February 22, 2024

Micro Electric Vehicle (EV) Market Set for Remarkable 12.9% CAGR Growth, Expected to Reach US$20.8 Billion by 2030

The global micro electric vehicle (EV) market is poised for substantial growth, with an impressive CAGR of approximately 12.9% expected during the forecast period from 2023 to 2030. By the end of 2030, the market is projected to attain a value of approximately US$20.8 billion. Micro EVs, characterized by their compact size and eco-friendliness, have gained popularity as environmentally conscious transportation solutions.

Key Market Insights:

  • The market is expected to experience over a twenty-fold expansion in revenue between 2023 and 2030.
  • The market’s growth can be attributed to the global increase in demand for electric vehicles and a growing awareness of sustainable transportation options.
  • Lithium-ion battery technology is pivotal to the micro EV industry’s continuous growth.
  • Commercial use applications held the largest share of the micro EV market revenue in 2022.
  • Asia Pacific is poised to maintain leadership, with the North America micro EV market expected to exhibit the most robust growth by 2030.

Government Policies and Incentives Drive Market Growth:

Governments around the world are playing a crucial role in the growth of the micro EV market by enacting supportive legislation and offering incentives to promote the use of electric vehicles, particularly micro EVs. These incentives include tax breaks, refunds, and subsidies for consumers and manufacturers. To address concerns like high initial costs and limited charging infrastructure, governments have implemented various policies and incentives to encourage the adoption of micro EVs. For example, the UK government has outlined its vision for transitioning to zero-emission vehicles and has taken steps to enhance the electric vehicle charging infrastructure.

In the United States, government subsidies and incentives have been introduced to encourage the purchase of electric vehicles, including the elimination of manufacturer sales restrictions and the expansion of eligible vehicle categories. Such initiatives are expected to foster the growth of the micro EV market.

Increasing Environmental Awareness Fuels Demand:

Growing environmental consciousness is a significant driver of the micro EV market. With heightened awareness of climate change and environmental degradation, individuals and nations are seeking ways to reduce their carbon footprints. Micro electric vehicles offer a sustainable and pollution-free mode of transportation, reducing reliance on fossil fuels.

Several countries are adopting plans to phase out petrol and diesel-powered vehicles over the next few decades, emphasizing the transition to electric vehicles. For example, the European Union has committed to phasing out new fossil-fuel vehicles by 2035, a move that has been echoed by other nations. As urban areas strive to reduce noise pollution, micro EVs are gaining popularity due to their quiet operation. The rise of shared mobility services further underscores the growing demand for eco-friendly transportation solutions.

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Market Challenges:

Indirect Environmental Impact Concerns:

One significant challenge facing the global micro EV industry is the indirect environmental impact associated with the electricity infrastructure that powers these vehicles. While electric vehicles themselves do not directly harm the environment, the source of the electricity used for charging can have indirect consequences. Power grids that rely on coal as a fuel source can release large amounts of toxic gases, contributing to poor air quality and health issues. Additionally, the manufacturing of batteries for electric vehicles can have environmental implications.

Addressing these indirect environmental impacts and transitioning to cleaner sources of electricity generation is a challenge that the industry must navigate to ensure the long-term sustainability of micro EVs.

Overview of Key Segments:

Lithium-ion Battery Category Dominates:

In 2022, the lithium-ion (Li-ion) battery category held the largest market share, driven by the increasing sales and demand for battery-powered vehicles. Stringent emissions regulations, improved fuel efficiency, and government incentives are contributing to the growth of this segment. Government initiatives in countries such as China, Japan, and Singapore have eliminated or significantly reduced taxes on electric vehicle purchases, encouraging consumer adoption. The micro EV market is also benefiting from partnerships between battery manufacturers and original equipment manufacturers (OEMs). The growing popularity of micro-hybrid vehicles, which are anticipated to account for a significant portion of all new cars globally by 2030, is further boosting demand for Li-ion batteries.

Micro EVs in Commercial Applications Lead:

The commercial application segment of the micro EV market took the lead in 2022. Increasing government efforts to reduce carbon emissions from transportation sources are expected to drive significant growth in this market. Initiatives such as the proposed ban on non-electric vehicles in Paris by 2028 and similar measures in other regions are likely to bolster demand for micro EVs in urban areas. Micro electric vehicles are increasingly used in civil applications, including passenger transportation, law enforcement, and firefighting, offering benefits such as reduced pollution, lower noise levels, and reduced operating costs compared to conventional vehicles.

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Growth Opportunities Across Regions:

Asia Pacific Leads the Way:

Asia Pacific is poised to offer the most substantial growth prospects in the micro EV market. China, in particular, represents a significant portion of the market due to robust sales of hybrid vehicles. A growing population, stringent government emission standards, and supportive government policies, including subsidies and tax incentives, are contributing to the region’s strong market presence. India has also mandated compliance with BS-VI emissions standards, further boosting the market. The region’s favorable conditions for micro EV adoption are expected to continue driving growth.

North America Presents Lucrative Opportunities:

The North American micro EV market is anticipated to experience a significant CAGR during the forecast period. The United States and Canada are key contributors to the market, with demand for quadricycles, electric golf carts, and mobility vehicles for individuals with impairments driving revenue. Government initiatives aimed at reducing greenhouse gas emissions and promoting electric vehicle adoption are supporting market growth. The United States, in particular, has introduced various programs to stimulate the automotive sector, making micro EVs a suitable mode of transportation for short urban journeys.

Micro EV Market: Competitive Landscape:

Leading players in the micro EV market include Polaris Inc., Club Car, Italcar Industrial S.r.l., Micro Mobility Systems Ltd., Zhejiang Geely Holding Group Co., Ltd., SAIC-GM-Wuling, Toyota Motor Corporation, Stellantis N.V., and Eli Electric Vehicles.

Browse Global Micro EV Industry Analysis, Size, Share, Growth, Trends, Regional Outlook, and Forecast 2023-2030 – (By Battery Type, By Application, By Geographic Coverage and By Company): https://www.fairfieldmarketresearch.com/report/micro-ev-market

 

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This press release first seen on Brilad