Electric Powertrain Market Size, Share, Report 2024 to 2033

Electric Powertrain Market Size and Growth 2024 to 2033

The global electric powertrain market size was valued at USD 98.70 billion in 2023 and is expected to be worth around USD 466.73 billion by 2033, growing at a compound annual growth rate (CAGR) of 16.80% from 2024 to 2033.

As the globe shifts to greener transportation options, suppliers and OEMs are expected to find enormous opportunities as electrification propels rapid transformation. The silicon carbide technology is said to be the core of this progress and one of the major forces behind development over the next ten years. The advancements in electric vehicles are approaching a tipping point in the mid-2020s where efficiency will be the key market driver. Standardization of products and the technology that supports them will be highly desirable for a smooth and rapid increase in the number of electric vehicles. Leading-edge products should not stand alone; they must be supported by an equally innovative ecosystem and supply chain. Innovations driven by electrification are already driving extraordinary advances in transportation, Virgin Hyperloop is just one example.

Report Highlights

• Asia-Pacific holds the largest share of the global electric powertrain market, accounted 58% in 2023.
• Europe has generated revenue share of 25% in 2023.
• By component, the battery pack segment has accounted highest revenue share 63% in 2023.
• By type, the BEV segment has captured held largest revenue share of around 57% in 2023.

Electric Powertrain Market Growth Factors

• Enforcement of Strict Emission Regulations: Approximately 15% of the CO2 emissions worldwide are caused due to road transportation. Over half of these emissions are caused due to passenger transports such as cars and buses. In addition, to combat the ongoing climate change there is a growing demand for reducing greenhouse gas (GHG) emissions from fuel combustion. In Europe, energy consumption is greatly influenced by the road transportation industry and hence there are strict regulations related to emissions. To achieve net-zero greenhouse gas emissions, the EU government is following strict rules of CO2 emission regulations for passenger cars and light commercial vehicles. Therefore, such regulations lead toward practical solutions such as the electric car powertrain architecture.
• Growing Prices of Fuel: Consumers are increasingly gravitating toward electric mobility options as a result of ongoing fuel price hikes and ongoing environmental concerns. As a result, automakers are concentrating on creating e-drive systems that are small and light enough for daily use. In addition, attractive government policies and support through grants and subsidies, incentives for domestic production and mass adoption of electric vehicles, and other non-financial incentives are expected to boost the electric vehicle drive market.
• Growing Requirement for Energy-Efficient Systems: As the world strives for a more sustainable future, the benefits of energy-efficient systems have become well-known. Energy-efficient powertrain systems require some features to adapt to varying working circumstances, such as the capacity to track performance and economy, and balance power generation and heat dissipation for enhancing range.
• Lower Maintenance Costs: Electric powertrain systems have fewer moving parts and hence require less maintenance. Further, with the proper care and suitable conditions, the batteries can last up to 12 years. However, it gradually loses capacity, just like any other battery.
  Rising State Mandates: Some states are enacting legislation that will only allow the sale of electric vehicles going forward and prohibit the sale of any gasoline vehicles. This is driving automakers to enhance and broaden their sscope of electric vehicles.

