What is Electric Commercial Vehicle and What is it’s Demand in Industry
An electric vehicle is driven by a battery rather than an internal combustion engine, which produces energy by burning fuel and gases. Electrical power is used instead of diesel or gasoline to power construction equipment such as wheel loaders and excavators and commercial vehicles such as buses, trucks, and vans. The power grid is used to recharge an internal battery inside these cars. Electric commercial vehicles are becoming popular due to their low carbon footprint, low maintenance requirements, smoother ride, and reduced engine noise. With increased public awareness of the dangers and threats to the environment and the harm done to the ecosystem by conventional gasoline and diesel vehicles, the market for commercial electric vehicles is one of the world’s fastest-growing.
The global electric commercial vehicle market was worth $57 billion in 2021 and is expected to be worth $848.94 billion by 2030, growing at a 35% CAGR between 2021 and 2030. In 2021, Asia-Pacific will control 45% of the global market.
Market drivers
- Factors contributing to the market growth are a significant increase in the price of fossil fuels. According to SMR’s survey, approximately 84.11% of automobiles worldwide rely on fossil fuels for their energy supply. Since the price of fossil fuels has reached its limit, countries such as Norway, Germany, the United States, and China are shifting to renewable energy sources, resulting in increased demand for ECVs and propelling the market growth.
- Aside from a rise in fossil-fuel prices, lower ECV cost of maintenance and an increase in government initiatives to spend more money on ECV production are boosting the market growth. According to a research survey, the overall cost of maintenance for ECVs is approximately (30 to 40%) less than that of I.C. vehicles.
Market restraints
Most countries cannot have high charging densities due to a lack of adequate E.V. charging infrastructure, limiting the growth of the ECV business. Although most countries want to improve their E.V. infrastructure, very few have built the infrastructure required for a complete transition to E.V.s. The Netherlands has the highest density, with more than 100 EV chargers per km. Most fleet providers prefer dedicated charging stations for their commercial vehicle fleets; however, vans and pickup trucks can be recharged using charging stations designed for electric passenger cars. Pantographs and specific charging ports are also required for the daily charging electric buses and trucks. Commercial vehicle charging infrastructure is far more limited than that of electric vehicles.
Key opportunity
Wireless charging technology for on-the-go charging has been in development for several years. When this technology matures, people will no longer need to charge their vehicles because they will be charged automatically while in use. This technology is currently prohibitively expensive, but it may be used in the coming decades. It is expected to significantly impact the E.V. market because sales are expected to increase rapidly when this technology is used.
Segmentation analysis
- A BEV (Battery Electric Vehicle) is a propulsion-only electric vehicle that is entirely powered by batteries. A built-in battery powers the magnet motor that drives the vehicle. BEVs typically range from 150 to 200 miles, depending on the type of battery installed. Buses, vans, and lorries are typically used for intracity travel and are outfitted with BEV propulsion systems. Because intracity travel is the most common use for these vehicles, BEVs are expected to see significant demand in the coming years.
- End-use segments of the global electric commercial vehicle market include long-distance transportation, field service, distribution service, and last-mile delivery. The last-mile delivery market is expected to grow at a rapid CAGR during the forecast period due to increased online sales and the widespread adoption of e-commerce.
- Because end-users are increasingly adopting low-range electric trucks, particularly for last-mile deliveries and intra-city logistics, the category of fewer than 150 miles will account for a larger revenue share in the global electric commercial vehicle market in the forecast time frame.
- According to the type of vehicle, electric vans are closed wagons or motor trucks with an electric engine connected to the power grid. In the future, they are expected to represent the largest vehicle type category in the market for commercial electric vehicles.
- The Asia-Pacific market is anticipated to have a higher revenue share during the projection period than other regional markets. The Chinese electrical public transportation industry is the main engine of revenue growth in the Asia Pacific market.
Key players
Established players like BYD (China), Yutong (China), A.B. Volvo (Sweden), VDL Groep (Netherlands), and CAF dominate the market for commercial electric vehicles.
