The electric powertrain market is rapidly expanding as automakers shift their focus towards electric vehicles (EVs) and sustainable transportation. The market encompasses various components that make up an EV’s powertrain, such as electric motors, battery packs, and power electronics. This industry is predicted to grow at an impressive rate over the next few years, driven by various factors, such as consumer demand, government incentives, and technological advancements.
The global electric powertrain market was valued at $37.98 billion in 2020 and is predicted to grow at a compound annual growth rate (CAGR) of 18.6% from 2021 to 2028, to reach a value of $135.23 billion. This growth is attributed to the increase in consumer demand for sustainable transportation. Governments around the world are setting goals for electric vehicles to make up a significant portion of the total vehicles on the road. For instance, the UK government aims to ban the sale of new petrol and diesel cars by 2030.
One of the significant drivers of growth in the electric powertrain market is the increasing demand for EVs. With global sales of EVs reaching 3 million units in 2020, automakers and technology companies are investing heavily in EVs and the associated powertrain components. Some of the leading automakers in this industry include Tesla, General Motors, Volkswagen, and Ford. These companies have invested heavily in research and development to improve electric motors, battery cells, and power electronics.
Another driver of growth in this industry is government incentives and regulations that promote the adoption of EVs. Governments worldwide are implementing policies that aim to reduce carbon emissions and promote sustainable transportation. These policies include tax incentives for EV buyers, subsidies for EV manufacturers, and regulations that require automakers to produce a certain percentage of zero-emissions vehicles.
Technological advancements have also contributed to the growth of the electric powertrain market. Battery technology, in particular, has improved significantly in recent years, with higher energy density and longer range. This has addressed one of the main concerns of consumers when it comes to EVs, which is range anxiety. The development of fast-charging technology has also helped to address this concern.
The electric powertrain market is predicted to see significant innovation and competition in the coming years. Many automakers and technology companies are investing heavily in the development of EVs and the associated powertrain components. For instance, Tesla has developed its own electric motors, battery cells, and power electronics and has invested heavily in research and development to improve these components. Other automakers, such as General Motors, Volkswagen, and Ford, have also made significant investments in EVs and the electric powertrain market. These investments are expected to drive innovation and competition in the market, leading to further improvements in technology and lower prices for consumers.
Despite the tremendous growth potential in the electric powertrain market, there are also several challenges that must be addressed. One of the significant challenges is the high cost of EVs compared to traditional gasoline-powered vehicles. Although the cost of EVs has come down significantly in recent years, they are still more expensive than their gasoline-powered counterparts. This can make it difficult for some consumers to justify the switch to EVs.
Another challenge is the lack of charging infrastructure for EVs. Although this is improving, with many governments and private companies investing in charging stations, there is still a long way to go before charging infrastructure is as ubiquitous as gas stations. This can make it difficult for EV owners to travel long distances and can contribute to range anxiety.
In conclusion, the electric powertrain market is predicted to see significant growth in the coming years, driven by increasing consumer demand for sustainable transportation, government incentives and regulations, and technological advancements. The market is also expected to see significant innovation and competition, which will drive further improvements in technology.
Disclaimer: The views, suggestions, and opinions expressed here are the sole responsibility of the experts. No Everest Market Insights journalist was involved in the writing and production of this article.
