Electric Vehicle Power Inverter Market (By Propulsion: Hybrid Electric Vehicles, Plug-in Hybrid Electric Vehicle, Battery Electric Vehicle, Fuel Cell Electric Vehicle; By Inverter Type; By Integration Level; By Vehicle Type; By Distribution) - Global Industry Analysis, Size, Share, Growth, Trends, Revenue, Regional Outlook and Forecast 2022-2030

The global electric vehicle power inverter market was surpassed at USD 8.7 billion in 2021 and is expected to hit around USD 21.54 billion by 2030, growing at a CAGR of 10.6% from 2022 to 2030.

Electric Vehicle Power Inverter is defined as electrical device which converts DC (direct current) source to alternating current (AC) and it is used in electric vehicle motor. There are various types of inverters that are used in electric vehicles including traction inverter, and soft switching inverter. These inverters help to generate very high current during the time of switching the engine as generated voltage & input voltage. Factors like the huge amount of domestic automakers & the consolidation of prominent battery makers are expected to contribute the electric vehicle power inverter market growth.

Scope of The Report

Key Market Trends

Growing Sales of Electric Vehicles

Electric vehicles have become an integral part of the automotive industry, and they represent a pathway toward achieving energy efficiency, along with reduced emission of pollutants and other greenhouse gases. The increasing environmental concerns, coupled with favorable government initiatives, are some of the major factors driving the market growth.

Global EV sales was marked at 8.98 million units during 2021, which was significantly higher compared to sales figure in 2020. The volume includes all segments including passenger vehicles, light commercial vehicles and light trucks and all propulsion types.

The movement to accelerate the adoption of light-duty passenger electric cars (EVs) and phase out traditional vehicles with internal combustion engines is gaining traction around the world. The increase in average fuel prices reflects the fact that Europe has a higher share of new electric car registrations than other parts of world. Hence, mass adoption of electric vehicles, owing to rising fuel prices, is expected to proliferate business globally. EV is furthermore driven by the increasing sales of BEVs and PHEVs globally has also remained a major cause for bolstering the electric vehicles demand. Manufacturers around the globe has consistently driven the demand for EV. For instance:

• During the end of FY21, Hyundai sold 313,933 cars globally in the March. The sales statistics stood at a drop of 17% compared to previous years. The sales were even less than Q1 2021. Moreover, Hyundai observed that its automotive segment witnessed a sharp rise with almost doubled sales figure for its all-electric cars. This in turn makes its sales figure for its BEV to stood at 11,451 units with a rise of 105%. In addition, the plug-in electric cars increased to 14,693 units to 58% year and year growth.
• In Q1, 2022 Volkswagen Group which includes Volkswagen, Audi, Porsche, Skoda, SEAT reported a net sales of 99,108 units under its BEV segment. This showcases a steep rise of 65.2 % year on year growth rate. In FY2021, Volkswagen Group has sold a record-breaking number of its plug-in electric vehicles roughly 762,400 units.

Moreover, the high cost associated with batteries has necessitated the improvement of inverters and other power electronics, along with improving the performance of vehicles. For instance,

• According to the International Energy Agency, approximately 1.84 million electric vehicles were registered in the United States by 2020, more than three times as many as in 2016. In 2020, electric vehicle sales were approximately 2.4% of the total vehicle sales, an increase from about 2% in 2019. In 2020, 295,043 new electric cars were registered, of which about 78% were BEVs, down from 327,336 in 2019.
• Shifting customer preference towards electric vehicles is an evident sign for future decarbonization and simultaneously decisive for charging stations, although penetration of EVs is subjected to various attributes, including consumer behavior, infrastructure, and certain regional clusters. An increase in electric vehicles sales will proportionally fuel the demand for charging stations. Prominent players in the market have diagnosed the pinpoint of consumer sentiment and thus are focusing on catering to it by offering fast charging technologies across the country.

Though change has not resulted in a slump in IC engine vehicle sales, it created a promising market for electric vehicles in the present and future. The above trend has propelled some of the automakers to increase their expenditure on R&D in electric vehicles and associated components, like power inverters, while others have started focusing on launching new products to capture the market share, eventually pushing the demand in the market.

