Electric Components for New Energy Vehicle Market Size [2031]

Report Description

Electric Components for New Energy Vehicle Market Outlook 2031

The global electric components for new energy vehicle market size was valued at USD XX Billion in 2022 and is likely to reach USD XX Billion by 2031, expanding at a CAGR of XX % during 2023 – 2031. The market growth is attributed to the rising stringent norms on carbon emission across the globe.

Increasing stringent norms on carbon emissions globally are expected to boost the demand for electric components for new energy vehicles in the coming years. Stringent carbon emission norms are encouraging people to shift towards green energy, which increases the demand for electric vehicles and their components such as battery packs, DC-DC converters, and controllers & inverters. Thus,  the rising norms on carbon emissions are propelling the market. For instance,

• On January 1, 2020, the European Union imposed CO2 emission performance standards for new passenger cars and vans.

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Electric components are used in electric vehicles to process and control the flow of electrical energy in vehicles. It also controls the speed of the motor and the torque of electric vehicles. These components are widely used in hybrid and plug-in electric vehicles. Battery packs, DC-DC converters, controller & inverters, motors, and on-board chargers are the types of electric components for new energy vehicles.

The COVID-19 pandemic hampered the demand for electric components for new energy vehicles. The manufacturing facilities of electric components faced disturbance during the pandemic, due to the shortage of manpower and materials as well as the closure of international trade, which impeded the market.

Moreover, a drastic fall was seen in the sales of new electric vehicles during COVID-19. This hindered the demand for electric components for new energy vehicles, as these components are especially used in electric vehicles. For instance,

• As per the International Energy Agency, electric car sales fell by 16,000 vehicles in February 2020 in China, which was a decline of 60% from the sales of 2019. Moreover, the US electric vehicle sales fell by around 50% in April 2020.

Impact of Artificial Intelligence (AI) on Electric Components for New Energy Vehicles Market

The continuous development in technology is integrating artificial intelligence in electric vehicles (EVs), which creates an immense opportunity in the market. AI-powered electric components such as electric motors analyze data from several sensors to identify the optimal settings for boosting the range of EVs. AI in electric components determines patterns and detects potential system failures before they occur.

AI-enabled electric components use machine learning algorithms to improve battery lifespan and performance, as they monitor the health of a battery over time and analyze a variety of factors such as voltage levels and temperature.

Electric Components for New Energy Vehicles Market Dynamics

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Major Drivers

Improving charging infrastructures for EVs is expected to boost the demand for electric components for new energy vehicles during the forecast period. Improving infrastructure of charging stations is encouraging people to adopt electric vehicles, as charging stations charge batteries of EVs by converting the AC or DC electrical power into the appropriate voltage, which is projected to boost the demand for electric components that are used in electric vehicles in the coming years.

Increasing demand for electric vehicles is anticipated to drive the market in the coming years. Electric components such as battery packs, controller & inverter, motor, and onboard chargers are utilized in electric vehicles to transfer the energy from the battery to the motor. It generates acceleration for the vehicle, converting power for the vehicle to get fully charged. Therefore, the rising adoption of EVs is propelling the market. For instance,

• According to the International Energy Agency, 26 million electric cars were present on the road in 2022, 60% up from 2021.

Existing Restraints

High cost of electric vehicles is expected to restrict the market during the forecast period. Electric vehicles include batteries that are made up of rare earth metals such as lithium, cobalt, and nickel, which make them expensive.

Moreover, the Level 1 onboard chargers are a type of electric component that provides slow charging that makes EVs less practical for long-distance travel. This is projected to hamper the demand for electric components for new energy vehicles in the coming years.

Emerging Opportunities

Rising fuel prices across the globe create an immense opportunity in the market. Consumers are shifting their focus toward electric vehicles, due to the surge in fuel prices, which is estimated to boost the demand for electric components for new energy vehicles. These components are utilized in EVs to run different functionality of the vehicle. Moreover, increasing investment in R&D activities by key market players to develop and introduce new electric components for new energy vehicles creates a lucrative opportunity in the market. For instance,

• On August 18, 2023, GWP-Powerland Technology, Inc., a leading power conversion company, announced the launch of a new series of IP67-rated DC/DC converters for electric vehicles (EVs). It offers two DC input ranges featuring 12 V and 24 V output voltages to power auxiliary EV functions such as lights, instruments, and accessories. It resists under-voltage lockout, reverse polarity, over-voltage, short-circuit, and over-temperature.

