NEV refers to the new energy vehicles that are either fully or partially powered by electric power such as Battery Electric Vehicles (BEVs) or Plug-in Hybrids (PHEVs). These taxis further have low running and maintenance costs and cause less or no harm to the environment. These are some of the key factors that are augmenting the adoption of new energy vehicles as taxis in various countries.
Global Nev Taxi Market, Forecasts From 2019 to 2025, in US$ Billion
Source: Knowledge Sourcing Estimates
The graph mentioned above represents the market size of the global NEV taxi market which shows that the market is poised to witness a strong growth throughout the forecast period by reaching US$55.558 billion by the year 2025 from US$11.674 billion. The major factors that are anticipated to augment the market growth for NEV taxi include the several initiatives taken by the government of both developed and developing economies regarding the protection of the environment. The booming adoption of electric vehicles as a sustainable mode of commuting is also a key factor that plays a significant role in shaping up the growth of the global NEV taxi market throughout the course of the next five years. Furthermore, the rapid penetration of new market players in the electric vehicle industry with an aim to expand their market share and gain a competitive edge over other players also shows the potential for the market to grow in the near future.
The market is also expected to grow on account of several government initiatives in the developing economies to promote the use of NEVs as taxis as public transport is considered to be a major contributor to carbon emissions. For instance, the Indian Government announced its plans in 2019 in which it is expected that the government may mandate the deployment of around 40% of electric feet by the various taxi providing companies throughout the country. Also, increased funding in the country received by taxi providers for the promotion of the electric fleet also shows the potential for the market to grow in the near future. For instance, in March 2019, Ola announced its spin-off Electric Business as a separate business unit and received funding worth US$56 million from Tiger Global and Matrix India.
The global NEV taxi market has been segmented on the basis of vehicle type and geography. By the vehicle type, the market has been segmented on the basis of Battery Electric Vehicle (BEV), Plug-in Hybrid Electric Vehicle (PHEV), and Fuel Cell Vehicle (FCV). Geographically, the segmentation of the market has been done on the basis of North America, South America, Middle East, and Africa, Europe, and Asia Pacific.
The battery-electric vehicle (BEV) segment is anticipated to hold a decent market share throughout the forecast period on account of the presence of a vast number of vehicles under this segment. The plug-in hybrid segment is projected to show a notable growth during the next five years as the entry of new market players under the plug-in hybrid segment is a major factor supplementing the growth of plug-in hybrid electric taxis over the course of next five years. Also, Plug-in hybrid electric vehicles are those electric vehicles that use batteries for powering up the electric motor and also use an alternative fuel such as gasoline or diesel for power the other propulsion source such as an internal combustion engine. These vehicles can run on electricity and on fuel also offers a higher fuel economy in comparison with conventional vehicles.
Geographically, the North American region is anticipated to hold a substantial share in the market on account of early technology adoption of the presence of a well-established electric vehicle charging infrastructure in the countries like the United States and Canada. The European region is expected to hold a good amount of share in the market on account of the presence of a considerable large number of automotive manufactures across several countries of the region. Furthermore, the market in the APAC region is expected to witness a healthy growth on account of the presence of the fastest-growing economies such as India and China among others, and transport is considered as the backbone of these economies. The constantly growing pollution coupled with the increasing government budgets towards the setting up of necessary infrastructure for the easy deployment of electric feet further bolster the market growth in the APAC region. For instance, in November 2018 EV Motors India in partnership with DLF, ABB India, and Delta Electronics plans to set up 6500 electric vehicles (EC) charging stations across the country over the next five years.
The Recent Outbreak of COVID-19
The market is projected to witness a slight downfall especially in the short period of the next six to eight months due to the intense outbreak of the novel coronavirus disease. The outbreak of the disease has led to a ban on travel across may countries. There is a temporary halt in the activities across the tourism sector that has led to a decline in the demand for taxi services. Also, various government measures to reduce the spread of the disease such as social distancing, and lockdowns has also led to a decline in the traveling activities also. Moreover, the temporary halt in manufacturing activities is also anticipated to moderately inhibit market growth during the short run.
Government Initiatives Regarding the Promotion of EVS
Increasing the need to use vehicles that utilize greener technologies is driving the growth of electric vehicles throughout the globe. The governments of various countries in both developing and developed economies of the world are implementing numerous strategies and taking numerous initiatives for the promotion of electric vehicles is expected to significantly drive the NEV taxi market growth during the next five years. Also, the increase in the deployment of electric vehicles has also grown exponentially in the past years, this also shows the growth potential for the global electric sports market to grow during the course of the next five years.
Electric Car Deployment – World, 2013 to 2018, in Million Units