Market Dynamics

Drivers

Increased Sales of Electric Vehicles

The automobile industry has embraced electric vehicles as a necessary component, offering a method to improve energy efficiency and reduce emissions of pollutants and other greenhouse gases. The rising environmental concerns and supportive government initiatives are vital elements fueling market expansion. The market is further driven by the increasing sales of BEVs and PHEVs and reduced cost of inverter components due to advancements in materials and improved packaging arrangement. Moreover, the high price associated with batteries has necessitated the improvement of inverters and other power electronics, along with improving the performance of vehicles.

Governments worldwide have also initiated various schemes and policies that encourage buyers to choose electric vehicles over conventional ones. California ZEV program, which aims at having 1.53 million electric vehicles on the road by 2025, is one such initiative that promotes the purchase of electric vehicles. Countries like India, China, the United Kingdom, South Korea, France, Germany, Norway, and the Netherlands, are other countries that have various incentives for people willing to buy electric vehicles. Rapid global sales expansion and the ongoing technological developments in power inverters of electric vehicles are expected to fuel the market's growth over the forecast period.

Improved Investments in Electric Vehicles

The electric vehicle market is growing, likely accelerating further over the forecast period. This is because most vehicle manufacturers and the associated industries see electric vehicles as an investment opportunity. This growth is driving the electric vehicle and EV charging station market. China is the most promising market for electric buses globally, likely driving the e-bus demand over the forecast period. The overall bus purchases in the country are expected to remain stable, with more than 400,312 new purchases expected by 2025. Sales of electric buses are anticipated to rise due to ongoing government initiatives to foster e-mobility. By 2040, the global adoption of e-buses is expected to account for 40% of all new bus purchases.

Thailand is the 11th largest automotive producer in the world and the leading producer of vehicles in the ASEAN (Association of Southeast Asian Nations) area. In March 2020, the Thailand Board of Investment announced that Thailand received significant foreign direct investments supporting the country's growing electric vehicle production system. The Electric Vehicle Association of Thailand reports a sharp increase in the number of businesses involved in Thailand's electric vehicle market since 2015. Increasing focus on electric vehicles bring more opportunities for spare part manufacturers, and the ongoing technological developments in power inverters of electric vehicles are expected to fuel the growth of the market studied over the forecast period.

Restraint

Lack of Sufficient Infrastructure for Electric Vehicles

For electric car adoption, a robust infrastructure for charging EVs is required. Despite their advantages from an environmental and financial standpoint, electric vehicles have not yet become mainstream. A lack of charging outlets constrains the electric vehicle business. For instance, a survey by Grant Thornton-Bharat and the Federation of Indian Chambers of Commerce & Industry (FICCI) predicted that by June 2021, India would need 4 lakh public charging stations to support the estimated 2 million electric vehicles that would be driving in Indian roads by that year. India only has 1,028 public electric vehicle charging points as of December 2021.

In addition, a report from the International Energy Agency (IEA) in 2021 stated that the number of electric vehicles worldwide reached 10 million in 2020, up 43% from 2019 and acquiring a 1% market share. In 2020, battery electric vehicles (BEVS) accounted for two-thirds of the stock and new electric car registrations. As a result, electric vehicle growth is slowed, making it difficult for the market for electric vehicle power inverters to thrive. Consequently, this has a negative effect on the production and acceptance of electric vehicles, which in turn restrains the expansion of the market for EV power inverters. Therefore, such an imbalance between the need for charging and the distribution of infrastructure discourages the manufacture of electric vehicles and further impediments the market's expansion.

Opportunities

Increased Government and Consumer Spending

Governments across the globe are incentivizing electric car purchases with tax deductions. In 2020, globally, the governments spent USD 14 billion on direct investment and incentives and tax deductions for electric cars, an increase of 25%. Significant government spending took place in Europe. Spending decreased in China to lower incentive schemes rolled out earlier to boost sales. Electric cars witnessed a slight price decline due to price caps introduced for subsidies. This resulted in a 3% decrease in the price of BEVs and an 8% fall in the price of PHEV cars in Europe and China. In December 2021, India announced a tax exemption of INR 1,50,000 to increase the sales of electric vehicles.

Improving business sentiments, post-COVID recovery, and increasing awareness about green vehicles have increased consumer spending on electric vehicles. The uptick in EV sales offers excellent opportunities for EV parts manufacturers, including power inverter manufacturers. In 2020, there was overall spending of USD 120 billion on electric cars, which was a 50% increase from 2019. Sales increased despite the hike of 6% in the average price of electric vehicles. Such spending provides lucrative market growth opportunities.

