Vehicle Electrification Market:
According to MRFR analysis, the vehicle electrification market was valued at USD 79.35 billion in 2023. It is expected to grow steadily, reaching USD 84.95 billion in 2024 and climbing to approximately USD 180 billion by 2035. This represents a compound annual growth rate (CAGR) of about 7.06% during the forecast period from 2025 to 2035.
Vehicle electrification refers to the use of electric power to drive a vehicle's components, including propulsion, heating, and cooling systems. The shift from internal combustion engines to electric power sources is transforming the automotive industry, driven by environmental concerns, fuel efficiency, and government regulations.
Electric vehicles (EVs) are a major component of vehicle electrification, as they produce lower emissions and have lower operational costs.
The market for vehicle electrification is experiencing rapid growth due to advancements in battery technology, increased charging infrastructure, and consumer demand for eco-friendly transportation options. As governments worldwide push for cleaner transportation alternatives, the Vehicle Electrification Market is set to expand further.
Market Research Future Insights
The primary reason behind the huge shift in the automotive industry is the electrification of vehicles. Increased automotive manufacturing and global vehicle sales are the main factors driving the need for the electrification of automobiles. The electrification of vehicles is gaining popularity as a replacement for conventional hydraulic and mechanical systems. The electrification of vehicles increases their fuel economy and lowers their emissions. COVID-19 had a significant influence on the car industry.
In the year 2020, there was a 15% global decline in the number of cars sold. Along with it, the demand for automobiles drastically decreased, causing production lines to temporarily shut down. The supply chain was also impacted by the restrictions on transit during the lockdowns. However, the vehicle industry is currently growing quickly and impressively.
Vehicle Electrification Market Companies
Robert Bosch GmbH (Germany)
Continental AG (Germany)
ZF Friedrichshafen AG (Germany)
Denso Corporation (Japan)
JTEKT Corporation (Japan)
Nexteer Automotive (U.S.)
Mitsubishi Electric Corporation (Japan).
Mando Corp. (South Korea)
Borgwarner Inc. (U.S.)
Delphi Automotive PLC (U.K.)
Johnson Electric (Hong Kong)
Regional Analysis
The Asia-Pacific region would account for the biggest market share. The demand for EVs is growing as a result of the significant presence of numerous important companies and government regulations encouraging the usage of electric cars. Economic and technical developments will also help the expansion process.
The Vehicle Electrification Market Revenue will be led by North America in second place. The market is receiving a significant boost from the availability of improved infrastructure and the strong demand for electric automobiles.
The market for vehicle electrification will also continue to grow significantly in Europe in the coming years. The market will benefit from the demand for efficient transportation and eco-friendly automobiles.
Market Segmentation
The Global Vehicle Electrification market has been segmented into Voltage, Product Type, and Degree of hybridization.
Based on the Voltage, the market has been segmented into 14 V, 12 V, 48 V, and 24 V.
Based on the Product Type, the market has been segmented into Electric Power Steering (EPS), Integrated Starter Generator (ISG), Stop/Start System, Liquid Heater PTC, Electric Oil Pump, Electric Vacuum Pump, and Starter Motor.
Based on the Degree of hybridization, the market has been segmented into Internal Combustion Engine (ICE) & Micro-Hybrid Vehicles, Battery Electric Vehicle ((BEV), Plug-In Hybrid Electric Vehicle (PHEV), 48 Mild-Hybrid Market.
Key Players
Some of the key market players are Robert Bosch GmbH, Continental AG, ZF Friedrichshafen, Denso Corporation, JTEKT Corporation, Nexteer Automotive, Mitsubishi Electric Corporation, Mando Corp, Borgwarner Inc, Delphi Automotive PLC, Johnson Electric.
2025 Vehicle Electrification Industry Updates: Tesla and CATL
Tesla
Industry Development and Latest Update (2025)
April 2025: Tesla unveiled its next-generation energy storage system, the Megapack 3, with 50% higher energy density than previous models. The new system is expected to accelerate grid-scale renewable energy adoption by providing more efficient and cost-effective energy storage solutions. During the announcement event, Tesla CEO emphasized that this technology would help utilities manage peak demand while integrating more solar and wind power into their generation mix.
CATL (Contemporary Amperex Technology Co. Limited)
Industry Development and Latest Update (2025)
March 2025: CATL announced a breakthrough in sodium-ion battery technology, achieving energy density of 200 Wh/kg, making it a viable alternative to lithium-ion batteries for electric vehicles in certain applications. The company stated that commercial production would begin in Q3 2025, with major automotive partners already signed for initial supply agreements. This development represents a significant step toward reducing dependency on lithium and other critical minerals facing supply constraints.
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