 1 billion tons by 2030. Similarly, many countries have proposed motor vehicle fuel efficiency and GHG emission policies to reduce vehicle emissions.
• The growing environmental concern around the world is leading to a gradual phase-out of fossil fuels. Stringent emission norms would ultimately increase the price of conventional cars and encourage customers and automobile companies to adopt electric cars.
• Many countries have increased the taxes on conventional fuel cars and, at the same time, are offering many financial and non-financial incentives for electric cars to promote the sale of low-emission vehicles.

Lack of adequate charging infrastructure and value chain ecosystems

• One of the most important factors for the long-term success of electric cars is the presence of adequate charging infrastructure, which includes charging stations, and a mature value chain ecosystem, which includes support from many industry players and utilities to financial institutions.
• There are indeed many challenges to the mass adoption of electric cars. For instance, as the penetration of electric cars increases with the total car sales, it would put a strain on electricity grids, and more power plants would be required to charge these cars. Besides, more even distribution of charging stations across cities and highways would be required.
• Most countries do not have adequate public charging infrastructure. For instance, in France, for every 10,000 registered vehicles, there is only one charging point. Similarly, the average number of charging stations in Germany is around 0.19 per 1,000 electric vehicles. An inadequate number of charging stations is a real issue among consumers.
• Moreover, government subsidies will have a limited effect on electric car adoption if there is not adequate charging infrastructure. As the average charging time of an electric car is high, a shortage of public charging stations would lead to congestion, which would further lead to reduced public interest in electric cars.
• Apart from charging stations, support from other entities such as electricity utilities, financial institutions, service providers, and leasing companies is quite limited to back the growth of the market.

Electric Car Market Analysis

Technology Insights

• BEVs have maintained the largest share of the market, partly due to the launch of advanced BEV models. Moreover, the market growth would be aided by the rise in investments by industry participants in R&D projects to provide cutting-edge battery solutions for BEVs.
• For instance, in order to boost its profit margin, Tesla stated in October 2021 that all of its standard-range electric cars would employ lithium–iron phosphate (LFP) batteries.
• BEVs are expected to have a larger share than PHEVs during the forecasted period, as government subsidies and schemes continue to favor BEVs over PHEVs, as they are eco-friendly.
• For instance, in France, electric cars emitting up to 20 g CO2/km (mostly BEVs) receive more tax exemptions than electric cars with 21 g to 60 g CO2/km (mostly PHEVs).
• Similarly, in the U.S., the Zero Emission Vehicle (ZEV) credit for BEVs is more than that for PHEVs, which is encouraging car companies in the region to sell more BEVs than PHEVs.

Technology types covered in the report include:

• Battery Electric Vehicle (BEV) (Larger and Faster-Growing Category)
• Plug-In Hybrid Electric Vehicle (PHEV)

Segment Insights

• The economy category is estimated to have accounted for the largest revenue share, of 45%, in the market in 2024.
• This is ascribed to the lower prices of vehicles in this segment as compared to medium- and premium-segment vehicles, coupled with their preference in key markets such as China.

The following segments are included in the report:

