According to the new market research report published by MarketsandMarkets, the vehicle electrification market is projected to grow from $73.7 billion at a compound annual growth rate of 11.9% to reach $129.6 billion by 2025. According to the report’s authors, vehicle electrification is a preferred option for forward-thinking OEMs in the near future due to various benefits such as decreased vehicle weight, lower emissions, increased fuel efficiency, improved driving comfort, and safety.
Electrification of a vehicle is considered the best way to reduce carbon emissions, increase vehicle efficiency, and reduce dependency on oil. It generates new opportunities for consumer engagement, along with various environmental and economic benefits.
On the technology side, researchers say that the vehicle-electrification market is dominated by a few global players and comprises several regional players, among them are Bosch, Continental, Delphi Technologies, Denso, and Johnson Electric.
The passenger car segment is estimated to be the largest segment as the production of passenger cars is high compared to other vehicle types. Production of passenger cars in Asia/Oceania is the highest with more than 49 million units, followed by Europe with more than 18 million.
According to the analysis, Europe is estimated to have a 45.5% share of the total mild-hybrid, 48-V, electrical-architecture vehicle market in 2019, and that market is expected to continue to dominate in that area. A 48-V system consists of a 48-V lithium-ion battery, DC/DC converter, and an integrated starter generator (ISG). Without replacing the present 12-V architecture completely, the higher voltage architecture works in parallel with the combustion engine and regular 12-V battery. This parallel combination helps boost the efficiency of parts like electric oil, coolant, and vacuum pumps.
Developed infrastructure such as charging stations, the limited range of present day BEVs (battery-electric vehicles), and the high cost of stronger HEVs (hybrid-electric vehicles) and PHEVs (plug-in hybrid-electric vehicles) are the few reasons why milder 48-V vehicles are preferred over stronger hybrid vehicles in Europe. This trend is estimated to continue for the next 10 years.
However, North America is expected to be the fastest growing market for electrification, the positive outlook owing to effective infrastructure and tax exemption, subsidies, and special facilities provided by local governments in the region. U.S. companies are set to dominate the NA market, as the country has the presence of major OEMs and Tier 1 players, adoption of electric components in ICE vehicles, BEVs, HEVs, and PHEVs is high.
