The Global Electric Commercial Vehicle Market size is projected to be worth 2,56,06,194 units by 2030, registering a CAGR of 67.08% during the forecast period (2022–2030).
An electric commercial vehicle is either partially or fully powered on electric power instead of diesel or gasoline. Electric commercial vehicles have low running costs as they have fewer moving parts for maintenance and are also very environmental-friendly as they use little or no fossil fuels (petrol or diesel). Over the last few years, the efforts for technological improvements and innovation in transport have been intensified, and fleets of vehicles using renewable sources are the new trend for public authorities, non-profit organizations and many private companies promoting sustainable development.
COVID-19 Impact on the Global Electric Commercial Vehicle Market:
With the continuous spread of the novel coronavirus across the world, automakers are taking extreme measures in the form of plant closures to halt the spread of COVID-19. The situation remains uncertain as more European companies suspend work activities, and the US and APAC automakers extend shutdown periods. In various regions, the countries' governments are applying seemingly ever-more stringent conditions on social interaction, travel, and workplace attendance. These regions are experiencing similar situations, which is having a marked effect on the economy as well as society and causing massive economic disruption, with the automotive industry at the center of this turmoil hampering the growth of global electric commercial vehicle.
Electric Commercial Vehicle Market Dynamics
Electric commercial vehicles reduce the maintenance costs to a significant extent when compared to conventional ICE propelled commercial vehicles as they require less maintenance since they feature fewer moving parts and require fewer fluid changes, thus reducing the cost of servicing and replacement. Engines, transmissions, and exhaust systems are being replaced by maintenance-free brushless induction motors and batteries. This, combined with lower insurance rates due to the higher safety standards of the vehicle, are some of the factors reducing the operating costs of commercial electric vehicles. According to the Georgia Institute of Technology, electric delivery trucks use 30% lesser energy and emit about 40% lesser greenhouse gases than diesel trucks, for about the same total cost, considering both the purchase prices and the operating costs.
The demand for commercial electric vehicles is continuously increasing. However, the maintenance of these vehicles requires a highly skilled workforce, which, along with the relatively unproven electric commercial vehicle technology, are restraining the adoption. Nevertheless, the development of electric commercial vehicles support infrastructure and rapid technological advancements are expected to minimize the effect of these restraining factors. Hence, the impact of the low operating cost of electric commercial vehicles on the global electric commercial vehicle market is expected to shift from low to high over the forecast period.
The growth of the global electric commercial vehicle market primarily depends on the adoption of electric commercial vehicles among medium and large fleet owners. The high price of a commercial electric vehicle and its accessories is the most important factor of concern for fleet owners. The most important concerns of electric commercial vehicle buyers are their battery prices, battery range, and battery life as the current battery capacity of the heavy-duty commercial vehicle falls short of the requirements for long-haul trucking applications, which prevents the use of electric commercial vehicles outside fixed regional routes.
Although battery prices have been declining in recent years, electric commercial vehicle manufacturers are still struggling to make an affordable and dependable alternative for ICE commercial vehicles in most applications. The need to replace the battery within a span of one to two years also restricts the adoption of electric commercial vehicles. Additionally, their long charging time, safety, and security concerns regarding battery explosion in extreme weather and operating conditions have also been restricting the adoption of electric commercial vehicle market.
Logistics companies are facing an era of unprecedented change as digitization takes hold and customer expectations evolve. New advanced technologies are enabling greater efficiency and more collaborative operating models. Thus, it is anticipated to be a driving factor for the electric commercial vehicle market. The growth in e-commerce has resulted in a higher volume of low-value shipments. In response, retailers are increasingly decentralizing their distribution centers and establishing the “last-mile” fulfillment centers to keep inventory closer to consumers. This increases the demand for electric commercial vehicles for transporting the inventory to the closer distribution centers with zero emissions. For instance, in 2020, AB Volvo signed a contract with a third-party supply chain solutions provider NFI Industries, to successfully supply its VNR Electric heavy-duty trucks to transport freight under various operating conditions.
This shows the increasing logistic activities and the demand for electric commercial vehicles to fulfill these logistic activities. Thus, the increasing logistic activities are expected to create lucrative opportunities for the players operating in the global electric commercial vehicle market.
Electric Commercial Vehicle Market Supply Chain Analysis
In the design and development stage, the dimensions, technology, working conditions, battery capacity, driving range, commercial vehicle type, charging time, and applications of the electric commercial vehicles are analyzed to design and develop a commercial electric vehicle that fulfills the requirements of the customers. In the design stage, the overall layout, components, material type, size, and shape of the vehicle are determined according to their application and the specific requirements of the end users. After finalizing the design, the various raw materials, such as plastics, rubber, iron, special fibers, steel, aluminum, and glass, are selected. Some of the components required for manufacturing an electric commercial vehicle are battery, seats, windshield, dashboard, tires, motor, headlights, interiors, and wiring harness. An uninterrupted supply of high-quality raw materials and components in the required quantity not only warrants the longevity of the final products but also affects their efficiency.
After procuring the necessary raw material and components, the OEM assemble the electric commercial vehicle according to the design, which was finalized by keeping in mind the customer’s requirements. After the assembly stage is completed, the finished electric commercial vehicles undergo certain quality checks to ensure that they comply with the required performance standards and work with precision and efficiency in actual working conditions. After the assembly stage is completed, the finished products are sent to various distributors and suppliers, such as independent dealers and company dealers who work as channels to provide the final electric commercial vehicles to the end users. The primary end users in the global electric commercial vehicle market are individual buyers, fleet owners, logistics service providers, and government organizations. The end user purchases electric commercial vehicles from dealers.
