Vehicle Electrification Market By 48V, ICE, BEV, HEV, PHEV, Vehicle Type,Product (Start-Stop, PTC, EPS, Electric Air Conditioner, ISG, Starter Motor, Alternator, Actuator, Electric Pump-Vacuum, Oil & Water) - Partner & Customer Ecosystem (Product Services, Proposition & Key Features) Competitive Index & Regional Footprints by MarketDigits - Forecast 2024 – 2032

The vehicle electrification market reached a value of $73.7 billion in 2023 and is projected to reach approximately $129.6 billion by 2030, with a compound annual growth rate (CAGR) of 11.9% during the period from 2023 to 2030. The numerous advantages offered by vehicle electrification, such as reduced vehicle weight, lower emissions, improved fuel efficiency, enhanced driving comfort, and increased safety, make it a preferred option for original equipment manufacturers (OEMs) in the near future.

Before the COVID-19 pandemic, the vehicle electrification market was expected to reach 735 million units by 2030 in terms of volume, up from 540 million units in 2023. The potential impact of a second wave of the pandemic poses a significant threat to the automotive manufacturing industry. However, with the easing of lockdown restrictions in the US and China, allowing the resumption of production operations, the automotive ancillary industry is expected to recover by the end of 2023, thereby driving the vehicle electrification market.

Market Dynamics
DRIVER: Rising demand for 48V architecture
The concept of 48V architecture or mild hybrids is gaining momentum globally, which is expected to drive the demand for vehicle electrification. While full hybrid vehicles offer better fuel economy, their higher cost and weight pose challenges for manufacturers. In contrast, mild hybrid systems with a 48V battery are cost-effective and involve the addition of an electric motor with a power of up to 15 kW to a conventional internal combustion engine (ICE). This approach is preferred by OEMs as it balances the cost of the electric motor with the removal of the starter motor and alternator from the ICE.

RESTRAINT: Difficulty in achieving and maintaining an optimum power-to-weight ratio
The power-to-weight ratio plays a crucial role in the performance and efficiency of vehicles. Achieving an optimum power-to-weight ratio requires the use of advanced lightweight components and materials. OEMs and Tier I companies are working on incorporating lightweight materials and advanced products such as e-CVT and e-axles to improve the power-to-weight ratio. However, these efforts are still in the developmental stage.

OPPORTUNITY: Electrification of commercial vehicles
The electrification of commercial vehicles, including buses and trucks used for public transportation and logistics, presents a significant opportunity. Governments worldwide are promoting the use of electric vehicles in public transportation to reduce carbon emissions, offering incentives and tax rebates for e-trucks and e-buses. While most vehicle electrification efforts have focused on passenger cars, developing electric powertrains for commercial vehicles poses challenges due to higher loads. However, as the demand for reliable and high-performing systems increases with the widespread adoption of electric commercial vehicles, there is an opportunity for manufacturers of electric components and drivelines to develop and introduce products specifically for the commercial vehicle segment.

Overall, the vehicle electrification market is poised for substantial growth, driven by factors such as the benefits of electrification, the demand for 48V architecture, and the electrification of commercial vehicles.

The vehicle electrification market reached a value of $73.7 billion in 2023 and is projected to reach approximately $129.6 billion by 2030, with a compound annual growth rate (CAGR) of 11.9% during the period from 2023 to 2030. The numerous advantages offered by vehicle electrification, such as reduced vehicle weight, lower emissions, improved fuel efficiency, enhanced driving comfort, and increased safety, make it a preferred option for original equipment manufacturers (OEMs) in the near future.

Before the COVID-19 pandemic, the vehicle electrification market was expected to reach 735 million units by 2030 in terms of volume, up from 540 million units in 2023. The potential impact of a second wave of the pandemic poses a significant threat to the automotive manufacturing industry. However, with the easing of lockdown restrictions in the US and China, allowing the resumption of production operations, the automotive ancillary industry is expected to recover by the end of 2023, thereby driving the vehicle electrification market.

