The global fuel cell electric vehicle market generated ~$3 billion revenue in 2020. The market is being driven by the enactment of strict carbon emission regulations, such as those regarding fuel efficiency, by various governments and organizations, and the burgeoning requirement for environment-friendly vehicles, on account of the surging concerns being raised over the escalating carbon dioxide emissions all over the world. For example, the U.S. Environmental Protection Agency (EPA) is encouraging the adoption of fuel cell electric vehicles in order to reduce carbon dioxide emissions in the country.
Furthermore, the European Union has announced recently that it aims to reduce vehicular emissions by 80% by 2050 from the levels reported in 1990. The organization would achieve this objective by promoting the use of green vehicles. Besides, the mushrooming deployment of electric vehicles in several countries is also driving the growth of the fuel cell electric vehicle market. For example, as per the International Energy Agency (IEA), the sales of electric cars surpassed 2.1 million across the world in 2019, thereby propelling the global electric car fleet to 7.2 million.
Moreover, electric cars accounted for 2.6% of the worldwide electric car sales and around 1% of the global vehicle stock in 2019, recording a 40% year-on-year increment from 2018 to 2019. Depending on vehicle type, the fuel cell electric vehicle market is divided into commercial vehicle and passenger vehicle. Between these, the commercial vehicle category is predicted to exhibit faster growth in the market in the coming years. This will be because of the ballooning requirement for emission-free commercial vehicles for logistical and public transportation across the world.
The market is also classified on the basis of range into long and short. Of these, the long category dominated the market in 2020, because of the large-scale adoption of heavy-duty automobiles for logistics and long-haul transportation. To mitigate the overall operational costs, several organizations operating in the logistics industry are adopting sustainable transportation methods and replacing the conventionally used vehicles with fuel-efficient, advanced, and eco-friendly alternatives. Geographically, the fuel cell electric vehicle market is predicted to demonstrate the fastest growth in Asia-Pacific in the forthcoming years.
This will be primarily because of the enactment of strict emission norms by the governments of China and Japan. Further, the existence of several major fuel cell vehicle manufacturing organizations such as Toyota Motor Corporation, SAIC Motor Corporation Limited, and Hyundai Motor Company, is also fueling the deployment of fuel cell electric vehicles in the region. Furthermore, the implementation of initiatives such as the promotion of zero-emission automobiles during major events like the 2020 Summer Olympics in Tokyo, is also propelling the market expansion in the region.
Hence, it is safe to say that the demand for fuel cell electric vehicles will surge sharply in the upcoming years, mainly because of the growing demand for environment-friendly vehicles, on account of the increasing air pollution levels and carbon dioxide emissions, and the enactment of favorable government initiatives regarding their deployment across the world.
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