The market for electric vehicle traction motors was valued at USD 5.5 billion in 2021, and it is expected to grow to USD 87.60 billion by 2030 at a CAGR of 41.34%. An Electric Vehicle Traction Motor is a motor installed in an Electric Vehicle. It gets its power to move the vehicle forward from the battery also installed in it. Traction motors can propel electric vehicles efficiently because they supply the necessary torque.
Since the traction motor is such an essential part of electric vehicles, the ever-increasing demand is directly responsible for expanding the market for electric vehicle traction motors. The demand for electric vehicles is increasing due to several factors, including contentious pollution requirements, a rise in demand for electric vehicles, and substantial incentives granted by governing bodies for purchasing electric vehicles. Infrastructure for charging electric vehicles is rapidly developing, as is the price of electric vehicles as battery prices continue to fall. Ultra-fast chargers are also becoming more widely available, and the claimed ban on fuel-powered vehicles is driving demand for electric vehicles.
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Electric Vehicle adoption is surging the demand for EV Traction Motor
According to the International Organization of Motor Vehicle Manufacturers (OICA), around 16% of the world's artificial carbon dioxide emissions are caused by road transportation. On a regional level, these statistics vary greatly. For instance, road transportation accounts for 72% of these emissions in the EU, while it accounts for only 29% in the US. Naturally, both automakers and customers are looking for cleaner substitutes.
As a result, the global market for electric vehicles has experienced tremendous growth. The International Energy Agency's data analysis shows that, despite supply shocks brought on by the COVID-19 epidemic, the market for electric cars increased by 40% in 2020. According to the data, a record 3 million new electric automobiles were registered. The traditional vehicle industry had a 16 per cent decline over the same fiscal year.
The number of EVs on the road worldwide as of 2019 was over 10 million, with an additional 1 million or so electric vans, large vehicles, and buses. These trends are only expected to intensify, creating a significant opportunity for the market for EV traction motors to expand.
Government Support Programs Improve Prospects for EV Traction Motor Manufacturing
All the governments are implementing a variety of measures to reduce automotive emissions as worries about them proliferate. In addition to financial support from budgetary allocations and stimulus measures, adopting strict emission regulating criteria provides momentum for well-known firms.
As an illustration, the Indian government has developed a strategy to reduce emission intensity by 33–35 per cent starting in 2030 in compliance with the COP21 Summit conducted in Paris. The National Electric Mobility Mission Plan 2020 (NEMMP), announced by the Department of Heavy Industry in 2013, included an investment of Rs. 14,000 crores (US$ 1.8 billion) for building EV infrastructure. It was supplemented by the 2015 Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme, which had an investment of Rs. 795 crores (US$ 106 million).
Similarly, the Fixing America's Surface Transportation (FAST) Act, passed in 2015, created the 5th round of designations for Alternative Fuel Corridors, which was held in April 2021 by the US Department of Transportation. For 51 interstates and 50 highways, 25 states submitted nominations. These measures have significantly increased the prospects for EV traction motors globally.
The price of electric vehicles is the main barrier to the market's expansion for electric vehicle traction motors
The cost of electric vehicles is high because they are a new technology. The fact that most consumers with lower incomes cannot purchase electric vehicles is expected to impede the growth of the market for electric vehicle traction motors. Additionally, the technology used to charge the batteries in these vehicles is subpar. The main issue for the electric vehicle traction motor market in the forecast period is the absence of recharging infrastructure in many countries.
The global electric vehicle traction motor market is segmented into four parts based on vehicle type, power, application and region. Further, the market is bifurcated into Battery Electric Vehicle and Plug-in Hybrid Electric Vehicle. The battery-electric vehicle sub-segment dominates the market and is expected to expand at a CAGR of 39.6% during the forecast period. The expansion of this sub-segment is due to the rising demand for battery electric vehicles due to their energy density, safety, and peak power capability.
Based on power, the market is divided into Below 200 kW, 200-400 kW, and Above 400 kW.
The market is divided into Electric vehicles, Elevators, Conveyors and Industrial Machinery based on application.
According to the region, the market is divided into North America, Europe, Asia-Pacific, Latin America and the Middle East & Africa. The Asia-Pacific region is expected to lead the market.
According to the region, the market is divided into North America, Europe, Asia-Pacific, Latin America and the Middle East & Africa.
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The Asia-Pacific region is anticipated to take the lead in the global market for electric traction systems, which is also anticipated to be an optimistic indicator for the region to continue its dominance throughout the upcoming year. The global market for electric traction systems is anticipated to see a boost in this region due to the increasing transportation infrastructure development. It includes the development of railway connections, hybrid electric vehicles, high-speed bullet trains, and metro rail systems. During the forecast period, an increase in demand for rolling equipment for narrow gauge and industrial railways, including diesel-electric, hybrid, and electric locomotives, is anticipated to contribute a significant portion of the market share by positively impacting the development of electric traction systems.
During the estimation period, it is anticipated that the market for electric vehicle traction motors will expand at a CAGR of 42.3% in the North American region. It is mainly attributable to the fact that a significant number of electric vehicle manufacturers are located in various parts of the world. A further factor anticipated to boost the regional growth of the market over the forecast period is the expansion of government legislation designed to reduce the number of pollutants produced by vehicles.