Electric Van Market

Growing demand for high-performance and emission-free electric vans to propel the market growth

Due to growing gas and diesel oil prices in recent years, there has been a surge in demand for emission-free electric vans.

Additionally, the transport industry is responsible for around a quarter of all greenhouse gas (GHG) emissions, according to the United Nations Environment Program (UNEP). As a result, many governments throughout the world have started initiatives to deploy electric van to improve the sustainability of their urban transportation system. In the following years, it's anticipated that the introduction of electric van would transform mass transit systems all over the world. As a result, the market is expected to rise at a faster rate during the forecast period due to rising demand for emission-free, high-performance electric vans.

Thus, this factor is driving the market CAGR.

Furthermore, over the past ten years, the price of electric vehicle batteries has decreased as a result of technological improvements and widespread battery manufacture. Due to the fact that batteries account for nearly 30% to 40% of the overall cost of electric vans, this has caused the price of electric van to decrease. For example, the cost of an electric vehicle battery in 2010 was approximately $1,100 per kWh. A research claims that by 2020, the cost of an electric vehicle battery will have dropped to about $137 per kWh, while in China, the cost is only $100 per kWh.

This is attributable to improvements in battery technology as well as lower battery manufacturing costs, cheaper cathode material prices, and higher production volumes. By 2030, the cost of electric vehicle batteries is anticipated to drop to about $40–60 per kWh, which will significantly lower its price and bring their cost closer to that of standard gasoline-powered vans. In the not-too-distant future, this will result in widespread use of electric vehicles due to the rising need for low-pollution transportation.

Additionally, globally, governments are putting pressure on automakers to invest in the development of electric van and reduce CO2 emissions from the use of diesel fuel. The creation of electric battery vehicles has been encouraged by the government through various programmes and plans, which is anticipated to fuel market expansion. Thus, governments worldwide offer tax breaks and other incentives to encourage the purchase of electric vehicles. Some national governments have made electric vehicles free from paying tolls on the highways.

For instance, the Indian government intends to lower the Goods and Services Tax (GST) on electric vehicles from 12% to 5% in order to hasten the adoption of electric vehicles.

The governments are contemplating a complete transition from conventional vans to electric van due to strict emission rules. For instance, the UK government declared in November 2020 that all brand-new gasoline and diesel cars and vans will be phased out by 2030 and that the entire fleet of government cars and vans would be 100% zero emission vehicles by 2027. Thusff, it is anticipated that this aspect will accelerate electric van market revenue globally.

The Global Electric Van Market Industry is poised for substantial growth, with projections indicating a market value of 10.9 USD Billion in 2024 and an anticipated increase to 79.9 USD Billion by 2035. This remarkable growth trajectory, characterized by a compound annual growth rate of 19.87% from 2025 to 2035, underscores the increasing adoption of electric vans across various sectors. The market dynamics are influenced by factors such as technological advancements, government support, and shifting consumer preferences, all contributing to a robust expansion of the electric van segment.

Evolving consumer preferences are significantly influencing the Global Electric Van Market Industry. As awareness of environmental issues grows, consumers are increasingly favoring brands that demonstrate a commitment to sustainability. This shift is prompting manufacturers to enhance their electric van offerings, focusing on features that appeal to eco-conscious buyers. The demand for electric vans is likely to increase as consumers seek vehicles that align with their values. This trend not only supports the growth of the electric van market but also encourages manufacturers to innovate and improve their product lines to meet changing consumer expectations.

Government initiatives play a pivotal role in the Global Electric Van Market Industry, as various countries implement policies to promote electric vehicle adoption. Incentives such as tax rebates, grants, and subsidies are designed to encourage businesses to transition to electric vans. For example, several European nations offer substantial financial incentives for electric vehicle purchases, which significantly lowers the total cost of ownership. This supportive regulatory environment is anticipated to drive market growth, with projections indicating a market expansion to 79.9 USD Billion by 2035, highlighting the effectiveness of government interventions in fostering electric vehicle adoption.

The rising costs of traditional fuels are driving businesses to consider electric vans as a more economically viable alternative. The Global Electric Van Market Industry is benefiting from this trend, as electric vans typically have lower operating costs compared to their gasoline or diesel counterparts. With fuel prices fluctuating, companies are increasingly recognizing the long-term savings associated with electric vehicles. This economic rationale is expected to contribute to a compound annual growth rate of 19.87% from 2025 to 2035, as more businesses seek to optimize their logistics and reduce fuel expenditures through the adoption of electric vans.

