Electric Vehicle Market Size, Share, and Trends 2024 to 2034

The global electric vehicle market size was estimated at USD 255.54 billion in 2023 and is projected to hit around USD 2,108.80 billion by 2033 with a notable compound annual growth rate (CAGR) of 23.42% from 2024 to 2033. Electric vehicle sales have increased from 67,68,000 in 2021 to 1,05,22,000 in 2022.

The growing funding and investments by key market players drive the electric vehicle market growth. Ford had previously stated that it would invest $11.5 billion in electrifying its vehicle lineup between now and 2022. It recently claimed that it had upped its spending on driverless and electrified vehicles to help boost vehicle sales in the face of ongoing lockdowns. Mercedes-Benz also confirmed that it will release 25 new plug-in hybrid electric vehicles and entirely electric cars by 2025. Companies' diverse product offers have attracted many customers, resulting in an expanding market for electric vehicles.

Key Takeaway

• Asia Pacific has dominated the market with a 42.14% revenue share in 2023.
• The Asia Pacific EV market was valued at USD 107.68 billion in 2023.
• By propulsion type, BEV accounted largest revenue share 67.7% in 2023.
• By vehicle type, the passenger car segment accounted for 62.4% of revenue share in 2023.
• EV sales increased by 80% in the United States in 2019.
• By 2040, Europe is expected to achieve 40% greenhouse gas reduction and net zero by 2050.
• In Europe, Norway and Iceland have newly registered 86% and 64% electric cars in 2021 respectively.
• The hybrid electric vehicle segment is expected to reach USD 301.67 billion by 2030 valued at USD 77,581.7 million in 2021.
• The plug-in hybrid EV segment is expected to hit revenue of USD 385,617 million from 2022 to 2030.
• The passenger car electric vehicle market was valued at USD 127,394 million in 2021 and is projected to hit USD 598,735 million by 2030. 
• The commercial vehicle EV market was valued at USD 47,351.9 million in 2021.
• The luxury EV market is projected to reach USD 441,273 million by 2030 valued at USD 104,380 million in 2021.

Electric Vehicle Market in the Asia Pacific 2024 to 2033

The Asia Pacific electric vehicle market size was valued at USD 107.68 billion in 2023 and is anticipated to reach around USD 917.33 billion by 2033, poised to grow at a CAGR of 23.82% from 2024 to 2033.

Geographically, the Asia Pacific region dominated the EV market in 2023 and is anticipated to have the highest CAGR of all the geographies during the forecast period. According to estimates, China will hold the most outstanding market share for electric vehicles in the Asia-Pacific region in 2023, followed by India and Japan. The significant market share of China is primarily attributable to the country's extensive government support and expansion of the infrastructure for charging electric vehicles, improvements in the quality of electric vehicles, and an increase in the number of charging stations.

Asia Pacific is home to most EV battery manufacturers, including China, South Korea, and Japan. The dominance of the battery industry is increasing in China. Chinese manufacturers like CATL and BYD have increased and widened their global market shares due to the government's extensive investments and encouraging regulations.

Furthermore, many people can now afford to own cars because of China's robust economic expansion. As a result, there has been an increase in mobility, the significant automobile market in the world. Still, there has also been a substantial increase in urban air pollution, greenhouse gas emissions, and dependence on imported oil.

China is the primary electric vehicle market globally, accounting for nearly half, i.e., 45% of the global electric vehicle sale. Other countries such as Japan, Korea, and India are also opportunistic markets as the governments of these countries are significantly investing in EV startups to promote the manufacturing and sale of EVs across the globe. In July 2019, the Japanese firm Mitsui & Co. invested USD 13.3 million in an Indian e-Vehicle startup, SmartE. The investment would help SmartE to bring multiple synergies in the global EV market for its long-term growth. Similarly, in June 2019, Toyota Motor Corp. invested USD 2 Bn to develop electric vehicles in Indonesia.

Furthermore, the Indian government's involvement in building a charging infrastructure is also boosting the Asia Pacific EV market. For instance, the FAME II initiative in India provides funding of up to USD 135 million to stimulate investment in EVSE for electric buses. This should pay for one low-power charger and one rapid charger for every ten buses. Thus, the market for electric vehicles in the Asia Pacific area is expanding due to the factors mentioned above.