Scope of the Electric Components for New Energy Vehicles Market Report

The report on the market includes an assessment of the market, trends, segments, and regional markets. Overview and dynamics have also been included in the report.

Electric Components for New Energy Vehicle Market Segment Insights

Type Segment Analysis

Based on type, the electric components for new energy vehicles market is bifurcated into passenger vehicles and commercial vehicles. The passenger vehicle segment dominated the market in 2022 and is projected to continue its dominance throughout the forecast period, due to its potential to offer improved security and enhanced features.

An electric component is widely utilized in electric passenger vehicles to control the several functionalities of the vehicles such as generating acceleration and converting electrical power to charge batteries. Moreover, various individuals and organizations prefer electric passenger cars for commutation within the city limits, which increases the demand for electric components for new energy vehicles.

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Propulsion Type Segment Analysis

In terms of propulsion type, the global market is categorized into battery electric vehicles, plug-in hybrid electric vehicles, fuel cell electric vehicles, and hybrid electric vehicles. The battery-electric vehicles segment held a large share of the market in 2022, due to stringent carbon emission norms and favorable government incentives.

Battery-electric vehicles (BEV) require electric components such as DC-DC converters and electric motors to convert power from high voltage (HV) to 12V low voltage (LV) to charge the battery and power the onboard electric devices, which enhances the demand for electric components in BEVs.

The plug-in hybrid electric vehicles segment is expected to grow at a robust pace in the coming years owing to the fast-charging rate. Plug-in hybrid electric vehicles use Level 2 chargers which provide faster charging compared to battery-electric vehicles (BEV), which encourages buyers to purchase plug-in hybrid electric vehicles. Additionally, these vehicles have a bigger battery than other electric vehicles, increasing the range of the vehicles. These benefits provided by plug-in hybrid electric vehicles attract consumers to adopt them.

Component Segment Analysis

Based on components, the electric components for new energy vehicles market is divided into battery packs, DC-DC converters, controller & inverters, motors, on-board chargers, and others. The battery packs segment registered significant growth in 2022, due to the growing adoption of electric vehicles and the increasing use of portable electronic devices.

Electric vehicles use battery packs to store electrical energy and provide power to an electrical system such as an electric motor. Moreover, prominent companies in the market are developing and introducing battery packs for EVs, which is estimated to propel the demand for electric components for new energy vehicles in the coming years. For instance,

• On May 4, 2023, BorgWarner Inc., a US-based automotive company, announced to supply battery packs for a series of electric buses. These battery packs provide several safety features such as overcharge protection and cell-level passive propagation resistance.

The motors segment is projected to expand at a quick pace during the forecast period, owing to the rising demand for electric vehicles in the commercial industry and increasing carbon emission norms. An electric motor is one of the main components of an electric vehicle that converts electrical energy into kinetic energy to rotate the wheels. Moreover, these motors are extremely efficient in generating very little heat compared to combustion engines, which enhances their demand.

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Regional Outlook

In terms of region, the electric components for new energy vehicles market is segregated into Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. Asia Pacific accounted for a major share of the market in 2022, due to the rising fuel prices, stringent emission norms, increasing disposable income, and favorable government policies.

Stringent emission norms and surging fuel prices in the region are encouraging people to adopt or purchase electric vehicles (EVs), which is propelling the demand for electric components for new energy vehicles. These components are utilized in EVs to run different functionalities of the vehicle. For instance,

• As per the report published by the China Association of Automobile Manufacturers, China sold 6.9 million electric cars in 2022, an increase of 93.4% as compared to the previous year.

The market in North America is anticipated to expand at a high CAGR during the projected period, owing to increasing advancements in electric vehicles and the presence of major market players such as BorgWarner Inc. and PARKER HANNIFIN CORP. Moreover, the growing adoption of EVs in the region, due to the stringent emission norms is propelling the demand for electric components for new energy vehicles. For instance,

• As per the report published by the International Energy Agency, 1 million electric vehicles were sold in the US in 2022, and the number is expected to reach 2.46 million in 2028.

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