Electric Powertrain Market Trends

• Merging ADAS with Powertrains: Incorporating advanced driver assistance systems (ADAS) into electric powertrains assists in improving driving skills. Features such as adaptive cruise control, automated emergency braking, and lane-keeping assistance are offered by the ADAS. Further, the integration of ADAS with powertrains enhances the functionality of EVs and helps in developing fully autonomous driving. As ADAS technologies continue to evolve, their integration into electric powertrains will be critical to the development of next-generation vehicles that offer greater safety, performance, and usability.
• Innovation in Battery Technology: Battery technologies have made electric vehicles more competitive than traditional combustion engine vehicles by offering greater range on a single charge. Batteries are an essential part of the electric powertrain system. Batteries account for a significant portion of the entire cost of any electric vehicle. However, due to technological advances, optimization of the production process, and economies of scale there is a significant drop in overall costs. Technological advancements in batteries have increased its range and the use of lithium-ion batteries has made BEVs more affordable and competitive in comparison to the traditional combustion engine vehicles.
• Investment by Market Players: Design-to-cost (DTC) methods are utilized by the OEMs for the simulation of EV powertrains. This inclination is especially noticeable in second-generation EVs. The DTC strategy is related to integrating components and using lightweight materials in structural parts into the EV powertrain. OEMs are further focused on developing a native EV platform. The native EVs have more interior space and optimized battery packaging. Therefore, the significant investments by OEMs in these fields are likely to improve the market for electric powertrains.
• Access in Remote and Rural Areas: Building infrastructure for charging EVs in rural areas, encouraging public-private partnerships, and educating the population are all necessary steps to expand EV adoption in remote areas. Further, financial incentives and collaboration with local players are likely to boost the adoption of EVs in remote areas, making them a practical choice in diverse communities.
• Development of Smart Grid: To avoid excessive strain on the grid, smart grids are used that can manage where, when, and how much electricity can be used for charging EVs. Developing programs that can manage charging time encourages customers to charge during off-peak hours, which can help save money and lessen the load on the grid. Managed charging programs by utilities include demand response, bidirectional charging, dynamic charging, and time-of-use (TOU).
• Bidirectional Charging: Bidirectionally capable EVs can charge during favorable grid conditions such as off-peak times or when renewable energy generation is high, and can release energy locally to reduce peak loads during grid outages and feed energy into the wider grid system to support ancillary services and peak demand events. Through all of these services, bidirectionally capable EVs can help customers survive grid outages, support peak demand savings, and receive incentives to feed electricity back into the grid.

Report Scope

Electric Powertrain Market Dynamics

Drivers

Increased Government Support and Incentives

• The encouragement by governments to use energy-efficient transportation is one of the major factors propelling the market for electric powertrains. Moreover, governments across the globe are providing a range of monetary incentives, including tax breaks and subsidies, to promote the adoption of BEVs, thereby augmenting the market expansion.

Growing Urbanization and Mobility

• One-size-fits-all solutions for sustainable mobility are electric vehicles. In developed nations, mobility has mostly been dominated by cars and concentrated on individual modes of transportation where a substantial amount of urbanization has occurred. Mobility planning increasingly focuses on a new paradigm that allows more sustainable and efficient movement of people and goods, particularly in developing nations. Driven by a strong global push for decarbonization, the biggest disruption currently is the transition to electric vehicles (EVs). Therefore, such factors are likely to drive market growth.

Restraints

Lack of Charging Stations for EV

• Sourcing of battery elements, infrastructure support, and economic feasibility are factors that have led to the slow adoption of electric vehicles around the world. The main battery components like lithium and cobalt are only found in specific areas. Australia, China, and Latin America are good sources of lithium; however, the Democratic Republic of the Congo (DRC) is the primary supplier of cobalt. Due to supply chain regulations imposed by the government and high transportation costs, sourcing these components is challenging and costly.

Fluctuating Raw Material Prices

• The electric powertrain market is highly sensitive to price fluctuations concerning raw materials such as lithium, cobalt, and rare earths. These raw materials are vulnerable to geopolitical conflicts and supply disruptions that are likely to disrupt the market. In addition, fluctuations in the availability and cost of these important raw materials can further lead to production delays and thus higher costs, which in turn impacts the stability and growth of the market.

Opportunities

Expansion into Emerging Markets

• The market for electric powertrains has enormous growth potential in emerging economies. It is anticipated that as these areas grow, there will be a greater need for energy-efficient infrastructure and buildings, opening up new markets for suppliers and manufacturers of insulation.

Use of Simulation Technology

• Electric vehicles (EVs) are designed, optimized, and assessed using simulation technology. Multi-objective optimization (MOO) technique is used by a simulator for designing an electric powertrain. Finding the optimal cost-benefit ratio while taking into account all specified system performance requirements can be aided by this. To design and optimize the electric powertrain—which consists of the battery, power electronics, electric machine, sensors, and control system—modeling and simulation tools are used.

Challenges

Concerns Associated with EVs

• Owing to the need for creating a high-performing yet affordable battery management system, electric vehicles are becoming expensive and, consequently, less appealing to the majority of the population. Another major obstacle is the infrastructure. The unavailability of fast charging and public charging stations is also one of the most crucial components hindering the market growth. However, limited accessibility and short range continue to be issues for electric vehicles. These factors have hampered the adoption of electric vehicles, which is expected to limit the electric vehicle powertrain market.

