Hybrid Cars Market to Reach US$ 2.1 Trn by 2031, TMR Study
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Hybrid Cars Market Outlook 2031
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- The global hybrid cars market was valued at US$ 247.29 Bn in 2020
- It is estimated to expand at a CAGR of 21.90% from 2021 to 2031
- The global hybrid cars market is expected to cross the value of US$ 2.1 Trn by the end of 2031
Analysts’ Viewpoint on Hybrid Cars Market Scenario
Negative ramifications of the COVID-19 pandemic have compelled automotive companies to rely on local production capabilities to reduce dependence on other countries for components, reduce shipping costs, and other expenditure. Automotive companies in the hybrid cars market are increasing manufacturing capabilities for plug-in hybrids, series parallel hybrid cars, and series hybrid models. Of these, the demand for the series parallel hybrid dominates the market. The overall scenario of this market is likely to remain same in the upcoming years. However, high cost of hybrid cars is slowing down sales in developing economies such as India, Bangladesh, and Pakistan. Hence, automakers should increase awareness about fuel efficiency, resulting in lowered total cost of ownership to offset the disadvantage of high initial cost of hybrid cars.
Plug-in Hybrid Cars Hold Promising Potentials to Create Incremental Opportunities for Automakers
Fuel efficiency and affordability are advancing the outlook of the hybrid cars market. The shift from conventional gasoline powered engines to environment-friendly engines is a key driver for the market. Hybrid cars are also commonly called hybrid electric cars, as they essentially combine electric motor with a gasoline engine in some form. The major mechanism comprises recapturing power from regenerative braking system.
The hybrid cars market has been enriched by continuous focus on bringing new and improved designs to the commercialization stage. Some of the common designs are parallel hybrid, series hybrid, and plug-in hybrids. Moreover, some of the major car manufacturers have reaped revenues in the hybrid cars market by commercializing plug-in hybrids. In developed nations, players are leaning on strengthening their manufacturing capacity by shifting their units to local production. This is particularly significant from the aspect of meeting a substantial cross-section of demands in the regional markets and with reduced cost of shipping for several of the raw materials used.
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Data-driven Strategies Automakers Revive Market Economy amid COVID-19 Crisis
The recent COVID-19 pandemic has showed adverse impact on the overall growth of the global hybrid cars market. The companies engaged in this market are dealing with many issues such as sudden drop in sales, stoppage in production activities, and thereby lowered revenues. Nevertheless, market players are strategizing their moves to regain their production activities by taking all necessary precautions stated by regional government authorities. As a result, the market is expected to recover from the recent pandemic and show promising growth in the forthcoming years. Automakers are in the midst of rapid shift in supply chain planning, operations, and inventory management to address the impact of the pandemic.
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Preference for Cost Efficiency in Hybrid Cars by Environment-conscious Users
Hybrid cars refer to vehicles that utilize more than one propulsion techniques, which imply the combination of a diesel or petrol engine and electric motor. These cars are gaining traction, owing to a wide range of advantages they offer. Some of the key advantages of hybrid cars include lower wear & tear and better gas mileage. Thus, the global hybrid cars market is projected to show upward graph of sales owing to the cost-effectiveness of these cars.
In recent few years, there is a remarkable growth in awareness among worldwide population regarding environmental issues. As a result, people are inclined toward the use of products that are environment-friendly in nature. This scenario is generating prominent demand for hybrid cars from all across the globe. Owing to this factor, the global hybrid cars market is likely to grow at promising pace in the forthcoming years.
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Can Hybrid Cars Transform Future of Mobility in Near Future?
Asia Pacific dominates the market in terms of consumer awareness toward environment-friendly vehicles. In addition, increasing government support toward the purchase of hybrid cars in Japan and China is another factor likely to trigger growth of this market in upcoming years. In contrast, the hybrid cars market in Europe and North America is expected to register moderate growth rate, as the market has attained a considerable maturity level in terms of demand.
On the other hand, high cost of hybrid cars is driving the growth rate negatively. In addition, the availability of electric cars, acts as a direct substitute to hybrid cars, which is likely to impact the growth of this market. Nevertheless, the rising number of charging booth is likely to influence the global market for hybrid cars positively. Automakers should diversify their production in both hybrid and electric cars to expand their revenue streams.
Hybrid Cars Market: Overview
- Hybrid cars uses several power sources including electric motor engine, fuel-based engine, and natural gas engine. In hybrid cars, the battery is charged with the help of the internal combustion engine and regenerative braking system in the car. Moreover, hybrid cars provides more power, minimum emission and better fuel efficiency.
- Increasing need of fuel efficiency and better performance of the vehicles leads to growth of the hybrid cars market. The hybrid cars uses environment friendly engines which are compact in size, apart from this, hybrid cars also has improved aero dynamics, and less car weight as compared to IC engine cars, which leads to enhance the fuel efficiency of the vehicles. Moreover, with reduced engine size and car weight, the mileage of hybrid cars increases, which also improves the demand for the cars and further propel the growth of the market.
