Need for Clean Mobility Charging the Electric Vehicle Revolution
From the desk of Muzaffar Sayyed
An electrifying wave of electrification is bringing about profound changes in the automotive industry. Electric vehicles (EVs) are emerging as the next big thing in transportation and phasing out the decades-old internal combustion propulsion practices. Sustainability and advancements in battery technology are key prospects promoting the sales of electric vehicles around the world. The want and need for clean mobility solutions to reduce the impact of emissions from vehicles has secured a good spot for EVs in the future of transportation. As per Skyquest, the global electric vehicle market is forecasted to expand at a robust CAGR of 9.68% from 2024 to 2031 and end up with a valuation of USD 1198.29 billion by the end of the forecast period.
Asia Pacific Emerging as a Hotspot for Electric Vehicle Companies
The presence of a robust automotive manufacturing industry and the availability of incentives and subsidies for electric vehicle purchases are boosting the sales of electric vehicles in the Asia Pacific region. China has been the most prominent name in the global electric vehicle market, bolstering the importance of Asia Pacific for electric vehicle companies.
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As per an article by the World Resources Institute, China sold around 4.4 million all-electric vehicles in 2022, which amounted to around 22% of all passenger vehicle sales in the country.
Automotive manufacturers such as Honda, Tata, Hyundai, and Toyota are continually focusing on capitalizing on the vehicle electrification trend as they emphasize the launch of new electric vehicles. India is also emerging as a highly attractive market for EVs in the Asia Pacific region after China. Low to mid-priced electric vehicles will be highly sought-after in the Asia Pacific region as disposable income of people increases in the future.
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In April 2024, Hyundai Motor Group, a leading manufacturer of vehicles, announced that it would be rolling out its first ‘Made in India’ electric car from its plant in Sriperumbudur, Tamil Nadu. The company also revealed its plans to maximize its EV production in India going forward.
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In April 2024, Honda, a renowned Japanese automotive manufacturer, launched three new models of electric cars at the 18th Beijing International Automotive Exhibition. The company also revealed its plans to launch 3 more models by 2027.
Absence of Charging Infrastructure Slowing Down Electric Vehicles
Electric Vehicle Charging Infrastructure: The major restraint for electric vehicle market growth lies in the absence of a charging infrastructure for electric vehicles. EVs have a limited range and need to be recharged but the absence of electric vehicle charging stations around the world is what limits most people from adopting EVs. Efforts to improve the situation are being made around the world and this trend is slated to benefit sales of electric vehicles in the future.
Some key developments in EV charging infrastructure are:
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In April 2024, Adani TotalEnergies E-Mobility Limited, a subsidiary of Adani Group, signed a Memorandum of Understanding (MoU) with MG Motor India to improve the EV charging infrastructure in India. CC2 60 kW DC chargers will be set up at MG dealerships to enhance accessibility for MG EV users.
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In November 2023, Lotus, a British multinational automotive company, launched new charging solutions for electric vehicles. An ultra-fast 450 kW DC charger along with a modular unit capable of charging up to 4 cars were launched among other commercial charging products.
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In October 2023, British Petroleum (bp), a leading oil & gas company, placed an order for Tesla’s ultra-fast chargers valued at USD 100 million. bp intended to boost its EV charging infrastructure with this order.
Europe and Electric Vehicles Go Hand in Hand
Rising awareness regarding the benefits of EVs among Europeans and the increasing focus of European countries to achieve their net-zero carbon goals allows Europe to be a key region for electric vehicle companies. Increasing availability of subsidies and incentives by governments and regulatory bodies in European countries is also a key factor that is driving Europe electric vehicle market growth. Norway and Germany are forecasted to be the top countries for electric vehicle providers in Europe.
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The government of Romania offers drivers a grant of up to €11,500 to drivers who scrap their old vehicle and purchase a new battery electric vehicle (BEV).
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In 2023, the government of Malta implemented a new incentive scheme for the purchase of BEVs and offered up to €12,000 to drivers willing to scrap their old car and purchase a new BEV.
Though many countries are incentivizing the purchase of electric vehicles, there are many European countries that are reducing their incentives and subsidies as EVs start to become mainstream. This is having a negative impact on sales of electric vehicles in Europe.
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In 2022, the government of the United Kingdom halved its incentive for the purchase of BEV from £3,000 to £1,500. This has resulted in a notable drop in sales of EVs in the country.
A similar trend is observed in Germany, Slovakia, and other European countries where sales plummeted after the removal or decrease in incentives. European countries need to address this issue if they want to attain their net-zero carbon goals as vehicle emission is one of the leading contributors to a country’s carbon footprint.
When Will the Electric Vehicle Revolution Succeed?
Hybrid electric vehicles are projected to be highly popular as they are capable of running on electric as well as internal combustion engines as well. These vehicles will pave the road for the adoption of all-electric vehicles as charging infrastructure develops. A complete electric transportation system for the world is still a long way away from us but hybrid EVs are estimated to prepare the world for electric mobility. While there are doubts about the success of EVs citing issues such as battery raw material sourcing, range concerns, and lack of standardization, there is hope that electric mobility will be a success in the long term.
Rising demand for clean energy to power electric vehicles will surely make them a mainstay in future transportation. Moreover, advancements in fuel cell technology and battery technology will also help overcome the restraints inhibiting electric vehicle market growth.
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