To conduct the market analysis, I focused on developing a comprehensive understanding of the current electric vehicle market landscape and identifying key trends that will influence future market opportunities and challenges. The analysis involved collecting both primary and secondary data from a variety of reputable industry sources.
On the primary research front, I conducted in-depth interviews with 20 electric vehicle manufacturers, battery suppliers, charging network operators, and automotive industry analysts to understand their perspectives on industry drivers and barriers. I asked about topics like production and sales forecasts, battery technology advancements, charging infrastructure buildout plans, regulations supporting adoption, and competition from traditional gasoline vehicles. These interviews provided crucial insights directly from industry leaders on the front lines.
On the secondary research side, I analyzed annual reports, SEC filings, industry surveys, market research studies, news articles, government policy documents and more to build a factual base of historical and current market data. Some of the key data points examined included electric vehicle sales trends broken out by vehicle segment and region, total addressable market sizing, battery cost and range projections, charging station installation targets, consumer demand surveys and macroeconomic factors influencing purchases. Comparing and cross-referencing multiple sources helped validate conclusions.
Key findings from the comprehensive market analysis included:
The total addressable market for electric vehicles is huge and growing rapidly. While electric vehicles still only account for around 5-6% of global vehicle sales currently, most forecasts project this could rise to 15-25% of the market by 2030 given accelerating adoption rates in majorregions like China, Europe and North America. The EV TAM is estimated to be worth over $5 trillion by the end of the decade based on projected vehicle unit sales.
Battery technology and costs are improving at an exponential pace, set to be a huge tailwind. Lithium-ion battery prices have already fallen over 85% in the last decade to around $100/kWh currently according to BloombergNEF. Most experts anticipate this could drop below $60/kWh by 2024-2026 as manufacturing scales up, allowing EVs to reach price parity and become cheaper to own versus gas cars in many market segments even without subsidies.
Consumer demand is surging as barriers like range anxiety fall away. Highly anticipated new electric vehicle models from Tesla, GM, Ford, VW, BMW and others are receiving massive pre-order volumes in key markets. More than 80% of US and European consumers surveyed in 2020 said they would consider an EV for their next vehicle purchase according to McKinsey, a huge jump from just 3-5 years ago.
Charging networks are expanding rapidly to support greater adoption. The US and Europe each have public fast-charging station installation targets of 1 million or more by 2030. Companies like EVgo and ChargePoint in the US, Ionity and Fastned in Europe are investing billions to deploy high-powered charging corridors along highways as well as city locations like malls and workplaces.
Government policy is supercharging adoption through large purchase incentives and bans on gas vehicles. Countries like UK, France, Norway, Canada and China offer $5,000-$10,000+ consumer rebates for electric vehicles. Meanwhile, the UK and EU have set 2030-2035 phaseout dates for new gas/diesel vehicle sales. The current US administration is also set to boost EV tax credits as part of infrastructure programs.
Traditional automakers are amping up massive electric vehicle production plans. VW Group alone has earmarked over $40 billion through 2024 towards developing 70+ new EV models and building 6 “gigafactories” in Europe. GM, Ford and others will collectively spend $300+ billion though 2025 on EV/battery R&D and manufacturing capacity worldwide. This is set to address concerns around scale and selection holding back some early adopters.
The market data tells a clear story of explosive electric vehicle market growth on the horizon driven by technological breakthroughs, policy tailwinds, automaker commitments and skyrocketing consumer demand – representing a trillion dollar economic opportunity for early moving companies across the electrification value chain from batteries to charging to vehicles. While challenges around charging convenience and upfront purchase costs still remain, the fundamentals and momentum strongly indicate EVs will reach mainstream adoption levels within the next 5-10 years.