2021 is going to be an exciting year for the electric vehicle (EV) industry. The fast-paced acceleration of the mobility transformation in the past decade, combined with the financial pressure amplified by the pandemic, is directing manufacturers to redefine their priorities. Many are committing to the electrification and hybridization of their fleets, buoyed by the rising demand for less expensive, environmentally-friendly vehicles.
In 2020, global sales of battery electric vehicles (BEV) and other EVs hit $2.5 million. This is expected to rise by about 70% this year. Europe and China will account for the biggest market shares, with North America, South Korea, and Japan following behind. Europe’s stringent CO2 regulation, as well as the prioritization of new energy vehicles (NEVs) in China, are expected to further increase VE’s global growth. By 2025, anticipated sales worldwide will top $12.2 million.
In the United States, 75 fully electric and plug-in hybrid (PHEV) auto models are set to enter the market. EV giant Tesla will face tough competition from start-ups like Rivian, Fisker, and Lucid, driving a more balanced environment. Expansions like the pickup truck segment may serve as a stimulus for further growth. The electric aviation industry will also continue to pick up, with electric vertical takeoff and landing (eVTOL) aircraft playing a major role.
While there are many factors that may foster EV’s growth in various directions in 2021, the following trends will help visualize how the market will take shape not only this year, but over the next decade.
Shared mobility to rise exponentially
While the sharing economy hit a slump when the pandemic struck, it is set to become bigger now that the vaccines are soon to enter mainstream distribution and economies worldwide are recovering. Currently, sharing mobility accounts for around 5% of passenger vehicle miles. By 2040, this will rise to 19% of total annual mileage. EVs are expected to benefit, as they are considered to be more favorable with their lower fuel and maintenance cost.
The climbing cost of owning a vehicle will hike the demand for ride-hailing services. EVs’ share in the mobility fleet is at 1.8%, but this will balloon to 80% by 2040. The rising demand for cost- and time-saving transport will continue to drive the market. The call for reduced traffic for environmental concern across the globe and the government regulations promoting ridesharing options will also tip the scales in EVs ’ favor.
Purpose-built vehicles is an emerging market expected to gain popularity in the upcoming years. Compared to conventional autos, vehicles used exclusively for ride-sharing purposes are around 25% cheaper. Companies like Toyota, Indian start-up Ola and and China’s DiDi have previously announced investment on custom-made electric cars for ride-hailing services. The market is expected to be about $2.5 million by 2025.
eVTOL as wildcard
As the urban air mobility (UAM) market continues to grow, electric vertical takeoff and landing (eVTOL) aircrafts are expected to gain more followers. eVTOLs stand to benefit from the rising demand for efficient transport that offers sustainable solutions to traffic congestion worldwide. The global eVTOL market is promising, anticipated to reach $87.6 million by 2026. In a year or two, we may be seeing air taxis and passenger drones cruising our skies.
Many air mobility companies are just waiting for certifications from agencies like the Federal Aviation Administration (FAA) and the European Aviation Safety Agency (EASA) to roll out their eVTOLs. Plans for deployment are set mid to late 2020s. Consumers are attracted to eVTOLs many advantages, including convenience, flexibility and fast travel. Reduced air pollution is also a deciding factor to many.
Astro Aerospace (OTC:ASDN) is one of the global leaders in the eVTOL industry. It is the developer of ELROY, one of the first fully functional eVTOLs in the world. Small enough to fit into most garages, this autonomous aircraft has a 360° surround view cabin and can carry two passengers. Astro conducted a successful test flight series with ELROY 2018. The Texas-based company plans to fly its second prototype eVTOL mid-year.
Low-cost over high-priced
The high manufacturing cost of electric vehicles has been one of the major concerns for adoption. However, not all models of EVs are luxurious. Companies like ElectraMeccanica have developed EVs with more appealing price points. The Canadian manufacturer, for instance, has rolled out a single-seat EV that cost a fraction of the price tag of luxury brands like Tesla. Designed for efficient city transportation, the Solo can be purchased for less than $20,000.
Moreover, as the popularity of EVs continue to soar, prices are likely to equalize with conventional automobiles. Increase in production volume and drops in research and development (R&D) expenses will make EVs more affordable over time. As battery technologies continue to mature, the prices will also reduce. Of course, mid-priced EVs tend to put less emphasis on features like infotainment.
Charging stations for electric vehicles have also turned to renewable energy like solar panels. Installation of such will be cheaper and less complicated. With this, they are becoming the ideal choice both for residential and commercial buildings. Future consumers will also be happy to note that recent developments in technology have paved the way for huge increases in vehicle range per single charge.
Chinese EV growth to ramp up again
China is proving to be a worthy contender for the most advanced electric vehicles this decade. Production volumes for battery electric vehicles (BEV) is forecast to hit 4.8 million units, while plug-in hybrid electric vehicles (PHEV) volumes are to reach 1.6 million units. Meanwhile, sales of Chinese EVs are anticipated to rise by 40% at 1.8 million units. This may be attributed to the country’s table economic growth and phasing in of new energy vehicle requirements.
NIO Limited, tagged as the Chinese Tesla, has recently unveiled its first electric sedan model. Said to rival the E-class sedans of huge brands like BMW and Audi, the ET7 features a new battery technology that will give it a drive range of over 1,000 km (621 miles) for a single charge. It will also be fitted with lidar sensors for driver assistance. In 2020, NIO delivered more than 40,000 EVs. Its market value is over $92 billion.
XPeng Motors is also set to roll out its latest EV this year. The Guangzhou-based company has recently announced the launching of a new sedan model in addition to its sports sedan and compact SUV lineup. XPeng reportedly raised more than half of a billion dollars from investors like Aspex and Hillhouse Capital in 2020. It also bagged funding from international organizations like Qatar Investment Authority and Abu Dhabi’s Mubadala.