Market Insights

Propulsion Insights

Based on Propulsion, the market is segmented into Hybrid Electric Vehicle, Plug-in Hybrid Electric Vehicle, Battery Electric Vehicle, and Fuel Cell Electric Vehicle. Out of which, Hybrid Electric Vehicle segment is expected to dominate the global market over the forecast period and this is attributed to the growing sales of HEVs around the world. For instance, the U.S. witnessed increased hybrid vehicle sales with 454,721-units sold as compared to 380,813-units sold in 2019.

Plug-in Hybrid Electric Vehicle segment is also expected to witness significant growth in the near future owing to the rise in demand for enhanced vehicle performance, better driving experience and improved economy.

Inverter Type Insights

Based on Inverter Type, the Electric Vehicle Power Inverter Market is classified into Traction Inverter and Soft Switching Inverter. In 2021, the traction inverter segment witnessed the largest revenue share of the electric vehicle power inverter market. The traction inverter’s function is to change the DC current from the battery of an electric car into AC current so that it may be utilized to power the electric motor that powers the car’s propulsion system.

Integration Level Insights

Based on Integration Level, the Electric Vehicle Power Inverter Market is segmented into Integrated Inverter System, Separate Inverter System, and Mechatronic Integration System. In 2021, the integrated inverter system segment held the highest revenue in the electric vehicle power inverter market. Its structure largely consists of integrating an output current shaping function and recently developed maximum point tracking technique into a converter formed from a buck-boost and then inverting the shaped current across a grid frequency bridge to the grid.

Vehicle Type Insights

Based on Vehicle Type, the market is segmented into Passenger Cars and Commercial Vehicles. Out of which Passenger Cars segment is anticipated to dominate the global market during the forecast period and this is attributed to rise in demand for fuel, hybrid and electric passenger cars around the world. For instance, in 2020, the registration of BEVs accounted for 54% of all electric car registration in European countries, which exceeded plug-in hybrid car vehicles.

Distribution Insights

Based on Distribution, the Electric Vehicle Power Inverter Market is bifurcated into OEM and Aftermarket. In 2021, the OEM segment acquired the largest revenue share of the electric vehicle power inverter market. The primary advantage of OEM items is their cost. OEM products drastically lower the cost of production due to economies of scale. Additionally, the business buying these items can use them to create systems without having to run their own factories and this factor is propelling the growth of this segment of the market.

Regional Insights

Based on Region, the Electric Vehicle Power Inverter Market is segregated into North America, Europe, Asia-Pacific, and LAMEA. In 2021, Asia-Pacific accounted for the largest revenue share of the electric vehicle power inverter market. The electric vehicle power inverter market is expanding quickly in China and India owing to the rapid expansion of the automotive industry in the region as well as government subsidies and incentives for electric vehicles.

The market research report covers the analysis of key stake holders of the market. Key companies profiled in the report include Siemens AG, Continental AG, Robert Bosch GmbH, Denso Corporation, Valeo SA, Mitsubishi Electric Corporation, Aptiv PLC, Toyota Industries Corporation, Nissan Motor Corporation and Marelli.

Key Players

• Aptiv
• Continental AG
• DENSO Corporation
• Hitachi Automotive Systems Ltd
• Infineon Technologies AG
• Meidensha Corporation
• Mitsubishi Electric Corporation
• Robert Bosch GmbH
• Toyota Industries Corporation
• Valeo Group

Market Segmentation

• By Propulsion
  • Hybrid Electric Vehicles
  • Plug-in Hybrid Electric Vehicle
  • Battery Electric Vehicle
  • Fuel Cell Electric Vehicle
• By Inverter Type
  • Traction Inverter
  • Soft Switching Inverter
• By Integration Level
  • Integrated Inverter System
  • Mechatronic Integration System
  • Separate Inverter System
• By Vehicle Type
  • Passenger Cars
  • Commercial Vehicles
• By Distribution
  • Aftermarket
  • OEM

• By Region
• North America
• U.S.
• Canada
• Europe
• Germany
• U.K.
• France
• Italy
• Spain
• Russia
• Asia Pacific
• Japan
• China
• India
• Australia
• Singapore
• South Korea
• Latin America
• Mexico
• Brazil
• Argentina
• MEA
• South Africa
• Saudi Arabia
• UAE