The governments of developing and developed nations are providing subsidies to market players, and stringent regulations are driving the growth of the electric vehicle market in the Asia-Pacific region. China's Ministry of Transport provides grants and other incentives for developing low-emission bus fleets, affecting the market even more favorably. Despite the COVID-19 outbreak, Chinese bus manufacturers sold 61,000 additional new energy buses in 2020.

Europe and North America witness substantial growth in the global electric vehicle market. This is attributed to the increasing demand for electric vehicles in the U.S., Norway, France, and Germany. Germany and Norway are the leading markets in the European region, witnessing a CAGR of nearly 40%. Moreover, to promote electric vehicles in North America, policymakers, automotive manufacturers, and charging network companies have launched a non-profit organization called ‘Veloz.’ The organization aimed to attract innovation, investment, marketing, and growth in the electric vehicles market. Electrify America, a U.S.-based electric vehicle manufacturer, announced to invest of USD 2 Bn in Zero Emission Vehicle (ZEV) infrastructure across the U.S. over ten years from 2017 to 2027, out of which USD 800 Mn was invested in California, one of the largest ZEV markets across the world.

The upsurge in the growth of the electric vehicles market in the European region is highly attributed to the harmonious developments in implementing strict emigration regulations by the European Union and adding a focus on reducing the number of conventional buses. Norway leads the way for electric mobility relinquishment in Europe. The share of battery electric vehicles in new auto deals rose to 54.3% in 2020, which is anticipated to surpass 65% of the market share in 2021.

The U.S. is dominating the electric vehicle market in the North American region, and the rising demand for electric automobiles in the U.S. accounts for this proportion. In addition, Electrify America, a non-profit organization dedicated to promoting electric vehicle adoption, announced intentions to invest $200.0 million in California in 2018. As a result, demand for electric vehicles in North America is expected to rise over the projection period.

Growth Factors

A significant number of initiatives taken by the government of various countries, such as tax rebates, subsidies & grants, and other non-financial benefits in car registration and access to carpool lanes expected to drive the sale of electric vehicles in the coming years. For instance, in November 2019, German car manufacturers raised their cash incentives for electric cars to move away from the transition from combustion engines to battery-powered engines to reduce harmful emissions. Countries such as the U.S., China, and different countries in Europe, have registered significant growth in the sale of electric vehicles in the past few decades that, in turn, will contribute to the market growth.

However, lack of charging infrastructure, variations in setting load & lack of standardization are some significant factors hindering the market growth. Different regions, such as China, Europe, the U.S., Japan, Korea, and others, have different standards for electric vehicle charging. Some electric vehicle manufacturers, such as Tesla Inc., are focusing on global standardization of charging infrastructure to overcome this drawback. Nevertheless, the rising adoption of electric vehicles in government and commercial sectors is anticipated to drive the market. For instance, in 2020, the U.K. government approved 200 electric buses with an ambition to make all buses fully electric by 2025, which could save nearly 7,400 tonnes of CO2 every year.

• Increase in demand for fuel-effective, high- performance, & low- emigration vehicles
• Strict government rules & regulations toward vehicle emigration along with reduction in cost of electric vehicle batteries and adding fuel costs
• Lack of high manufacturing cost, charging structure, and range serviceability and anxiety

The market of electric vehicles is likely to be affected positively by the recent trend of self-driving trucks. Furthermore, the top OEMs, similar to Volvo, Daimler Vera, and Tesla, are among others that have been developing automatic-driving electric vehicles for the market. Therefore, technology regarding self-driving will surge the demand for electric cars, in the long run, owing to the colorful advantages of decreased accident threat, easy use, and presence of value-added features. This technology is anticipated to develop in the coming 5-6 times. Therefore, the growth of self-driving electric vehicle technology will likely bring growth opportunities for the market in the forthcoming period.

