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Electric Powertrain Market: Information by Vehicle Type (BEV, HEV), Component (Motor, Battery, and Power Electronics Controller), and Region — Forecast till 2030

Market Snapshot
Study Period:
2020-2030
Base Year:
2021
Fastest Growing Market:
Europe
Largest Market:
North America
CAGR:
32 %
Key Players
Borgwarner Inc

Continental AG

Magna International Inc

Marelli Holdings Co Ltd

Mitsubishi Electric Corporation

The global electric powertrain market size is to grow by USD 760 billion by 2030 at a CAGR of 32% from the early figures of USD 61 billion in 2021. The value chain of the electric powertrain market includes tier 2+ suppliers, tier 1 suppliers, integrated electric chassis solution providers, Original Equipment Manufacturers (OEMs), and new electric vehicle startups. Steel, plastic, aluminum, rubber, aluminum alloys, nickel, lithium, and cobalt are some of the raw materials used to make electric powertrain parts. Motor, reducer, battery, on-board charger, and battery management system are the main parts of an electric powertrain. In the automotive industry, the value chain from tier 2+ to tier 1 suppliers to OEMs has been the norm for the past few decades. With the improvement of electric vehicle technology, the supply chain has changed into an ecosystem where the lines between industries are not fixed. 

The tier 1 suppliers are changing their product lines and moving down to become tier 0.5 by providing integrated electric chassis solutions. The pressure on the tier 1 supplier market is going up because companies are changing how they do business. For example, the fact that there are more than 20 e-motor suppliers on the market makes it a very complex and competitive place. Also, low OEM margins on EVs, a lot of competition, and a small market size would make the market environment more difficult.  

Electric Powertrain Market Share

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Market Dynamics

Global Electric Powertrain Market Drivers

  • Growing Demand for Vehicle Electrification in the Automotive Industry and the Sudden Increase in the Sales of Electric Vehicles Driving the Market

Major automakers like Tesla, Honda, Ford, Toyota, and General Motors have put a lot of money into making cars more electric, which has led to a big rise in demand for electric cars. Also, the growing partnerships between automakers and makers of electric motors should boost the demand for electric vehicles. For example, General Motors Co. and Honda Motors Co. announced that they would work together to create a North American automotive alliance. By 2023, General Motors wants to sell 20 models of electric cars, and Honda wants to use GM's battery pack to make two models of plug-in electric cars. 

Electric cars are becoming more and more popular, so the biggest car companies are making electric cars. For example, in 2019, Maruti Suzuki, a leader in the market for traditional cars, said it would start selling electric cars for personal use on the Indian market in the coming years. More and more traditional vehicle makers are likely to switch to making electric vehicles because of how profitable the market is. This will drive the growth of the electric powertrain market. The growth of vehicle electrification is likely to be sped up by the rising prices of traditional fuels and the rising sales of electric cars. The demand for electric vehicles is likely to grow because of strict emission rules and a growing awareness of the environment among consumers. Also, car companies like Bosch and Renault Group have taken the initiative to implement vehicle electrification and focus on adding electrified vehicles to their product lines, which is expected to increase the demand for vehicle electrification. Over the next few years, all of these things are expected to make the powertrain market grow.

  • Increased Sales of Electric Vehicles Booming the Electric Powertrain Market

The market for hybrid and electric cars is growing quickly, which is a major factor in the growth of the global electric powertrain market. China sells more pure electric vehicles than any other country, making up more than 45 percent of the world market. In 2019, the Chinese market sold 1.1 million electric cars, SUVs, MPVs, and LCVs. In Europe and the Asia-Pacific region, tax breaks and subsidies for both consumers and electric vehicle manufacturers have made the regulatory environment more favorable, which has led to a big increase in sales of electric vehicles. The policies for electric vehicles, which are supported by all levels of government, are based on environmental and sustainability goals. Each country's government is writing up policies that will help the growth of the electric vehicle market in that country.

 

Global Electric Powertrain Market Restraints

  • High Cost of Electrical Components and Technological Challenges with Electric Powertrains can be the Major Restraint for the Market

Even though the total cost of owning an electric vehicle is less than that of a conventional vehicle, the cost to buy an electric vehicle is much higher than that of a combustion vehicle. A Natural Resources Defense Council article says that the average price of an electric passenger vehicle in the US will be USD 19,000 in June 2020, which is more than a gasoline vehicle. Because the prices of these two cars are so different when you first buy them, it is hard for price-conscious customers to choose an electric car. Customers do not want to pay the extra cost for electric cars, even though the total cost of ownership could be low because the cars are used a lot. OEMs around the world find it hard to replace an ICE powertrain with an electric powertrain in passenger vehicles because electric powertrains cost between USD 5,000 and USD 13,000 more than ICE powertrains, depending on the desired range and battery size. In the coming years, this situation is likely to change as more people learn about and understand the overall benefits and low ownership costs of an electric vehicle (EV). But as battery technology gets better and more cars are made, the price difference between these cars is likely to disappear in the next few years.

