Electric Powertrain Market To Surpass USD 304.03 Billion By 2031 Driven By Rising Growing Demand For Electric Vehicles


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The E lectric P owertrain M arket is experiencing a period of immense growth, fueled by a confluence of factors. Stringent environmental regulations, coupled with government incentives for electric vehicle (EV) adoption, are driving consumer preference towards cleaner and more sustainable transportation solutions. Technological advancements in battery technology are further enhancing the range and efficiency of electric vehicles, making them a more compelling proposition for consumers.

The Electric Powertrain Market, valued at USD 96 Billion in 2023, is anticipated to reach a staggering USD 304.03 Billion by 2031. This exponential growth signifies a compound annual growth rate (CAGR) of 15.5% throughout the forecast period.


Electric Powertrain Market To Surpass USD 304.03 Billion By 2031 Driven By Rising Growing Demand For Electric Vehicles Image

Electric Powertrain Market

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Top Key Players of Market

  • ZF Friedrichshafen AG (Germany)
  • Robert Bosch GmbH (Germany)
  • BorgWarner Inc. (US)
  • Mitsubishi Electric Corp (Japan)
  • Magna International Inc. (Canada)
  • Continental AG (Germany)
  • Valeo
  • Magneti Marelli Ck Holdings
  • Nidec Corporation
  • Schaeffler AG

The Age Of Gasoline-Powered Cars Is Nearing Its End, And A New Era Of Electric Vehicles (Evs) Is Dawning

EVs are rapidly gaining popularity due to their eco-friendly nature and surprisingly lower overall ownership cost compared to traditional internal combustion engine (ICE) vehicles. Governments around the world are pushing for a cleaner future by enacting stricter regulations and promoting alternative fuel options, with EVs at the forefront.

The Past Decade Has Seen A Dramatic Shift In The Automotive Industry

Once dominated by the roar of the gasoline engine, car manufacturers are now offering a diverse range of powertrains, all striving for better fuel efficiency and a reduced environmental impact. This transformation includes a growing presence of pure electric and hybrid options, making the powertrain landscape more dynamic and complex than ever before.

Stringent regulations aimed at curbing CO2 emissions are driving the demand for EVs in places like Europe and North America. For example, Europe has set ambitious emission targets, aiming for a significant reduction by 2030. Similarly, North America has established strict emission limits for passenger vehicles. To avoid hefty penalties, car manufacturers (OEMs) are strategically increasing their production and sales of electric vehicles in the coming years.

Market Segment Analysis

By Vehicle Type

  • BEV
  • HEV/PHEV

By Components

  • Motor/Generator
  • Converter
  • Battery
  • Transmission
  • Power Electronics Controller
  • On-Board Charger

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Technological Breakthroughs In Battery Technology Have Been A Game-Changer For Evs

These advancements have led to a significant increase in the range that EVs can travel on a single charge, making them a much more practical choice for everyday drivers. Batteries are a crucial component of electric powertrains and represent a significant portion of an electric car's cost. However, advancements in battery technology, coupled with more efficient production processes and economies of scale, have led to a substantial decrease in battery costs. As battery prices are expected to continue dropping in the coming years, EVs are anticipated to reach“Total Cost of Ownership (TCO) parity” with ICE vehicles, paving the way for widespread adoption by the mass market.

Electric Vehicles Powering Up the Electric Powertrain Market

Declining battery prices are making electric vehicles (EVs) a more attractive option for consumers. Advancements in battery technology are leading to improved storage capacity and longer driving range on a single charge, addressing a major concern for potential EV buyers.

A growing environmental consciousness is leading to a shift in consumer preferences towards sustainable transportation solutions. EVs offer a cleaner alternative to traditional gasoline-powered vehicles.

This shift towards electric mobility is particularly evident in the transportation sector, the second-largest source of global emissions after electricity generation.

Governments Take Charge

Governments around the world are actively promoting electric vehicle adoption by implementing stricter regulations on CO2 emissions is pushing automotive manufacturers to develop and sell more EVs.

Providing subsidies and tax breaks for both the EV industry and consumers in regions like Europe and Asia Pacific makes EVs more financially viable.

Ambitious Goals and Industry Response

Major automotive markets like China and India have set ambitious goals to completely phase out traditional fuel vehicles by 2030.

Automakers are ramping up investments in research and development of electric vehicles to meet the anticipated surge in demand for electric cars in the coming decade.

A prime example is Volvo Trucks Malaysia's introduction of the region's first fully electric Heavy Duty Prime Mover. These models demonstrate the potential of electric powertrains, offering extended range and high torque to cater to the needs of the commercial transportation sector.

Recent Developments Shaping the Market

April 2023: Modern Automotives , an Indian company, became the first to receive approval for supplying Differential Pinion Shafts to electric powertrain giant BMW AG Munich. This landmark deal entails delivering 2.5 million units by 2034, reflecting the growing global integration within the electric vehicle supply chain.

July 2023: The all new, performance version of the Mercedes Benz GLC AMG has been launched. This development is a reminder of the continuing progress in electrical propulsion technologies, which are increasingly capable of providing high performance for electricity vehicles.

Component Insights

The battery segment dominated the market in 2023, capturing a staggering 65% share. Batteries are the cornerstone of vehicle electrification, serving as the sole power source in BEVs or working in conjunction with other power sources in hybrid electric vehicles (HEVs). In BEVs, battery packs can account for nearly half of the total vehicle cost. The surging demand for electric vehicles, coupled with advancements in battery technology and supportive government policies, are fueling significant growth in this segment.

Electric Vehicle Insights

The BEV segment held the largest market share, accounting for approximately 71% of the overall market in 2023. A BEV is an electric vehicle that relies solely on electric energy for propulsion. Unlike traditional ICE vehicles, BEVs have no internal combustion engine or fuel tank and operate on an electric drivetrain powered by rechargeable batteries. BEVs require charging at a dedicated power source. The dominance of BEVs can be attributed to the declining sales of ICE vehicles and stricter limitations on CO2 emissions. Additionally, advancements in battery technology and the decreasing cost of Lithium-ion batteries are expected to further propel BEV demand throughout the forecast period.

The Asia Pacific Region Captured The Largest Revenue Share, Exceeding 60% In 2023

Stringent government regulations and emission norms are driving the adoption of electric vehicles in the region to combat air pollution and reduce reliance on fossil fuels. Several prominent automobile manufacturers, including companies from China, Japan, South Korea, and India, are located in the Asia Pacific region. These companies are heavily investing in EV development and production, fueling market growth.

Countries like China are actively developing their electric vehicle charging infrastructure to address range anxiety and encourage EV adoption.

Several Asia Pacific countries, particularly China and India, are witnessing a surge in EV adoption due to increasing consumer awareness and government incentives.

Key Takeaways for Your Electric Powertrain Market Study

  • Gain a clear understanding of the market size, growth projections, and key segments driving the electric powertrain market.
  • Identify the factors propelling market growth, such as technological advancements, government support, and consumer preference, alongside potential challenges like supply chain disruptions and economic slowdowns.
  • Explore the dynamics of the electric powertrain market across key regions, including Asia Pacific, Europe, and North America.
  • Gain insights into the strategies of key players in the electric powertrain market, including OEMs, battery manufacturers, and component suppliers.
  • Benefit from expert forecasts on the future trajectory of the electric powertrain market and gain valuable insights to inform your business decisions.

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