• Economy (Largest Category)
• Low
• Medium (Fastest-Growing Category)
• Premium

APAC Is the Largest Market

• APAC is the largest regional market, with an estimated share of around 50% in 2024. In the region, China is the leading market, driven by the high-volume manufacturing of electric cars, supported by government support and reimbursement policies.
• As EVs are more expensive than traditional ICE vehicles, the Chinese government began offering large subsidies for the former in 2009. Since then, the central government has spent more than RMB 200 billion on EV subsidies, while local governments have added another RMB 100 billion, for a total of USD 47 billion.
• The government plans to continue offering support to the industry via many other initiatives, such as Phase IV standards, which require automobile companies to reduce fleets’ average fuel consumption.
• Moreover, as per the emission rules introduced in 2017, companies manufacturing or importing more than 30,000 vehicles annually had to obtain carbon credit points or scores.
• These credit points can be transacted among automobile companies, which would also encourage them to increase the share of EVs in sales. Besides, the government is planning to ban the sale of conventional automobiles by 2030.
• Due to such strong government support for clean transportation, the Chinese electric car market is highly competitive.
• In addition, sales are expected to pick up even more in the coming years because of the declining battery costs and the implementation of new policies.
• Specifically, during the forecast period, BEV sales in the country are expected to grow significantly, benefitting from the policies and mandates favoring ZEVs.
• Affordable, small cars (which are most often BEVs) are preferred by Chinese customers, which would continue to benefit their sales during the forecast period.
• On the other hand, the European market is expected to witness the highest CAGR, of around 35.0%, over the forecast period, primarily as a result of the rapidly increasing adoption of such vehicles in Norway, Germany, and the U.K.
• Along with the significant incentives for purchases in the region, the initiation of numerous programs for the setup of the charging infrastructure is predicted to have a positive impact on the European market.
• In addition, the U.S. market is expected to experience significant growth, advancing at a CAGR of 34.5%, over the forecast period, because of the increasing government support for environment-friendly automotive technologies.
• For instance, the important initiatives for EVs in the country include the U.S. Federal Tax Credit of USD 7,500 on their purchase, Corporate Average Fuel Economy (CAFE) standards, and the ZEV program in California and other states.
• Furthermore, the demand for EVs in Canada has been largely concentrated in Quebec and Ontario, due to the attractive purchase subsidies and non-financial incentives, such as local waivers on fees and access to high-occupancy vehicle lanes.
• Sales have also benefited from the large number of new PHEV models introduced in recent years, including the Audi A3 e-tron, Tesla Model X, Hyundai Sonata PHEV, Volvo XC90 PHEV, BMW 740e, BMW 330e, BMW X5 xDrive40e, Mercedes-Benz S550e, and Mercedes-Benz GLE550e. Therefore, the Canadian market will experience a significant CAGR during the forecast period.

Further, regions and countries analyzed for this report include:

• North America
  • U.S. (Larger and Faster-Growing Country Market)
  • Canada
• Europe (Fastest-Growing Regional Market)
  • Germany (Largest and Fastest-Growing Country Market)
  • U.K.
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific (APAC) (Largest Regional Market)
  • China (Largest Country Market)
  • Japan
  • India (Fastest-Growing Country Market)
  • South Korea
  • Australia
  • Rest of APAC
• Latin America (LATAM)
  • Brazil (Largest and Fastest-Growing Country Market)
  • Mexico
  • Rest of LATAM
• Middle East and Africa (MEA)
  • Saudi Arabia (Largest Country Market)
  • South Africa
  • U.A.E. (Fastest-Growing Country Market)
  • Rest of MEA

Electric Car Market Share

The global electric car market is consolidated in nature, with top players accounting for more than 50% of the total sales. Some of the top players are Toyota Motor Corporation, Honda Motor Co. Ltd., BMW AG, Ford Motor Company, Volkswagen AG, General Motors Company, Hyundai Motor Company, and Tesla Inc. These key players are mainly focusing on partnerships for the production and development of batteries, introduction of advanced products, geographical expansion, and others, to gain a competitive advantage.

Electric Car Market News

• In July 2023, Toyota Motor Corporation announced that it would boost the development of EV technology in China, with the aim to ultimately reduce manufacturing costs.
• In October 2023, Honda Motor Co. Ltd. and Mitsubishi Corporation signed an MoU to explore new businesses to build sustainable business models in order to match the growth of the EV sector toward a decarbonized future society.
• In January 2023, BMW Group and Solid Power deepened their Joint Development Partnership to start an ASSB prototype line in its CMCC in Parsdorf near Munich.
• In April 2023, Volkswagen announced a partnership with Shell Germany to introduce the Flexpole charging station, the first innovative, into operation in Goettingen.