EV Powertrain Market is Likely to Accelerate in the Near Future, says The Insight Partners

Significant developments in energy storage, electric motors, power electronics, and the development of charging infrastructure are anticipated to propel the EV Powertrain Market growth. Innovations in battery technologies have made EV powertrain more competitive than conventional ICE vehicles by offering an enhanced range in a single charge. Data of Edmunds, a leading online automotive shopping resource, states that consumers are opting for sustainable alternatives, i.e., EVs, over traditional cars. According to many powertrain manufacturers and associations, the prices of powertrains are likely to decline in the coming years, owing to which the demand for EVs among customers will pick up pace.                            

Leading Players in EV Powertrain Market

Well-established automotive players are now investing in the production of electric vehicles. Players such as Bosch, Mitsubishi Electric, Magna, Continental AG, Nidec Corporation, Panasonic, Schaeffler AG, Toyota Industries Corporation, Valeo, and Hitachi dominate the global EV Powertrain Market. Manufacturers focus on developing lightweight and compact EV powertrain solutions suitable for daily transportation. They are increasingly advancing their technologies with artificial intelligence and the internet of things (IoT) to create a strong consumer base.

Major technologies used by the players in the EV Powertrain Market are hybrid electric vehicles and battery electric vehicles (BEVs). BEVs account for a maximum market share. BEV runs on an electric drivetrain powered by rechargeable batteries, constituting about 50% of the total cost. In the coming years, the demand for BEVs is anticipated to increase further due to technological advancements and reduced lithium-ion battery prices.                             

Also, various collaborations in recent years between automakers and tech companies have resulted in advanced electric vehicles. For instance, in July 2021, Mercedes-Benz announced the acquisition of the next-generation electric drive technology Yasa. Recently, CETL, a global powertrain company, declared a multi-year partnership with Indian start-up TSUYO to develop high-end efficient EV motors jointly. Also, General Motors established a joint venture with LG Chem by investing US$ 2.3 billion to produce battery cells for electric vehicles. In January 2022, Magna International Inc. revealed the Intelligent Force, a battery electric 4WD powertrain system for pickup trucks and light commercial vehicles.                           

Government Initiatives Boosting EV Powertrains

Globally, government bodies have imposed stringent emission norms on automotive manufacturers, pushing manufacturers to escalate R&D for electric vehicles to offer customers a cost-effective alternative. According to GOV.UK, in July 2019, authorities in the UK invested about US$ 100 million in the development of next-generation electric vehicles. Although China and Europe have seen the highest EV adoption rate, markets across the world are picking pace. The rising government policies and guidelines to support the expansion of electric vehicles through subsidies and incentives will bolster the demand for EV powertrains.            

Rising Investments in EV Powertrain Market

The Original Equipment Manufacturers (OEMs) and technology providers continuously invest in developing robust solutions, attracting vehicular customers. Various international EV manufacturers are investing and expanding their reach to different countries. Tesla, a top EV company, is investing US$ 2.0 billion in a new plant in Shanghai, China, to produce the Model 3 sedan and future vehicles. Also, Volkswagen has adopted a similar plan to capitalize on more than US$ 10 billion in China for over six years.    

Battery Swapping System and EV Charging Infrastructure

Governments worldwide are investing in EV charging infrastructure, and public charging stations have been installed in various places. In April 2022, automobile manufacturer BYD India collaborated with Charge zone, Volttic, and Indipro to set up charging infrastructure for EVs in India. The Government of Canada invested US$ 182.5 million to develop a fast-charging network for electric vehicles. Also, the governments of China and France are subsidizing the construction of public charging stations to fuel the adoption of EV powertrain.  

In parallel, battery swapping can overcome many of the downfalls of conventional EV charging while charging infrastructure continues to build up in countries. Battery swapping allows EV owners to replace the discharged batteries with charged ones. Power vault has collaborated with Renault to develop home energy storage systems with dead batteries. Moreover, these batteries can be used for storing the excess power generated by wind and solar farms. Battery swapping helps in reducing the problem of setting up charging stations. In India, the government is also planning to launch a policy to incentivize the battery swapping technique. EV owners may provide incentives up to 20% on the subscription or lease cost of the battery.