Lack of Consumer Awareness

• Lack of consumer education about electric vehicles (EVs) is a major barrier to their adoption. The reasons for the lack of customer education include inadequate communication, lack of familiarity with new EV technology, and knowledge deficits. In addition, ignorance of the benefits and incentives of purchasing an electric vehicle also poses a challenge to market growth.

Electric Powertrain Market Segmental Analysis

Type Analysis

BEV: The BEV segment is leading the electric powertrain market in 2023, accounted revenue share of 57%. The BEVs emit no emissions and hence rule the electric propulsion industry. They help abide by strict environmental regulations while reducing carbon footprints. Because BEVs are completely electric and produce no emissions, they are well-liked by customers who care about the environment. The simpler mechanical components of the BEVs and the ability to charge at home require less maintenance and operating money. As the infrastructure for charging BEVs keeps growing they are becoming a more practical option and popular vehicle type in the EV industry.

HEV: HEVs combine an internal combustion engine with an electric drivetrain, achieving improved fuel economy and performance compared to a conventional ICE vehicle.

HEVs are powered by electricity to varying degrees. Hybrid electric cars have several useful features, such as:

• Regenerative braking, which converts kinetic energy back into electrical energy for storage in the battery (also used by BEVs)
• Start-stop systems, which shut off the engine when idling, which reduces emissions
• An electric generator (powered by the internal combustion engine) that charges the battery or provides additional power to the electric motor
• Unlike PHEVs, HEVs are not usually charged from an external source. Examples of HEVs are Toyota Camry Hybrid, Ford Fusion Hybrid, and Honda Civic Hybrid.

PHEV: PHEVs are a subclass of HEVs. They can be charged from external sources. PHEVs are ideal for short city trips as they have a driving range of 20 to 50 miles (30 to 80 km) on electricity alone. For longer trips, PHEVs can rely on gasoline or diesel. Examples of PHEVs include the Toyota Prius Prime, Chevrolet Volt, and Honda Clarity.

FCEV: The fuel cell electric vehicle (FCEV) is a fourth type of electric vehicle. Fuel cell electric vehicles (FCEVs) have a similar powertrain to electric vehicles, but use a fuel cell to generate electricity from hydrogen fuel cells instead of a battery. FCEVs are more efficient than vehicles with a traditional internal combustion engine and do not produce harmful exhaust gases, only water vapor and warm air. However, a major disadvantage of FCEVs is that hydrogen is expensive.

Component Analysis

Battery Pack: The battery pack segment has garnered revenue share of 63% in 2023. The battery contains numerous cells (usually lithium-ion cells) that serve as the primary energy storage mechanism. Lithium-ion cells have a high energy density and can store a large amount of energy per unit volume. Fuel cells are another type of energy storage. The battery also contains a battery management system (BMS) that provides strategies that prevent overcharging or discharging to ensure the safe operation of the battery.

Power Electronics Controller: The power electronics controllers segment has accounted 13% of the total revenue share in 2023. Power electronics controllers are critical components of an electric vehicle (EV) that work together to control and convert electrical energy. The power electronics devices control and convert energy, making it available in the right form and amount when and where it is needed. Modern controllers regulate speed and acceleration through an electronic process called pulse width modulation. Switching devices such as silicon controlled rectifiers rapidly interrupt (turn on and off) the flow of current to the motor.

Motor/Generator: The motor generator segment has captured revenue share of 9% in 2023. The motor generator, in its role as a motor, provides the vehicle's electrical propulsion, while in its role as a generator, it converts mechanical braking energy into electrical energy. The need for motors is driven by the global increase in BEVs and HEVs. The electric motors/generators in these cars may be configured similarly. To capitalize on the increasing demand for electric powertrains, suppliers and OEMs are also likely to form joint ventures to develop motors/generators.

Converter: The converter segment has captured revenue share of 3% in 2023. The converter adapts the high-voltage DC output of the battery to provide the low-voltage DC needed to power auxiliary systems such as lighting, entertainment systems, or air conditioning. It integrates power electronics, including power semiconductors, diodes, capacitors, and magnets. A DC/DC converter can also be integrated into a power supply module (PDM) that contains a charger and a junction box.