Drivers of Hybrid Cars Market
- Increasing demand and production capacity of hybrid vehicles across developed and developing nations led by the rising emission regulations and spike in the fuel prices, which further contributes in the growth of the global hybrid cars market. Moreover, in most of the developed nations, the car manufacturing players are focusing to strengthen their hybrid car production capacity by shifting their manufacturing units to local production and using most of local components for their car assembly, which contributes in the growth of the regional hybrid cars market. In addition, local manufacturing also reduces shipping cost and thereby, subsidize in the market growth.
- Governments across the globe are focusing to make awareness about the electric and hybrid vehicles, in order to reduce the use fuel based engine vehicles and decrease global pollution rate. Moreover, governments are also providing several benefits and incentives to vehicle manufacturers and users to enhance the production capacity and utilization of electric and hybrid vehicles. Government also implements several vehicle emission laws and regulations that enables the manufacturers to opt for hybrid vehicles production and hence, such factors further propels hybrid car market growth.
- Increasing population rate across the developing nations impels the use of vehicles and fuels the chances of more pollution in the region. Therefore, to avoid such problems, governments is taking several steps to create an awareness among to consumers to opt for low or zero emission vehicles. Moreover, rising fuel prices augments the adoption rate of electric and hybrid vehicle that further boost the growth of hybrid cars market.
Challenges for Hybrid Cars Market
- High cost associated with the production of hybrid cars and its related products is considered as one of the major challenge faced by the hybrid car manufacturers, which further restrains in the growth of the market. Apart from this, rising demand and adoption of battery electric vehicles (BEVs) across the globe due to its high performance and zero emission feature, impose a challenge for the development of hybrid cars market.
- Due to outburst of the COVID-19 pandemic, the automotive and other industries are hampered on large extend, as all the vehicle designing and manufacturing processes where stopped. Lockdown was imposed, which further hampered the demand for electric, hybrid and IC engine vehicles. Moreover, due to disruption of global supply chains, there was shortage of raw material supply, which is required for car manufacturing, which also hampered the market growth.
Hybrid Cars Market Players
- The global hybrid cars market has been segmented based on type, energy source, degree of hybridization, vehicle type, and region
- Based on type, the series-parallel hybrid car segment dominated the global hybrid cars market, in terms of revenue, in 2020. The series-parallel hybrid cars has an ability of power-split, which allows power paths right from IC engine vehicle to the wheels, whereas, this power can be either electric or mechanical. In addition, the plug-in hybrid cars are expected to have fastest growth in the global hybrid cars market due to rising demand of consumers for battery-operated vehicles.
- Based on energy source, the ICE hybrid car segment dominated the global hybrid cars market, in terms of revenue, in 2020. The ICE vehicles has highest adoption rate across the globe, which enhances the market growth. Moreover, IC engine helps the hybrid cars to power the electric motors and act as a generator to recharge the vehicle batteries, therefore, it has highest demand in the market.
Hybrid Cars Market: Regional Analysis
- Based on region, the global hybrid cars market has been segmented into North America, Europe, Asia Pacific, Middle East & Africa, and Latin America
- Asia Pacific region has dominated the global hybrid cars market in terms of revenue for 2020, as this region has highest adoption of ICE and hybrid vehicles and there is rising awareness regarding environment friendly or zero emission vehicle. Moreover, China and India has highest population across the globe, which increases the adoption rate of the ICE, hybrid and electric vehicles, which is expected to witness highest growth for hybrid cars market during forecast period. In addition, governments in Asia Pacific region are providing incentive for adoption of low or zero emission vehicles, which also contributes in the hybrid cars market growth. Further, the North America and Europe hybrid car market has attained maturity due to rising use of electric vehicles, hence it registers moderate growth for hybrid cars market.
Hybrid Cars Market: Competition Landscape
- Key players operating in the global hybrid cars market include
- Volkswagen AG
- Toyota Motor Corp.
- Nissan Motor Co. Ltd.
- Honda Motor Co. Ltd.
- Hyundai Motor Co.
- Continental AG
- BorgWarner Inc.
- Ford Motor Company
- Volvo Group
- Daimler AG
- Allison Transmission
- ZF Friedrichshafen AG
- Others
- Major players that are operating in global hybrid cars market are focusing on expansion of their market share by engaging in collaborations, partnerships, and by mergers & acquisition. For instance, in January 2022, Toyota Motor Corp. has announced to produce hybrid vehicles that will have solid state batteries which will be used for longer journey and it will be charged quicker as compared to other batteries.
Hybrid Cars Market Snapshot
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Attribute |
Detail |
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Market Revenue in 2020 |
US$ 247.29 Bn |
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Market Revenue in 2031 |
US$ 2,183.97 Bn |
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Growth Rate (CAGR) |
21.9% (Year to Year) |
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Forecast Period |
2021-2031 |
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Quantitative Units |
US$ Bn for Revenue and Million Units for Volume |
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Research Scope |
The report covers regional and global hybrid cars market revenue and volume along with key factors influencing the market |
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Report Coverage |
Executive Summary, Market Overview, Global Market, Regional Market, competition landscape |
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Format |
Electronic (PDF) |
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Regions Covered |
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Countries Covered |
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Market Segmentation |
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Companies Profiled |
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Customization Scope |
Available upon Request |
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Pricing |
Available upon Request |
