Electric vehicle production is expected to increase 16 fold over the next ten years, according to new report from IMS Research.
Just two per cent of all the vehicles manufactured in 2010 were a type of electric vehicle-either hybrid, plug-in hybrid, battery electric or fuel cell vehicle-equating to less than a million vehicles.
This is expected to grow to over 16 million by 2021, accounting for 16 per cent of all the vehicles manufactured in the world.
A new report from the research firm called ‘Opportunities for System and Semiconductor Manufacturers in Hybrid and Battery Electric Vehicles’ reveals that less than 16,000 battery electric vehicles and 2,000 plug-in hybrids were produced last year-leaving significant room for market growth and opportunity for investors over the coming decade, as the market is expected to explode.
“Japanese vehicle manufacturers initially dominated production of electric vehicles and used either their own existing suppliers or used systems from suppliers they part-own – their Keiretsu partners,“ says principal analyst, Jon Cropley. “These barriers to market entry are disappearing as vehicle manufacturers from other regions ramp-up production and Japanese vehicle manufacturers look for competing suppliers.”
Today, growing demand for electric cars is creating new vehicle manufacturers such as Tesla Motors, Coda, Fisker, BYD, and Aptera, who are joining established household-name manufacturers like Toyota, Ford and General Motors in this high potential growth market. Equally, growing demand for electric cars is also providing would-be suppliers in other tiers of the supply chain with a once-in-a-generation opportunity to enter the automotive market.
Examples of companies entering the market include A123 Systems of the United States and LG Chem of South Korea which have agreements to supply lithium ion batteries for major electric vehicle programmes. They also include US companies AC Propulsion, Remy International and UQM Technologies which all offer traction motors. What is more, further down the supply chain, semiconductor companies from outside Japan are supplying devices for electric vehicle programmes. Examples include Infineon Technologies, Texas Instruments and STMicroelectronics.
“This massive forecasted growth in the global electric car market, driven by consumers‘ increasing demand for cheaper to run and greener vehicles, and supported by government policy around the world, is creating a sea-change in the automotive industry,“ Cropley adds. “ While many of the established car manufacturers and their suppliers are responding to this new demand, new players – both OEM and across the supply chain – are well poised to take advantage and gain meaningful market share.“
IMS Research is a independent supplier of market research and consultancy to the global electronics industry.