The main thing holding back the growth of the electric powertrain market is problems with technology, such as low energy and power density, customers' worries about range, and charging batteries. In an electric vehicle, the range is equal to the amount of energy stored in the battery. How fast the vehicle moves depends on how fast the energy in the battery is used up. Manufacturers are in a tough spot because they need to make cars that go faster and have a longer range. Range anxiety comes from the fact that early electric vehicles had much smaller batteries and could not go more than 70 miles on a single charge. Because of this, customers worry that the backup battery might run out in the middle of a trip, and since most countries do not have good charging infrastructure, this could lead to a bad experience. But electric cars have come a long way since they were first made. New lithium-ion batteries that can power a light-duty EV for almost 300 miles on a single charge have come a long way in recent years. 

 

Global Electric Powertrain Market Opportunities 

  • Increased Demand for Electric Vehicles is Creating Huge Opportunities for Market Growth

Electric cars are getting more and more popular, so the biggest car companies are making electric cars. As the market is so profitable, more and more traditional car companies are likely to switch to making electric cars. This will help the electric powertrain market grow. Traditional fuel prices going up and the sales of electric cars going up are likely to speed up the growth of electric vehicles. Because of strict emission rules and more people caring about the environment, the demand for electric vehicles is likely to grow. Also, car companies like Bosch and Renault Group have taken the initiative to implement vehicle electrification and focus on adding electrified vehicles to their product lines. This is likely to increase the demand for vehicle electrification and create a wide range of opportunities in the said domain for manufacturers and startups trying to enter the said industry. 

 

Segmental Analysis of the Electric Powertrain Market

The global electric powertrain market share is segmented by vehicle type and by component. 

With respect to 'by vehicle' segmentation, the BEV segment is the dominant one with a major market share. 

 

By Vehicle

  • BEV 

BEV type leads the vehicle segmentation with a market figure of USD 61 billion in 2021 and growing to USD 782 billion at a CAGR of 33%. This high share is because the sales of ICE vehicles have gone down, and CO2 targets have been tightened. The best way to cut down on pollution and lower the total cost of ownership, in the long run, is for more people to buy BEVs. Also, improvements in battery technology and lower prices for Lithium-ion batteries are likely to increase the demand for BEVs over the next few years.

  • HEV 

The HEV is the second dominant segmentation that accounts for a market share of USD 26 billion in 2021 and is expected to grow to USD 431 billion in 2030 at a CAGR of 37%. The goal of these cars is to improve how the internal combustion engine works with a low-range, High Voltage (HV) electric powertrain. These have an electric motor that is more powerful and a battery that is much bigger and can be charged from an outside source of power. So, they give customers a choice that is flexible and easy to use.

 

By Component

The market is classified into motor, battery, and power electronics components, where the battery segment dominates the market with the maximum market value. 

  • Motor

The motor segment has a market value of USD 7 billion in 2021 and is expected to grow to USD 87 billion by 2030 at a CAGR of 32%. The growing number of BEVs and HEVs around the world is driving the need for e-motors. The electric motors in these vehicles can be set up in the same way. Also, suppliers and OEMs are likely to form joint ventures to develop e-motors to take advantage of the growing demand for electric powertrains.

  • Battery

The battery is the most dominant segment of all the types in the component segmentation, which accumulates a market share of USD 39 billion in 2021 and is growing at USD 502 billion at a CAGR of 33%. The reason behind it is the rise in battery-operated cars that perform at the same level as a gasoline-fueled cars.

  • Power Electronics Component

The Power electronics Component is the least dominant segment that accounts for USD 8 billion in 2021 and is expected to grow to USD 96 billion in 2030 at a CAGR of 32%.

 

Regional Analysis of the Global Electric Powertrain Market

The global electric powertrain market is primarily segmented into three regions, namely- North America, Europe, and Asia-Pacific, where the Asia-Pacific region dominates the market.

Electric Powertrain Market Regional Analysis

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North America

The North American region has a significant market value that stood at USD 11 billion in 2021 and is expected to grow to USD 190 billion by 2030 at a CAGR of 37%. North America is the most developed region, and the presence of major economies like the US and Canada contributes a major share to the growth of the market.

Europe

Europe is the industrial hub of the world, where most of the industries are operating in every industrial sector. Europe accounts for a market share of USD 39 billion in 2021 and is expected to grow to USD 477 billion by 2030 at a CAGR of 32%.

Asia-Pacific

Asia-Pacific is the most dominant region with a market share of USD 36 billion in 2021 and is expected to reach USD 538 billion by 2030 at a CAGR of 35%. The reason behind the region is the most dominant is the presence of emerging economies like India and China that are growing at a rapid pace.

 

Top Market Players

  • Borgwarner Inc
  • Continental AG
  • Magna International Inc
  • Marelli Holdings Co. Ltd
  • Mitsubishi Electric Corporation
  • Nidec Corporation

 

Recent Developments by Key Players

  • In August 2021, Borgwarner Inc. announced a series C equity investment in Cellink Corporation to allow the company expansion in its electrification strategy.
  • In July 2021, Continental AG launched a new product called EMR4 (Electronics Motor Reducer) next-generation electric axle drive.
  • In March 2021, Magna International launched a new product called eBeam technology to provide a smooth electrification transition in vehicles.
  • In September 2020, Marelli Holdings Co. Ltd, signed a Joint Venture with highly International Ltd Hong Kong, to develop an electrification solution for EDS systems.

 

Global Electric Powertrain Market: Segmentation

By Vehicle Type

  • BEV
  • HEV

By Component

  • Motor
  • Battery
  • Power Electronics Controller 

By Region

  • North America
  • Europe 
  • Asia-Pacific
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