Transmission: The transmission segment has held revenue share of 7% in 2023. Electric vehicles are often equipped with a single-speed transmission. However, there has been increased research and development to investigate the commercial viability of multi-speed transmissions, for example in the Porsche Taycan. Leading manufacturers in the EV transmission market are developing powershift and coasting capabilities with multi-speed transmissions for electric vehicles.

On-Board Charger: The on-board charger segment has held revenue share of 5% in 2023. The on-board charger converts alternating current (AC) from an external charging source (the grid) to direct current (DC) for storage in the battery. The on-board charger communicates with the vehicle control unit and the external charging station to regulate the power supply. It can also include cybersecurity features.

Electric Powertrain Market Regional Analysis

What makes Asia-Pacific the leader in the electric powertrain market?

The Asia-Pacific electric powertrain market size was estimated at USD 57.25 billion in 2023 and is expected to be hit around USD 270.70 billion by 2033. A sharp rise in the demand for electric vehicles (EVs) in China, Japan, and South Korea, is one of the driving factors for the growth in the electric powertrain market in the Asia Pacific. Strong government support, rising environmental consciousness, and initiatives to cut down emissions in heavily populated areas are the causes of the increasing demand in the region. Rapid urban growth in these countries has worsened pollution and traffic, so their governments are pushing electric vehicles as a key solution. This focus on EVs is strengthening the electric powertrain system market and helping these countries strive for better sustainability and cleaner urban air.

North America Electric Powertrain Market Trends

The North America electric powertrain market size was accounted for USD 10.86 billion in 2023 and is projected to surpass around USD 51.34 billion by 2033. The North America market is driven by the high penetration of electric vehicles. The region is characterized by the presence of major players such as Tesla, Chevrolet, and Ford. Furthermore, the U.S. and other countries have developed electric vehicle infrastructure such as charging stations, also known as Electric Vehicle Supply Equipment (EVSE). These factors are expected to boost the demand in the market.

Why is the Europe electric powertrain market experiencing sustainable growth?

The Europe electric powertrain market size was recorded at USD 24.68 billion in 2023 and is predicted to reach around USD 116.68 billion by 2033. Europe is expected to emerge as a significant during the forecast period owing to the presence of numerous OEMs in the region. Countries such as the Netherlands, Norway, France, and Sweden have witnessed high penetration of electric vehicles, which is likely to contribute to the growth of the electric powertrain market in the region. Countries such as France, Norway, Sweden, and the Netherlands have witnessed high penetration of electric vehicles, which is likely to contribute to the market growth in this region. Germany is one of the largest automobile hubs globally. Most of the automobile manufacturers such as Audi AG, Volkswagen AG, and BMW AG are focusing on the production and sale of electric vehicles, which is leading to the increasing demand for electric powertrains.

LAMEA Electric Powertrain Market Trends

The LAMEA electric powertrain market was valued at USD 5.92 billion in 2023 and is anticipated to reach around USD 28 billion by 2033. The LAMEA market is at the forefront of the automotive industry transformation, ushering in an era of more sustainable mobility solutions. The LAMEA market has experienced significant growth due to growing environmental concerns and government support. In 2020, as per the International Trade Administration, Saudi Arabia accounted for around 35% and 52% of the vehicle sales in the Gulf Cooperation Council and the Middle East and North Africa regions, respectively.

The introduction of electric vehicles in Dubai is propelled by innovations in electric vehicles, such as improvements in battery and housing technologies. According to the Dubai Water and Electricity Authority, the number of electric vehicles in Dubai is expected to be around 7,331 in 2023 and 12,852 in 2025. In September 2024, Horse, a joint venture between Geely and Renault, supplied an extended-range electric vehicle (EREV) powertrain to Brazil's newest electric vehicle manufacturer, Lecar. The Lecar 459 Hybrid, scheduled to launch in 2026, would be Lecar's first vehicle. In addition, EVM Africa is an East African company that assembles electric vehicles locally in Kenya and serves the COMESA region.