Electric Vehicle Market Scope

Electric Vehicle Market Dynamics

Drivers

Decrease in the Cost of EVs:

The price of battery packs, that account for a sizeable portion of the manufacturing costs of electric vehicles, has decreased over time. The average price of lithium-ion battery packs dropped abruptly by 89% from $1,200 per kWh to $132 per kWh (by 2021) over a decade. This price is near the $100 per kWh threshold that would allow electric vehicles to be priced similarly to those with internal combustion engines. In addition, the average price of new cars increased by 2.2% between 2020 and 2021, whereas the cost of EVs fell by 10.8%. The future of internal combustion engine (ICE) cars and their electric competitors are both vividly indicated by this electrification trend. Due to this, EV usage has expanded globally. As a result of the price decline, the market for electric vehicles is anticipated to increase in the near future.

Growing government initiatives

Governments are spending a lot on incentives and subsidies to persuade people to buy electric cars. Governments worldwide are taking initiatives likely to boost demand for electric vehicles in the coming decade. Electric vehicles have been regulated in developing countries, and fuel economy criteria have been established in all countries. In addition, they offer incentives and subsidies to electric vehicle makers and buyers. Thus, this factor is driving the market growth. 

Restraints

Lack of Universal Charger and Ecosystem: 

Setting up a proper charging environment is increasingly difficult because every second electric vehicle manufacturing firm has a unique charging outlet. Likewise, many EV owners worry about getting into moral difficulty for charging their cars at various EV manufacturers' charging stations, which could impact the EV industry's expansion. Lack of standardization is a barrier for the electric car sector since it affects the market's present and future. No single charging station can be installed to charge all electric vehicles, so every second electric scooter has a unique charging outlet. This has an impact on the infrastructure of charging stations. Additionally, the population's EV adoption rate is lowered by the need for more standardization. 

Lack of standardization

The non-presence of standardization among nations may affect charging station connections and hinder market expansion. Using several charging standards worldwide creates a hurdle to harmonizing electric vehicle charging stations. Standardizing charging points would make it easier to set up electric cars in public and contribute to a faster increase in electric vehicle demand worldwide. As a result, the lack of standardization restricts the market's growth. 

Opportunities

Increasing Investment by the Government in Charging Infrastructure for Heavy Duty Vehicles (HDVs):

Globally, government bodies are taking the initiative to improve strategies and programs to develop rapid charging infrastructure. Several investments are taking place worldwide to expand commercial charging to support HDVs. For instance, through direct investment, California and a few other US regions are promoting the construction of the infrastructure needed for electric HDVs. The largest hydrogen refueling network in North America has been supported by the California Energy Commission (CEC) with more than USD 125 million for 62 public stations as part of the state's ambition to establish 200 stations by 2025. Investments have been primarily focused exclusively on LDV refueling infrastructure till 2020. A plan to allocate up to USD 115 million more for hydrogen refueling infrastructure, including fueling for medium- and heavy-duty trucks, was approved later in December 2020. Thus, these initiatives by the government will create lucrative opportunities for the electric vehicle industry.

Declining costs of electric vehicle batteries

Due to technological breakthroughs and the mass production of electric vehicle batteries in huge quantities, the cost of electric vehicle batteries has decreased over the last decade. Because electric vehicle batteries are one of the car's most expensive components, this has reduced the cost of electric vehicles.

Challenges

Lack of charging infrastructure

• There are few electric vehicles charging facilities in many places around the world. As a result, public electric vehicle charging stations for electric cars are becoming less available, lowering uptake. Electric vehicle charging infrastructure is being installed in many countries. However, most countries, except a few states, have yet to be able to establish the requisite number of charging stations. 

COVID-19 Impact Analysis:

• The COVID-19 pandemic has had an adverse effect over electric vehicle industry. 
• The registration of all types of electric vehicles during the year 2021 dropped by more than 20%as compared with the number of new EV registrations in the year 2020. 
• During the pandemic various players are trying to implement different approaches in order to survive the condition by using electric vehicles for product supplies as it provides inexpensive transportation with excellent maneuverability. 

Propulsion Type Insights

Battery Electric Vehicles (BEV) led the global market and accounted for more than 67.7% of the overall revenue share in 2023. The significant growth of the BEV is mainly due to the potential benefits offered, such as control over greenhouse gas (GHG) emissions, energy security concerns, and control over local pollutants. This can be due to people's growing awareness of the environment and the benefits of battery electric vehicles. The potential benefits of the BEV, including reducing local pollution, energy security issues, and greenhouse gas (GHG) emissions, are primarily responsible for its rapid expansion. This results in people being more conscious of the environment and the advantages of battery-powered cars. In addition, compared to PHEV, the expense of a BEV is more considerable. As a result, battery electric vehicles rule the electric vehicle market.