Electric Commercial Vehicle Market Segmentation
Based on technology:
Battery Electric Vehicle (BEV), Plug-in hybrid electric vehicles (PHEV), Fuel cell electric vehicles (FCEV) are the segments based on the technology of the Global Electric Commercial Vehicle Market. The BEV segment is expected to have the highest CAGR and dominate the market share during the forecast period. Battery electric vehicles (BEVs) generally use chemical energy, which is stored in rechargeable battery packs. The battery-powered electric commercial vehicles use motor controllers and electric controllers instead of using internal combustion engines and get the power from battery packs.
Based on vehicle type:
Electric bus, electric truck, electric pick-up truck, and electric van are the segments based on the vehicle type of the Global Electric Commercial Vehicle Market. The electric van segment is expected to have the highest CAGR and dominate the market share during the forecast period. Electric vans produce no CO2 or NOx emissions, which means their widespread adoption has the potential to improve air quality, especially in urban areas. These vans are much quieter than diesel vans, but electric vans will not travel as far on a single charge as conventional vans will on a single tank of fuel.
Electric Commercial Vehicle Market Regional Analysis
The regions are classified as North America, Europe, Asia-Pacific, Middle East & Africa, and Rest of the World. Asia-Pacific holds a significant share of the market. The demand for commercial electric vehicles in Asia-Pacific is expected to grow significantly due to the growing demand for electric buses and the initiatives to promote the development of electric vehicles taken by the governments of countries such as China, Japan, and India. The rising demand for the development of charging infrastructure and increasing collaborations between the automotive OEMs in the region results in the market's growth in this region. For instance, in China, in March 2020, BYD (China) signed an agreement with Transcarsell, a heavy-duty transport company, to supply electric trucks equipped with lithium iron phosphate batteries. Additionally, the government authorities in the countries in Asia-Pacific are making efforts to develop charging infrastructure through policies, incentives, and schemes to attract automotive manufacturing companies in the region. This leads to an increase in the demand for charging stations to ease the operation of electric buses in Japan. Such factors are expected to drive the market's growth for electric commercial vehicles in Asia-Pacific during the forecast period.
Truck driving is one of the fastest-growing occupations in North America. According to the US Bureau of Labor Statistics, there were more than 1.8 million heavy-duty and tractor-trailer truck driving jobs in 2019-2020. Overall, a total of 7.4 million citizens in the US have jobs that are tied to the trucking industry. According to the American Trucking Associations, trucking moves 71% of all the freight in America. Nearly 6% of all the full-time jobs in the country originate in the trucking industry. In recent years, Walmart (US) has been turning away from third-party contracts and employing its truckers, which resulted in a hiring surge of more new truck drivers. Thus, the demand for electric trucks in the US is expected to increase as more people are looking at truck driving as a full-time profession in the US during the forecast period. Thus, the initiatives taken by the government result in increasing the installation of electric vehicle charging stations, which will propel the sale of electric commercial vehicles across the country during the forecast period. Such factors are expected to drive the growth of the electric commercial vehicle market in North America during the study period.
Electric Commercial Vehicle Market Competitive Landscape
The global electric commercial vehicle market is characterized by the presence of many local, regional, and global vendors. The market is highly competitive, with all the players continually competing to gain a larger market share. High competition, rapid advances in technology, frequent changes in government policies, and stringent environmental regulations are some of the critical factors that could restrain market growth. The vendors compete in terms of cost, product quality, reliability, and aftermarket services. Vendors must provide cost-effective and efficient products to survive and succeed in a competitive market environment.
List of Key Companies covered in the report:
Electric Commercial Vehicle Market Report Overview:
The Global Electric Commercial Vehicle Market is segmented based on technology and vehicle type in this report. The report is focused on various analytical aspects such as market dynamics, Supply chain analysis, Porter’s five forces, competitive landscape, recent developments, and company profiles. The insights in this report, comprise, discuss views, and predict the emerging and fast-growing segments, regions, and countries with potential for development in the Global Electric Commercial Vehicle Market.
Objectives of the Study
|Market Size||2030: 2,56,06,194 units|
|Historical Data||2019 & 2020|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, and Trends|
|Segments Covered||By Technology, By Application, By Vehicle type, By Component ,|
|Geographies Covered||North America, Europe, Asia-Pacific, Rest of the World|
|Key Vendors||AB Volvo (Sweden), Tesla (US), Daimler AG (Germany), PACCAR Inc. (US), BYD Company Limited (China), Proterra (US), Scania (Sweden), VDL (Netherlands), CAF (Spain), KING LONG (China), Renault Trucks (France), Yutong (China), NFI Group Inc. (Canada), EBUSCO (Netherlands), Anhui Ankai Automobile Co., Ltd. (China)|
|Key Market Opportunities||Increasing logistics activities|
|Key Market Drivers||Government initiatives to encourage adoption of electric commercial vehicle Low operating cost|
The Global Electric Commercial Vehicle Market would register a growth of ~67.08% during the forecast period.
Underdeveloped charging infrastructure and poor aftermarket services are key restraining factors for the Global Electric Commercial Vehicle Market
Asia-Pacific would enjoy the upper hand in the Global Electric Commercial Vehicle Market
Shell, Siemens, Tesla, Schneider Electric, ABB, Webasto, Hyundai Motor Company, ChargePoint, etc. are the major suppliers of Commercial Electric Vehicle Charging Stations