The Global Electric Van Market Industry is experiencing a surge in demand for sustainable transportation solutions. As environmental concerns escalate, businesses and consumers alike are increasingly prioritizing eco-friendly options. This shift is reflected in the projected market value, which is expected to reach 10.9 USD Billion in 2024. Companies are investing in electric vans to reduce their carbon footprints and comply with stringent emissions regulations. For instance, major logistics firms are integrating electric vans into their fleets to enhance their sustainability profiles, indicating a broader trend towards greener transportation solutions.

Technological advancements in battery technology are revolutionizing the Global Electric Van Market Industry. Innovations such as improved energy density and faster charging capabilities are enhancing the performance and appeal of electric vans. Manufacturers are increasingly adopting lithium-ion batteries, which offer longer ranges and shorter charging times. These advancements not only improve the practicality of electric vans for commercial use but also contribute to lower operational costs. As battery technology continues to evolve, it is likely to attract more businesses to invest in electric vans, further propelling market growth in the coming years.

By region, the study provides the market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The Asia Pacific electric van market accounted for USD 2.8 billion in 2021 and is expected to exhibit a 42.30% CAGR during the study period. Governments in the Asia Pacific area have adopted a variety of actions to entice major OEMs to enter their domestic markets as a result of their recognition of the automobile sector's growth potential.

A number of European and American automakers, including Volkswagen (Germany), Mercedes-Benz (Germany), and General Motors (US), have relocated their manufacturing facilities to developing nations. Thus, the market will expand.

Further, the major countries studied in the market report are: The U.S., Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 3: ELECTRIC VAN MARKET SHARE BY REGION 2021 (%)

Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

Europe electric van market is expected to grow at a significant CAGR from 2022 to 2030 because they have been widely adopted in nations including Norway, Sweden, the Netherlands, Germany, France, and the UK. During the projected period, market expansion in this region is anticipated to be fueled by increasing demand for high-performance and low-emission automobiles as well as supportive government policies and regulations regulating vehicle emissions. Moreover, Germany electric van market held the largest market share, and the UK electric van market was the fastest-growing market in this region.

North America electric van market accounts for the second-fastest growing market share because of the U.S.'s growing demand for electric vans. Additionally, a non-profit organisation called Electrify America, which promotes the use of electric vehicles, declared plans to invest $200,000 in California in 2018. As a result, it is anticipated that over the projection period, demand for electric vans in North America will increase. Further, the US electric van market held the largest market share, and the Canada electric van market was the fastest-growing market in the region

Major market players are spending a lot on R&D to increase their product lines, which will help the electric van industry grow even more. Market participants are also taking various strategic initiatives to grow their worldwide footprint, including new product launches, contractual agreements, mergers and acquisitions, increased investments, market developments and collaboration with other organizations. Competitors in the industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market industry.

One of the primary business strategies manufacturers adopt in the electric van industry to benefit clients and expand the sector is manufacturing locally to reduce operating costs. In recent years, electric van industry has provided medicine with some of the most significant benefits. The electric van market major player such as Tesla Inc, Mercedes-Benz Group AG, BYD Company Ltd, General Motors, Toyota Motor Corporation, Hyundai Motor Company, Honda Motor Company Ltd., Nissan Motor Co. ltd, Volkswagen AG and Stellantis N.V.

The vehicle division of the publicly traded Chinese multinational manufacturer BYD Company, with its headquarters in Xi'an, Shaanxi Province, China, is known as BYD Auto Co., Ltd. In October 2021, with a load capacity of 780 kg and a driving range of 275 km, BYD introduced the ETP3 Panel Van. It also has a 44.9 kWh battery, an electric motor rated at 35 kW, and a top speed of 100 km/h.

Toyota Motor Corporation is a Japanese automaker with its main offices in Toyota City, Aichi, Japan. Kiichiro Toyoda established it, and it became a corporation on August 28, 1937. One of the biggest automakers in the world, Toyota produces around 10 million automobiles annually. In April 2021, the Proace Electric van, which has a battery capacity of 75 kWh and a range of 175 km, was introduced by Toyota Motor Corporation.