The automotive industry has seen a major change in recent times. As technology advances, the need for personal mobility increases, and the demand for environmentally friendly options increase, the automotive industry has shifted its focus towards better alternatives. This search for alternatives has led to increased demand for alternative fuels and electric vehicles.
The electric vehicles market has seen immense growth over the past decade. Moving from prototypes to popular luxury electric cars and electric busses, the market is on the ideal path to proliferation. There is a range of options within the electric vehicles (EVs) market, including hybrid EVs, plug-in hybrid EVs, and battery EVs. This range enables consumers to choose the best option for themselves while shifting from vehicles that use traditional petroleum fuels.
Some of the most significant contributors to the increasing demand for electric vehicles have been the need to reduce personal carbon footprints and the high prices of petroleum. As economies struggle due to various factors, and fossil fuels run short, millennial and Gen Z consumers are willing to invest more in safer, environmentally responsible alternatives.
While the COVID-19 pandemic took a huge toll on the automotive industry, experts forecast further growth for the electric vehicles market as most countries work towards recovering their economies and industries. However, as electric vehicles market players aim towards recovery, it is important to identify and understand the trends influencing demand and the market. Therefore, Infiniti’s industry experts discuss the impact of COVID-19, major trends, and challenges in the electric vehicles market in this article. Additionally, they discuss the role of market trends analysis in an evolving and easily influenced market, such as the electric vehicles market.
As the world recovers from the COVID-19 pandemic, find out how the electric vehicles market can effectively prepare for the post-COVID era by requesting a free proposal.
The Impact of COVID-19 on the Electric Vehicles Market
The automotive industry and electric vehicles market witnessed a substantial decrease in demand since the advent of the COVID-19 outbreak. The pandemic has negatively impacted the global economy and significantly damaged GDPs in many developed and developing countries. This has led to job losses, further economic disparity, and reduced income for working professionals in every stratum of the corporate hierarchy. With lower disposable income, consumers are focused on near-time expenses, and major investments such as personal automobiles have been termed an unnecessary expense.
Additionally, due to nationwide lockdowns and imposed safety measures, many manufacturers were required to pause all production for an indefinite amount of time. The economic toll and supply chain challenges posed by this sudden disruption has caused significant losses for companies. Although electric vehicles require lower consumption costs daily, the initial investment is higher than that for most traditional fuel-run vehicles. Fuel prices have seen a momentary reduction in many markets, affecting the demand for electric cars shortly. However, all industries are on the path to recovery. Electric vehicle market players must prepare for the trends and challenges that await them on the other side of the pandemic.
Major Trends in the Electric Vehicles Market
As the electric vehicles market continues to grow, various trends will impact this growth and propel or challenge it. Infiniti’s industry experts identified the following three major trends that continue to impact the electric vehicles market:
Rising Environmental Concerns
Increasing awareness about the impact of various industries on the current environmental situation has changed consumers’ buying behaviors substantially in recent years. The automotive industry and automobiles particularly are notoriously known to produce an extremely high amount of carbon emissions. This has led to consumers being more cautious and selective about their transport and automobile investments. With a range of electric vehicles, from bicycles to large vehicles like busses, consumers are now more likely to choose EVs over vehicles that require fuel. However, this has also led to an increase in more stringent government policies and regulations. With particular stipulations for the emission levels permitted in different vehicles, electric vehicle market players must be particularly careful in their development and production processes. This requires major investment, increased scrutiny, and compliance with various regulations.
Investment and Government Support
Due to the rising concerns regarding carbon emissions and environmental safety, governments and automakers have increased investments in the electric vehicles market. Governments worldwide are taking initiatives to increase deployment of EVs on the roads. Additionally, through the shock of the COVID-19 pandemic on economies, many governments launched schemes and offers to encourage investment in automobiles. As the industry starts to recover, governments are attempting to promote EVs and reduce dependence on fossil fuels.
Consumers’ Preferences
In a challenging and competitive market like the automotive industry, understanding consumers’ preferences are crucial to success. As consumers shift their focus from fuel-dependent vehicles to EVs, the demand for variety and options is expected to rise substantially. While many automakers have started offering EVs ranging from hatchbacks to luxurious sedans, there will be a growing demand for more options as this shift takes place.
Additionally, since vehicles are widely-used for personal mobility of varying kinds – short trips to work, weekend trips, or long road-trips – consumers will demand a higher battery range. The presence of gas stations along highways and within cities enables consumers to travel long distances conveniently. This requires companies to ensure that their vehicles have lasting power and can be conveniently recharged, even on long trips. Many car rentals companies have shifted to EVs, and are often preferred by Millennial and Gen Z consumers. However, to attract a wider audience, including older consumers, or consumers with hectic schedules, the electric vehicles market will need to adapt and grow.
In a fast-paced and growing market, staying ahead of the trends is the first step to long-term success. Speak to our industry experts to learn how Infiniti’s market trends analysis can help your organization prepare for the future of the electric vehicles market.
Challenges in the Electric Vehicles Market
While the electric vehicles market is expected to witness growth in the post-COVID era, automakers must be aware of and strategize for the various challenges within the industry. Due to the low demand for EVs currently, R&D costs require automakers to attribute higher prices for EVs. While these costs will reduce as demand increases, demand for EVs will not be par with the demand for fuel-dependent vehicles shortly due to the price difference.
Additionally, the lack of available charging stations along highways or within cities can affect the demand for EVs. Electric vehicle market players must set up a higher number of charging stations for consumers with EVs. These challenges can be tackled if the market continues to grow. However, these challenges may simultaneously be a detriment to growth. Therefore, electric vehicle market players need to strategize for these challenges and help the market grow.
The Importance of Market Trends Analysis in the Electric Vehicles Market
The various trends in any industry can propel or disrupt growth in the market. In the automotive industry, various trends can have a major impact on the development, investment, and production processes for automakers. The different market trends similarly impact the electric vehicles market. Therefore, market players must identify, evaluate, and understand the various trends in the market.
Infiniti’s market trends analysis is among the best ways for automotive industry players to understand their market, prepare for the various market trends, and succeed. Here’s how Infiniti’s market trends analysis can help:
- This analysis helps companies study the market and identify major market trends that may impact their operations soon.
- It also enables companies to strategize for these dynamic market trends appropriately and avoid sudden shocks within their supply chain and production processes.
- With market trends analysis, companies can forecast possible growth drivers within trends and stay a step ahead of their competitors with pre-emptive production according to consumers’ needs and market dynamics.
In the electric vehicles market, market trends analysis enables companies to understand how the varying environmental changes affect them, understand and comply with the various government regulations, and forecast consumers’ demands. This helps players stay ahead of their competitors, increase consumer satisfaction, create effective market expansion plans, and realize huge savings within their organization.
Understanding a complex market requires expertise and appropriate guidance. Request more information to learn how Infiniti’s experts can guide companies in the electric vehicles market.
