by A mild hybrid vehicle comprises of a small battery and an integrated starter generator that assists the standard combustion engine. It features start-stop technology and regenerative braking to improve fuel efficiency. These vehicles provide improved fuel economy without the added cost and complexity of a full hybrid system. Major automakers are incorporating mild hybrid technology into their gasoline and diesel models to comply with stringent emission regulations.
The global mild hybrid vehicle market is estimated to be valued at US$ 99.97 Bn in 2023 and is expected to exhibit a CAGR of 18.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
The global mild hybrid vehicle market is driven by growing demands for fuel efficient vehicles to reduce carbon footprint. Stringent emission norms by regulatory bodies are pushing automakers to adopt electrified powertrains. Mild hybrid systems deliver 10-15% better fuel efficiency compared to conventional internal combustion engines. They provide an affordable solution to downsize engines and complement fuel-saving technologies like start-stop and regenerative braking. SUV body styles remain popular among consumers, however their heavier weight impacts fuel economy. Mild hybrid powertrains help luxury SUV models meet Corporate Average Fuel Economy (CAFE) standards set by EPA and governments globally.
Market Dynamics
The mild hybrid vehicle market opportunity of increasing fuel efficiency demands as highlighted in the heading is expected to flourish the market during the forecast period. Stringent government regulations on vehicle emissions is a key driver propelling automakers to adopt hybrid technologies. Regulatory bodies like EPA in US and EU commission have tightened carbon dioxide emission standards which automakers must meet by 2025. Non-compliance would result in heavy fines for manufacturers. Mild hybrid systems complemented with start-stop and regenerative braking provides an affordable yet effective solution to reduce emissions without major architecture changes. They improve fuel efficiency in the range of 10-15% compared to conventional Internal Combustion Engine (ICE) vehicles.This improves the compliance of automakers with emission norms and also appeals to environment-conscious customers. Developing nations are also implementing stricter norms in line with UN guidelines to curb air pollution. This growing regulatory pressure globally is driving significant investments by OEMs in hybridizing their product lineups.
Segment Analysis
The global mild hybrid vehicle market is dominated by the passenger vehicle segment accounting for around 90% share. The passenger vehicle segment is dominating due to growing adoption of mild hybrid vehicle technology by automakers in their passenger vehicle fleet to meet stringent emission norms. This segment is further segmented into compact, mid-size, SUVs and luxury vehicles among which the mid-size vehicles sub-segment currently holds the major share and is expected to continue its dominance during the forecast period owing to high demand for these vehicles particularly in Asia Pacific and European markets.
PEST Analysis
Political: Stringent government regulations regarding vehicular emissions particularly in Europe and China are promoting the adoption of fuel efficient hybrid vehicles. Regional governments offer subsidies to encourage consumers to opt for such green vehicles.
Economic: Growing disposable incomes coupled with lower fuel costs of hybrid vehicles are propelling the demand. However, high initial costs still pose a challenge for volume sales in price sensitive markets.
Social: Increased environmental awareness and consumers preferring automobiles with lower carbon footprint is a key driver. However, limited charging infrastructure deters completive switch to electric vehicles.
Technological: Advancements in battery technologies, engine downsizing, and lightweight materials are helping automakers to develop affordable mild hybrid systems and achieve fuel economy targets without compromising performance.
Key Takeaways
The Global Mild Hybrid Vehicle Market Size is expected to witness high growth over the forecast period, growing at a CAGR of around 18.5%.
Asia Pacific currently dominates the market and is anticipated to continue its dominance during the forecast period. Factors such as the growing middle class population, increasing disposable incomes, and stringent emission norms particularly in major countries like China and India are propelling the sales of hybrid vehicles in the region. For instance, South Korea and India intend to phase out internal combustion engine vehicles in the coming decade.
Key players operating in the mild hybrid vehicle market are Toyota Motor Corporation, Nissan Motor Co. Ltd, Honda Motor Company Ltd, Hyundai Motor Company, Kia Motors Corporation, Suzuki Motor Corporation, Daimler AG, Volvo Group, Volkswagen Group, BMW AG, Ford Motor Company, Audi AG, Jaguar Land Rover Ltd, Chevrolet. Key players are focusing on developing affordable mild hybrid systems and expanding their hybrid vehicle lineups to tap the vast market potential particularly in Asia and Europe.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