Moreover, the cost associated with BEV is more significant compared to the PHEV. The PHEV is expected to witness the fastest CAGR of around 43.5% owing to numerous benefits over BEV; some are low battery cost with smaller battery size and more extended driving range as they are equipped with liquid fuel tanks and internal combustion engines. Additionally, many EV manufacturers such as Volkswagen Group and General Motors are focusing on multi-platform technology with extensive attention towards PHEVs as they can be refueled at any gas station. At the same time, BEVs can only be charged at public charging stations, and public charging spots are far between and very few in the city. Thus, PHEV offers flexibility and freedom to drivers. In January 2020, Volkswagen AG increased its plug-in electric car sales by 60%, from nearly 50,000 to over 80,000 in 2019.

The fuel cell electric vehicles segment is anticipated to grow at the loftiest CAGR during the cast period. This segment's rapid-fire growth is substantially attributed to the adding demand for vehicles with low carbon emigrations, strict carbon emigration morals, and growing emphasis on the relinquishment of FCEVs owing to benefits associated with fast refueling adding government enterprise and investments for advancing fuel cell technology.

Vehicle Type Insights

Based on vehicle type, the electric vehicles market is segmented into heavy commercial vehicles, passenger vehicles, e-scooters & bikes, two-wheelers, and light commercial vehicles. With the most significant revenue share in 2023, the passenger vehicle segment dominated the electric vehicle market, and this is because governments in several nations strongly support electric passenger cars.

During the forecast period, the category for light commercial vehicles is expected to increase at the highest CAGR. The spike in demand for electric cars to minimize line emigrations, strict government rules and regulations governing vehicle emigration, and growing consumer awareness of electric vehicles' role in decreasing emigration are all significant contributors to this segment's exponential growth rise. This segment's rapid-fire growth is substantially attributed to the growing consumer awareness regarding the part of electric vehicles in reducing emigration, the surge in demand for electric cars to reduce line emigrations, and strict government rules and regulations towards vehicle emigration.

V2G Insights

The V2X sector had the highest market share in 2023. The demand for V2Xs is rising due to rising environmental pollution concerns and rising connected car trends. There will be more chances for the V2X in the EV sector due to improvements in 5G technology and advances linked to autonomous vehicles. Governments from different countries have also engaged in a variety of V2X-related initiatives. As an illustration, the US government recently launched several programs to advance V2X technology by 2022. Therefore, it is anticipated that the V2X category will experience significant expansion during the following years. 

End-Use Insights

Based on end use, the electric vehicle market is segmented into private, commercial, and industrial use. The commercial use segment will likely grow at the loftiest CAGR during the forthcoming period. This segment's high growth is credited to the rise in fuel prices and strict emigration morals set by governments, the growing relinquishment of independent delivery vehicles, and the adding relinquishment of electric motorcars and cars.

The rapid expansion of this segment can be attributed to rising fuel prices and government-imposed severe emigration morality, the growing relinquishment of independent delivery vehicles, and the increasing relinquishment of electric motorcars and cars.