Electric Powertrain Market Top Companies

• Mitsubishi Electric Corp
• Magna International Inc.
• Nissan Motor Co., Ltd.
• Tesla Inc.
• Cummins Inc.
• Hitachi Astemo Americas, Inc. 
• Schaeffler AG
• ZF Friedrichshafen AG
• BorgWarner
• Hyundai Motor Company
• Volkswagen
• IET S.p.A. 
• Bosch Limited
• Valeo
• Nidec Corporation
• GKN PLC
• Continental AG
• Magneti Marelli Ck Holdings
• Sigma Powertrain, Inc.
• Eaton
• Delta Electronics, Inc.
• NXP Semiconductors

Dominant market players including Tesla Inc, Continental AG, Robert Bosch GmbH, Zf Friedrichshafen AG, and Borg Warner Inc are actively participating in strategic initiatives such as mergers and acquisitions, facility expansions, and partnerships to expand their product portfolio, reach a wider customer base and strengthen their market presence.

In January 2024, VinFast, a Vietnamese electric vehicle manufacturer, signed a memorandum of understanding with the state government of Tamil Nadu to develop electric vehicle manufacturing facilities in India.

In October 2020, Continental AG announced the launch of a new transmission control system from Vitesco Technologies under the Powertrain business unit of Continental AG. It is the world's first transmission control system of its kind owing to the application of over-molding control electronics technology.

In August 2020, Magna International Inc. declared intentions to grow its powertrain division. The Slovakian manufacturing facility was being built by the company for developing metal-forming solutions for powertrains.

The market players are making constant investments in R&D to enhance their electric powertrain systems and stay ahead of the competition.

CEO Statements

Akio Toyoda, CEO of Toyota:

"Just like the fully autonomous cars that we are all supposed to be driving by now, EVs are just going to take longer to become mainstream than media would like us to believe."

Patrice Haettel, of powertrain producer, HORSE:

"Internal combustion engines (ICE) and hybrids are expected to remain significant players in the automotive industry for many years. Our long-term projections suggest that by 2040, over 50% of  passenger and light commercial vehicles globally will still rely on these technologies."

Recent Developments

Key players in the electric powertrain market are pivotal in delivering a variety of innovative construction solutions, such as prefabrication techniques, sustainable materials, and advanced digital technologies. Some notable developments in the market include:

• In July 2024, Volkswagen won the Automotive INNOVATIONS Award 2024 for being the most innovative volume brand in electric powertrains. The Center of Automotive Management (CAM) gives this award every year. The CAM praised Volkswagen for its extensive innovations in electric mobility technology. Key improvements include better range, optimized power consumption, and improved charging capacity.
• In June 2024, Marelli secured a major contract from a leading global automaker to provide the Battery Thermal Plate (BTP) for upcoming battery electric vehicles (BEVs). This solution, which is critical for managing thermal energy in electric vehicles, has been developed by Marelli and will be manufactured by Marelli in-house. Starting in 2024, Marelli will supply around 5 million units over the entire contract period.
• In March 2024, Nissan Motor Co Ltd, a leading Japanese automaker, announced its intention to launch three all-new models in India by FY2026. As part of its revised global business strategy, the company aims to position India as a major export hub, increase its overall value, and strengthen its competitiveness.
• In September 2023, a joint venture between South Korea's LG Electronics Inc. and Canada's Magna International Inc., LG Magna e-Powertrain Co., announced strategies to develop an electric vehicle parts factory in Hungary, following the home appliance giant's push to lead the world's future mobility sector.

These advancements mark a notable expansion in the electric powertrain market, driven by strategic acquisitions and innovative projects. The focus is on boosting sustainability, enhancing construction efficiency, and broadening product offerings to meet diverse building needs.

Market Segmentation

By Type

• BEV
• HEV
• PHEV
• FCEV

By Component 

• Power Electronics Controller
• Motor/Generator
• Converter
• Battery
• Transmission
• On-Board Charger

BEV Electric Powertrain, By Component

• Motor/Generator
• Battery Pack
• Battery Management Systems
• Power Electronics Controller
• Converter
• Transmission
• On-Board Charger

FCEV Electric Powertrain, By Component

• Fuel Stack
• Fuel Processors
• Power Electronics
• Air Compressors
• Humidifiers

By Region

• North America
• Europe
• APAC
• LAMEA