Dublin, Sept. 02, 2024 (GLOBE NEWSWIRE) -- The "Middle East & Africa Electric Powertrain Market Outlook, 2029" report has been added to ResearchAndMarkets.com's offering.
The Middle East and Africa (MEA) region has reached the threshold of a changing leap to electric powertrains, driven by some of the environmental concerns, technological strides, and calculated strategic economic initiatives. Major drivers of the electric powertrain market in the MEA region embody environmental sustainability objectives and economical diversification strategies. Aggressive investments are being made in other renewable sources of energy and electric mobility by GCC countries like Saudi Arabia and the UAE. This can lead to a decrease in the dependence that results from the exploitation of fossil fuels and lesser carbon emissions as well.
Government policy could thus turn out to be one of the main factors accelerating velocity in the shift toward electric power trains in MEA. Countries such as Morocco, Egypt, and Jordan have rolled out incentive packages that include tax incentives and subsidies aimed at making EV adoption realities within respective markets and attracting local investments in the manufacturing process and infrastructure building. Most of the regulatory support is given toward standards in vehicle emission, energy efficiency, and integration into smart city initiatives that enhance urban mobility with very low environmental impacts. Infrastructure is the major growth bottleneck in the MEA electric powertrain market.
While some of the larger cities, like Dubai and Nairobi, are seeing a rapid rollout of public charging points, in general, infrastructure in rural areas and less developed regions is insufficient to accommodate any kind of wide diffusion of EVs. Huge opportunities with innovative potential exist in further growth for the electric powertrain market in the MEA region. The regional collaboration programs - the Arab Future Cities Program and the African Union's Agenda 2063) - are needed for alignment of policies, sharing of good practice, and promotion of cross-border partnership for sustainable transportation. Other factors that will influence further electrification in MEA with new energy storage and grid integration technologies, in combination with increased driving automation, will push electric mobility to new heights and fundamentally reshape the whole automotive industry landscape in this region.
According to the report, the Middle-East & Africa Electric Powertrain market is anticipated to grow at more than 18.3% CAGR from 2024 to 2029. The transition to electric powertrains in the MEA region brings large environmental and social benefits in terms of reduced air pollution, improved public health outcomes, and enhanced quality of life for urban citizens. Electric mobility solutions materialize relevant SDGs on clean air, climate action, and sustainable cities. Electric buses to city centers and rural electrification projects diffuse electric mobility benefits to underserved communities, that way promoting inclusive economic growth and environmental equity across diverse socio-economic landscapes.
MEA countries increasingly invest in the establishment of local electric vehicle and component manufacturing capacity seeking reduced reliance on imports and creating local employment. For instance, Morocco has become a destination for investments by international automakers in the manufacture of electric vehicles and their batteries, strongly backed by incentive and industrial development strategies. A strong regional supply chain for EV parts, including batteries, motors, and electronic systems, improves industrial resilience and competitiveness in the global electric powertrain market. PPPs are driving infrastructure investments in charging networks and EVSE across MEA.
Market Drivers
- Diversification of Energy Resources: In the Middle East, the diversification of energy resources is a significant driver for the electric powertrain market. Oil-dependent economies are investing in renewable energy and electric mobility to reduce reliance on fossil fuels and combat climate change. For instance, the UAE's Vision 2021 aims to achieve a sustainable environment by promoting the use of electric vehicles, fostering a conducive environment for the growth of the electric powertrain market.
- Government-led Initiatives: Various governments in the MEA region are launching initiatives and pilot projects to promote electric vehicles. These initiatives include incentives for consumers, investments in infrastructure, and regulatory support to drive EV adoption. Saudi Arabia's Vision 2030, for example, includes plans to develop a domestic electric vehicle industry, showcasing the region's commitment to sustainable transportation.
Market Challenges
- Lack of Infrastructure and Consumer Awareness: A major challenge in the MEA region is the lack of adequate infrastructure and consumer awareness. Many countries lack the necessary charging infrastructure and policies to support electric vehicles. The consumer awareness about the benefits and availability of EVs is relatively low. Addressing these challenges requires significant investment in infrastructure development and comprehensive awareness campaigns to educate consumers about electric mobility.
- High Vehicle Costs: The high cost of electric vehicles remains a significant barrier in the MEA region, where price sensitivity is higher. Many consumers cannot afford the premium price of EVs compared to traditional vehicles. Subsidies and incentives are needed to make EVs more affordable for a broader population. Local manufacturing and assembly initiatives could help reduce costs and increase market accessibility.
Market Trends
- Focus on Electric Buses and Public Transport: There is a growing trend towards electrifying public transport systems in the MEA region. Cities are increasingly investing in electric buses and taxis to reduce urban pollution and provide sustainable transportation options. These initiatives are supported by government policies and pilot projects aimed at demonstrating the feasibility and benefits of electric public transport, setting a precedent for broader adoption.