Key Developments

• In January 2023, the UK government achieved its goal of converting over a quarter of all of its automobiles (25.5%) to ultra-low emission vehicles, and is now moving forward with decarbonizing its central car fleet (ULEV).
• In January 2023, MG unveiled new small electric car concept at the biennial Auto Expo in India.
• In January 2023, the UK government achieved its goal of converting over a quarter of all of its automobiles (25.5%) to ultra-low emission vehicles, and is now moving forward with decarbonizing its central car fleet (ULEV).
• In January 2023, MG unveiled new small electric car concept at the biennial Auto Expo in India.
• BMW will debut its new i4 electric vehicle in November 2021, with a range of 300-367 miles. In just four seconds, the car can reach 100 km/h. It has an automatic transmission and is equipped with linked car capabilities.
• In April 2021, the key player named Toyota introduced the new Mirai & LS models in the city japan which come with the technology of advanced driving assessment.
• In April 2021, the key player named BYD introduced four new electric vehicle models which were equipped with Blade batteries in Chongqing. The new vehicle models, Qin plus EV, E2 2021 Tang EV, and Song plus EV came with the advanced feature of battery safety.
• In April 2021, the key player named Volkswagen reviled the 7 seater ID.6 X and EV ID.6 Crozz manufactured along with SAIC and FAW in China. Furthermore, these vehicles be sold in China only. Also, it comprises of 2 versions of battery, as 77 kWh & 58 kWh and comes in four powertrain configurations.
• Tesla, Inc. declared the acquisition of Maxwell Technologies, Inc. in March 2019. The purchase was made with the goal of improving Tesla's batteries and lowering overall costs in order to obtain a competitive edge in the market.
• The Nissan Motor Company has surpassed 180,000 consumers, which is the most significant milestone in the LEAF's launch. The latest vehicle from this business is the Ariya, an electric crossover coupe.

Electric Vehicle Market Companies & Market Share Insights

The global electric vehicle market is consolidated with high competition owing to the presence of many market players. The existing players are significantly focused on innovation and developing new models and technology to overcome the drawbacks and strengthen their roots in the global market. Some market players also invest in EV startups to boost their regional presence. In December 2019, an electric vehicle startup, Rivian, raised USD 1.3 billion in funds from Amazon.com Inc. and U.S. based automaker Ford Motor Co.

Furthermore, rising initiatives from governments of several regions towards environmental depletion from CO2 emission have forced automakers to switch towards battery-powered or electric vehicles. Merger, acquisition, partnership, and joint venture are the strategies adopted by the companies to retain their market position. For instance, in March 2019, Alternet Systems, Inc. announced its merger and acquisition pipeline to expand electric vehicle technology innovation and production capacity.

Electric Vehicle Market Companies

• Ampere Vehicles
• Benling India Energy and Technology Pvt Ltd
• BMW AG
• BYD Company Limited
• Chevrolet Motor Company
• Daimler AG
• Energica Motor Company S.p.A.
• Ford Motor Company
• General Motors
• Hero Electric
• Hyundai Motor Company
• Karma Automotive
• Kia Corporation
• Lucid Group, Inc.
• Mahindra Electric Mobility Limited
• NIO
• Nissan Motors Co., Ltd.
• Okinawa Autotech Pvt. Ltd.
• Rivain
• Tata Motors
• Tesla Inc.
• Toyota Motor Corporation
• Volkswagen AG
• WM Motor
• Xiaopeng Motors

Segments Covered in the Report

This research report estimates revenue growth at global, regional, and country levels and offers an analysis of present industry trends in every sub-segment from 2024 to 2033. This research study analyzes market thoroughly by classifying electric vehicle market report on the basis of different parameters including product and region as follows:

By Propulsion Type

• Hybrid Vehicles
  • Pure Hybrid Vehicles
  • Plug-in Hybrid Vehicles
• Battery Electric Vehicles
• Fuel Cell Electric Vehicles

By Components

• Battery Cells & Packs
• On-Board Charge
• Motor
• Reducer
• Fuel Stack
• Power Control Unit
• Battery Management System
• Fuel Processor
• Power Conditioner
• Air Compressor
• Humidifier

By Vehicle Type

• Passenger Cars
• Commercial Vehicles
• Two-Wheelers
• E-Scooters & Bikes
• Light Commercial Vehicles
• Others

By Vehicle Class

• Mid-priced
• Luxury

By Top Speed

• Less Than 100 MPH
• 100 to 125 MPH
• More Than 125 MPH

By Vehicle Drive

• Front-Wheel Drive
• Rear Wheel Drive
• All Wheel Drive

By EV Charging Point Type

• Normal Charging
• Super Charging

By V2G

• V2B or V2H
• V2G
• V2V
• V2X

By Geography

• North America
• U.S.
• Canada
• Europe
• U.K.
• Germany
• France
• Asia-Pacific
• China
• India
• Japan
• South Korea
• Malaysia
• Philippines
• Latin America
• Brazil
• Rest of Latin America
• Middle East & Africa (MEA)
• GCC
• North Africa
• South Africa
• Rest of the Middle East & Africa