Electric Three Wheeler Market Size Expected to Rise Worth USD 831.10 million by 2028 at a CAGR of 5.2%
Fortune Business Insights
Updated 8 min read
Fortune Business Insights
Electric Three Wheeler Market to Reach USD 831.10 million by 2028; Increasing Demand for Electrical Vehicles to Augment Market Growth: Fortune Business Insights™
Pune, India, March 08, 2023 (GLOBE NEWSWIRE) -- The global electric three wheeler market size was USD 574.96 million in 2020 and market is expected to grow from USD 582.46 million in 2021 to USD 831.10 million in 2028, growing at a CAGR of 5.2% in the 2021-2028 period. This information is provided by Fortune Business Insights, in its report titled, “Electric Three Wheeler Market, 2021-2028.”
The increasing demand from Electric three wheeler scooter over traditional ones is expected to drive market growth. Compared to the traditional three-wheelers, the average operation and maintenance costs of an electric three-wheeler are substantially low. Thus, demand for these has increased.
Electric Three Wheeler Market Size, Share & COVID-19 Impact Analysis, By Battery Type (Lithium-ion and Lead Acid), By Power Type (Up to 1000 W, 1000 W to 1500 W, and Above 1500 W), By End Use Type (Passenger Carrier and Goods Carrier).
Growth Drivers
Increased Government Initiatives and Subsidies to Promote Electric Three-Wheelers to Drive Growth
Based on the battery type, the market is segmented into lithium-ion and lead-acid batteries. The lithium-ion segment holds the largest share in the global market for electric three wheelers.
Market Drivers and Restraints:
Increased Government Initiatives and Subsidies to Promote Electric Three-Wheelers to Drive Growth
The increasing demand for electric vehicles is expected to drive the electric three wheeler market growth. Moreover, initiatives by several governments, such as subsidy schemes and multiple reimbursement policies are expected to boost the market. For instance, the Indian government announced the launch of Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME India) in 2015. This scheme offers monetary incentives for the purchase of electric and hybrid electric vehicles.
The electric three-wheeler industry has witnessed rapid growth in recent years due to various drivers and restraints. One of the primary drivers of this industry is the government incentives and policies promoting the adoption of electric vehicles. Governments worldwide have introduced tax exemptions, subsidies, and financial incentives to create a favorable environment for the growth of the electric three-wheeler industry. Additionally, the growing environmental concerns and the adverse effects of fossil fuels have led to an increasing demand for eco-friendly transportation solutions. The zero-emission nature of electric three-wheelers has made them a popular choice for consumers.
Another driver of the electric three-wheeler industry is its cost-effectiveness. Electric three-wheelers have a lower operating cost compared to traditional three-wheelers, which makes them a cost-effective option for transportation. With the rising fuel prices and maintenance costs of conventional three-wheelers, consumers are opting for electric three-wheelers. Furthermore, the increased demand for last-mile connectivity has made electric three-wheelers an ideal solution, especially in densely populated areas. With the growth of e-commerce and online deliveries, the demand for efficient and cost-effective last-mile connectivity solutions has increased.
However, the electric three-wheeler industry faces several restraints that limit its growth potential. One of the significant restraints is the limited range and charging infrastructure. The limited range of electric three-wheelers and the lack of adequate charging infrastructure pose a significant challenge to the growth of the industry. Range anxiety and the time taken for charging are still major concerns for consumers. Another restraint is the higher upfront cost of electric three-wheelers compared to traditional three-wheelers. This makes it a challenge for consumers to switch to electric three-wheelers.
Limited awareness and availability of electric three-wheelers in some regions are still a restraint for the industry. The awareness and availability of electric three-wheelers are limited in some regions, making it difficult for consumers to opt for electric three-wheelers. Lastly, the lack of standardization in electric three-wheeler components such as batteries, motors, and controllers poses a significant challenge for the industry. The lack of standardization makes it difficult for manufacturers to scale up production and increase efficiency.
COVID-19 Impact
The outbreak of the coronavirus has affected the market negatively. China is known to contribute around 75% of the global lithium manufacturing capacity. Since, this region was hit by the virus badly, this impacted the market. The whole world resulted in a severe lithium supply shortage for electric vehicle manufacturers dependent on China for lithium cells and other raw supplies. However, the market is expected to revive during the forecast period.
In the electric three-wheeler market analysis, the market is segmented based on the type of battery, power capacity, and end-use.
The battery type segment is further divided into two categories, lithium-ion and lead-acid batteries. The lithium-ion battery segment is expected to witness higher growth due to its longer life span, high energy density, and lower maintenance cost compared to lead-acid batteries.
The power capacity segment is categorized into three types: up to 1000 W, 1000 W to 1500 W, and above 1500 W. The above 1500 W segment is projected to grow at a faster pace owing to its higher power capacity and ability to carry heavier loads.
The end-use segment is divided into passenger carrier and goods carrier. The passenger carrier segment is anticipated to hold a larger share due to the increasing demand for eco-friendly public transport options, while the goods carrier segment is expected to witness growth due to the rising need for efficient last-mile delivery solutions.
Regional Insights:
Asia Pacific to Dominate Backed by Presence Large Number of Turbine Plants
Asia Pacific is expected to remain at the forefront and hold the largest position in the market during the forecast owing to the high demographic growth, a larger middle and lower-middle-class income population, and increasing inclination towards electrification of vehicles in this region. The region’s market stood at USD 514.46 million in 2020.
Europe is expected to showcase significant market share in upcoming years, owing to the rapid adoption of vehicle electrification in this region. Electric three-wheeler manufacturers are investing exponentially in R&D for innovating technologically advanced mobility solutions.
Report Coverage
The market report offers a comprehensive analysis of various factors such as the key drivers, and restraints which are likely to impact the market growth in upcoming years. The report also provides insights of different regions that are contributing to the growth of the market. It includes the competitive landscape that involves the leading companies and the adoption of strategies to introduce new products, announce partnerships, and collaboration to contribute to the market growth.
Competitive Landscape:
Key Players to Focus on New Launches to Strengthen their Market Prospects
The market is consolidated by major companies striving to maintain their position by focusing on new launches, collaborations & partnerships and acquisitions. Such strategies taken up by key players are expected to strengthen its market prospects.
KEY INDUSTRY DEVELOPMENTS:
In August 2021, the maker of the Chetak EV scooters Bajaj Auto will launch a three wheeled electric vehicle, followed by an electric quadricycle and a high-powered motorbike, which is being developed in collaboration with its Austrian partner KTM.
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