- Local Assembly and Production: Countries in the MEA region are exploring local assembly and production of electric vehicles to reduce costs and create jobs. For example, the establishment of EV manufacturing facilities in countries like Egypt and Morocco aims to build a sustainable supply chain and support economic growth. Local production also helps overcome import barriers and makes EVs more accessible to the regional market.
The strategies for economic diversification, initiative by governments, and considerations to the environment are some of the key factors driving the lead of passenger cars in the electric powertrain market in the MEA region.
Oil-dependent economies, such as UAE and Saudi Arabia, are exploring investment opportunities in renewable energy and electric mobility as part of respective long-term economic diversification plans. For instance, Saudi Arabia's Vision 2030 aims at sustainable transport solution through electric passenger cars to bring down dependency on fossil fuel and ensure economic sustenance. Government incentives and policies are very key to encouraging electric powertrains within the countries of MEA. These vary from tax benefits, subsidies on the purchase of EVs, to exemption from vehicle import duties, hence offering better financial prospects for electric cars among consumers.
High levels of solar irradiance in the region also support the feasibility of solar-powered electric vehicles, cutting operational costs and enhancing sustainability. Considering theInfrastructural gaps and economic disparities, MEA countries embrace electric passenger cars as one of the measures to reduce greenhouse gas emissions that bring improvement in terms of security related to energy flow and promote technological innovation. Notably, investments in charging infrastructure and collaboration with international partners further augment growth in electric mobility solutions across the region.
Battery electric powertrains have a bright future in the Middle East and Africa region, driven by the need to diversify economies and through government initiatives and environmental agendas.
Essentially, countries dependent on oil, such as the UAE and Saudi Arabia, intend to invest in alternative renewable energy and electric mobility as part of respective long-term economic plans. Initiatives like Saudi Arabia's Vision 2030 have brought out minimum dependence on fossil fuel-based transportation and maximum economic sustenance with clean sources, including battery-electric vehicles. Government incentives and policies promote battery electric powertrains in MEA countries. They incentivize through reduction of tax, subsidies on the purchase of EVs, and exemption from vehicle import duties, hence making electric cars more affordable for people.
High levels of solar irradiance in the region also back the feasibility of solar-powered electric vehicles that bring down operation costs to near zero, hence enhancing sustainability. Despite infrastructure gaps and wide-ranging economic disparities, MEA countries are quickly adopting battery electric powertrains to ensure a reduction in GHG emissions, better energy security, and acquiring technologies without much hassle. Investments in recharging infrastructure and cooperation with overseas partners further back the growth of battery electric vehicles across the region.
The MEA Electric Powertrain market was leading in BEV due to leapfrogging traditional infrastructure and opportunity to bypass extensive gasoline distribution networks.
There are significant variations in BEV adoption from one country to another in the landscape of the Middle East and Africa. At least in the Gulf Cooperation Council (GCC) countries, with their immense energy resources, the population interest in BEVs is surfacing, a part of broad economic diversification and smart city initiatives. The United Arab Emirates, especially Dubai, has taken the lead in promoting the adoption of electric vehicles through incentives, including waiving parking fees, exemptions from road toll charges, and charging infrastructure. In Israel, which has a small territory, this orientation toward technological innovation has also placed it at the forefront of the rapid growth in BEV adoption.
The Middle East at large, has the challenge of extremely hot weather that can impair the performance of batteries, as well as abundant, cheap oil resources that lower the economic incentive of the shift to electric. In Africa, major inhibiting factors have so far kept BEVs at very low adoption rates: limited infrastructure and poor affordability. At the same time, there is a growing recognition in Africa of how BEVs could be important in solving issues such as urban air pollution and dependence on fuel imports.
South Africa, Morocco, and Kenya are just among the few nations beginning to embrace electric mobility, with most of the efforts channeled towards two-wheelers and public transportation as entry gases. The African market contains unique opportunities for innovative BEV solutions, which, for example, do not find grid reliability in regions where the leapfrogging potential of conventional automotive technologies is the greatest. Success of the uptake of BEVs in these regions will depend on a tailor-made approach to local climates, not without their infrastructure difficulties and economic realities
Market Segmentation:
By Vehicle Type:
- Passenger Car
- Commercial Vehicle
By Component:
- Battery
- Power Electronic Controller
- Motor/Generator
- Converter
- Transmission
- On-Board Charger
By Application:
- BEV
- HEV/PHEV
Company Profiles
- Robert Bosch
- Magna International
- Mitsubishi Electric
- Cummins
- GKN
- DENSO
- BorgWarner
- Valeo
For more information about this report visit https://www.researchandmarkets.com/r/2dytew
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