Global xEVs Market: Key Research Findings 2020

Decreased Incentives in China Led Smaller Growth in Global xEVs Production in 2019 to Reach 6,821 Thousand, 118.8% of Previous Year

Yano Research Institute (the President, Takashi Mizukoshi) carried out a survey on the xEV batteries market and found out the trends by product segment, the trend of market players, and the future outlook. This press release discloses the transition and forecast of global number of xEVs production, which determines the production of automotive lithium ion batteries.

Market Overview

The estimated global xEV market size for 2019, based on the production volume at manufacturer, was 6,821 thousand vehicles, 118.8% of that of the previous year. The details were as follows: Production of HEVs (hybrid EVs) grew by 28.6% on a year-to-year basis to 4,287 thousand vehicles, EVs (electric vehicles) rose by 13.2% on the same basis to reach 1,958 thousand vehicles, and PHEVs (plug-in electric vehicles) declined by 15.1% on the same basis to 576 thousand vehicles.

HEVs (including both mild and full (or strong) hybrid electric vehicles) have shown steadfast growth chiefly in Europe, while significant increase is observed in EVs with mid-size capacity (40 to 69 kWh pack), driven by Tesla’s Model 3.

On the other hand, PHEVs and low-capacity EVs (5 to 39kWh pack) showed downturn from the previous year results. In particular, demand in China is sluggish due to changes in the subsidies conditions, though the country used to drive the xEV market by expanding A-segment (low-capacity) EVs, PHEVs, and commercial EVs such as buses. The sales of high-capacity (70kWh pack or more) EVs also decreased from the previous year, because Tesla’s Model 3 that had been the main player in the segment moved on to mid-size capacity, and because many countries removed the incentives for high-end EVs.  

Future Outlook

The growth forecasts were carried out from the two different viewpoints, i.e. governmental policies and market environment, taking account especially of industry-wise contraction of the global automobile market due to COVID-19 pandemics, and of the economic measures taken at this point.

The government-policy based forecast foresees that xEV market especially in Europe maintains the growth in 2020, against the backdrop of global enhancement in environmental regulations, EV promotion policies by each country, and business shift to EVs at automobile manufacturers (OEMs).

In Europe, Germany and France have announced post COVID-19 green stimulus packages in June 2020 to encourage the sales of PHEVs and EVs. The packages are projected to boost the EV market even after expansion of COVID-19 infections. Our forecast foresees the growth of EVs with mid-size capacity after 2021, because some countries are projected to take a serious step for achieving environmental goals which requires a certain level of PHEVs and EVs sales growth, and because Chinese lithium ion battery manufacturers are expected to announce new pack technologies. Small-capacity EVs are also expected to increase the sales to a certain level, as Volkswagen plans to release VW ID.1 in 2023. As a result of being standardized mainly at European OEMs, mild HEVs can expect price reduction in their system components, which may attract consumers furthermore. Full HEVs are forecasted to keep on growing, due to the sales performance in 2019 and new entry observed in European as well as Chinese OEMs. Based on the above, the xEV market size from the government-policy viewpoint is forecasted as 28,210 thousand vehicles by 2025 and 47,920 thousand by 3030, based on the production volume at manufacturers.

As the market forecast from the market environment viewpoint sees the EV market from the consumer standpoints such as user-friendliness and affordability, it foresees decline in consumer demand, for it will be affected by economic downturn caused by COVID-19 pandemics. Although the xEV market is projected to upturn after 2021, in a situation where the automobile market as a whole has been shrinking, the sales of PHEVs and EVs cannot expect to reach the initial goals, because of smaller profit for OEMs than ICE vehicles. The economic conditions, too, ensure the market not to attain the initial goals despite expanding demand by consumers. On the other hand, full HEVs are expected to continue growing to a certain level, because of new entry is observed at European and Chinese OEMs though there may be a concern of oil price reduction. Mild HEVs are expected to increase the sales ratio, as mild hybrid systems are becoming standard options in many European OEMs and as PHEVs and EVs are sluggish as mentioned above. Based on the above, the xEV market size from the market environmental viewpoint is forecasted as 12,060 thousand vehicles by 2025 and 20,300 thousand by 3030, based on the production volume at manufacturers.

Research Outline

1.Research Period: May to July 2020
2.Research Object: Automobile manufacturers (in Japan, Europe, China, and South Korea)
3.Research Methogology: Face-to-face interviews by our expert researchers, and literature research

xEV Market

The next generation vehicles, i.e. xEVs refer to EV (electric vehicle), PHEV (plug-in hybrid electric vehicle), and HEV (hybrid electric vehicle), which use a combination of lithium ion battery and motors, or a combination of lithium ion battery, motors and ICE (internal combustion engine). The market in this research does not include vehicles with only ICE installed.

The market size of xEVs is the number of EVs, PHEVs, and HEVs that are used as either passenger EVs or commercial EVs (in the form of a bus, truck, distribution vehicle, minivan for a specific use, etc.) produced at xEV manufacturers. 

<Products and Services in the Market>

xEV, EV (electric vehicle), PHEV (plug-in hybrid electric vehicle), and HEV (hybrid electric vehicle)

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