CHALLENGE: Developing fail-safe electronic and electrical components
The advent of electric vehicles brings advanced technologies and electric power components into the automotive industry. However, there are inherent risks associated with these technologies, such as battery bank thermal runaway and fire hazards, which require careful evaluation. Ensuring safety is crucial in various aspects of vehicle electrification, including electric system safety, functional system safety, battery charging safety, and vehicle maintenance, operation, and training. Presently, the high cost of batteries, issues of overheating, limited energy storage capacity, and the development of vehicle batteries pose challenges that hinder the widespread adoption of electric vehicles. Additionally, it is vital to address the reliability of these systems, as occasional failures make them less efficient compared to traditional internal combustion engine (ICE) vehicles. Therefore, automobile manufacturers need to ensure that their electrical systems and components operate efficiently under diverse conditions to encourage customer adoption.

"Electric power steering is estimated to be the largest segment for the vehicle electrification market"
Electric power steering (EPS) is expected to hold the largest market share in the vehicle electrification market. EPS helps reduce fuel consumption and enhances vehicle maneuverability. In Europe and North America, almost all vehicles are equipped with EPS, and the trend is rapidly growing in the Asia Oceania region, with an EPS installation rate of nearly 90%. Consequently, the EPS segment is anticipated to have the highest market share throughout the forecast period.

Plug-in hybrid electric vehicle (PHEV) is estimated to witness the fastest growth in the vehicle electrification market
PHEVs represent the fastest-growing segment in this market. Automakers view plug-in hybrids as a transitional step towards fully electric vehicles. The increasing availability of charging infrastructure in China, the US, and European countries is facilitating the shift from conventional ICE vehicles to PHEVs. Original Equipment Manufacturers (OEMs) in these regions are also making significant investments in vehicle electrification, further driving the demand for PHEVs.

"North America is expected to be the fastest growing market for vehicle electrification"
The vehicle electrification market in North America is expected to witness significant growth. This growth is driven by the expanding charging infrastructure and substantial investments made by Original Equipment Manufacturers (OEMs) to advance vehicle electrification technologies. Federal tax credits and rebate incentives are further accelerating market growth, particularly in the United States. With the presence of major OEMs and Tier I players, the United States is projected to dominate the North American vehicle electrification market, capturing the highest market share in 2019. The adoption of electric components in Internal Combustion Engine (ICE) vehicles, Battery Electric Vehicles (BEVs), Hybrid Electric Vehicles (HEVs), and Plug-in Hybrid Electric Vehicles (PHEVs) is notably high in the country. Consequently, North America is expected to be the fastest growing market throughout the forecast period.

Key Market Players
The vehicle electrification market is composed of major manufacturers such as Bosch (Germany), Continental (Germany), Denso (Japan), BorgWarner (US), and Mitsubishi Electric (Japan). These companies possess robust global distribution networks and offer a wide range of products. To maintain their market position, these companies employ strategies such as new product development, expansion, collaboration, and contracts/agreements.

The study provides an in-depth competitive analysis of these key players in the vehicle electrification market. It includes their company profiles, SWOT analysis of the top five companies, recent developments, and key market strategies.

Bosch is expected to be a dominant player in the global market. To retain its leading position in the vehicle electrification market, Bosch has implemented strategies such as expansion, new product development, partnership, and merger & acquisition. Bosch also has a presence in emerging markets like India, China, and Brazil. Strengthening its product portfolio, expanding its global presence, and building customer relationships are the strategies Bosch employs to maintain its leadership in this market.

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This research report categorizes the given market based on Product, 48V, ICE, BEV, HEV, PHEV, Vehicle Type, and Region
Vehicle Electrification Market, by Product Type
• Start/Stop System
• Electric Power Steering (EPS)
• Electric Air-Conditioner Compressor
• Electric Vacuum Pump
• Electric Oil Pump
• Electric Water Pump
• Liquid Heater PTC
• Integrated Starter Generator (ISG)
• Starter Motor
• Alternator
• Actuator

Vehicle Electrification Market, by Degree of Hybridization
• Internal Combustion Engine (ICE) & Micro-Hybrid Vehicle
• Hybrid Electric Vehicle (HEV)
• Plug-In Hybrid Electric Vehicle (PHEV)
• Battery Electric Vehicle (BEV)
• 48 V
48V Mild-Hybrid Market

Vehicle Electrification Market, by Region
• Asia Oceania
• Europe
• North America
• RoW