Middle-East and Africa Electric Vehicle Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)
The Middle-East and African electric vehicle market was valued at USD 35 million in 2020, and it is expected to reach USD 84 million by 2026, registering a CAGR of over 15% during the forecast period (2021 - 2026).
The impact of the COVID-19 pandemic on the Middle-East and African electric vehicle market is inevitable, as it affected almost every other industry in the market. Manufacturing units have been shut down due to the continuous lockdowns, with social distancing norms to follow and limited staff available to run production lines with all safety measures, owing to the slowdown of the electric vehicle market in the region.
However, the market is expected to witness substantial growth owing to the swiftly escalating Y-o-Y adoption rate of electric vehicles across the region. The growing focus of the governments across the region to promote the use of electric vehicles and increased awareness about energy storage solutions in the renewable-based power sector is expected to drive the market during the forecast period. Moreover, expanding the 5th Generation-based telecommunication network and implementation of Vision Documents in Saudi Arabia, the United Arab Emirates, Qatar, and Kuwait are likely to further aid the Middle East & Africa EV market in the coming years.
Sub-Saharan African (SSA) countries are in urgent need of alternative energy sources for transport to stave off the growing burden of fuel dependency and subsidies, as well as an electricity storage solution to leverage their abundant renewable energy resources. Electric Vehicles (EVs), powered by electricity and running on battery storage, offer a potential solution to both these problems. Many SSA countries are expected to be making large investments in power capacity in the next decade.
In the Middle East region, countries, like Saudi Arabia and the United Arab Emirates, are becoming early adopters of electric vehicles. The Saudi Arabian Standards Organization (SASO) has plans to issue regulations for the use of electric vehicles. In the United Arab Emirates, the Road Transport Authority (RTA) has issued advisory and worked to develop efficient charging stations in the country.
Key Market TrendsRise of Electric Mobility in the Middle-East and Africa RegionThe Middle-East electric vehicle market is expected to register significant growth over the coming years. Although oil constitutes a major source of national revenue and domestic fuel of several Middle Eastern countries, the respective governments are focusing on renewable energy and clean transportation technologies and the implementation of economic and energy diversification plans.
Tesla’s entry into the EV (electric vehicle) market rattled the automobile industry with its all-electric range of vehicles. It gave competing manufacturers a reason to expedite the process of dedicating resources to create fully electric models in the United Arab Emirates, and Dubai has been working toward its long-term goal of electrification. It has launched several initiatives over the past few years to encourage sustainable choices among its residents. For instance,
Although the electric vehicle market in the African region is in the nascent stage, various key players in the market are trying to establish new facilities for product development, thereby, increasing their presence in the market. For instance,
The adoption of electric cars is set to enter the fast lane in the Gulf, especially in tech-savvy urban hubs, like Dubai. As the EVs are in the nascent stage in the country, it has not yet set out incentives for the deployment of EVs, such as free charging stations, Greenbank loans, etc. EV incentives are yet to be developed, especially when EV deployment starts on a commercial scale. However, the country has taken a few initiatives, which are likely to boost the EV demand in the country. For instance,
The United Arab Emirates is another most developed market for EVs regarding sales and charging infrastructure, with Dubai having some 200 charging stations and Abu Dhabi around 2020. The UAE government is targeting to have 42,000 electric cars on the roads in a few years. Moreover, favorable government policies and incentives offer lucrative opportunities to major players to promote the adoption of electric vehicles over the coming years in the region.
Competitive LandscapeThe Middle-East and African electric vehicle market is consolidated by few players, such as Tesla Motors Inc., Volkswagen AG, Toyota Motor Corporation, Nissan Motor Co. Ltd, and Geely, among others. As the demand for electric vehicles is growing in the region, the companies are entering into partnerships, joint ventures, acquisitions with major players in the market. For instance,
Some of the other key players in the market include Ford Motor Company, Foton Motor, Groupe PSA, Kia Motors Corporation, Groupe Renault, Daimler AG, BMW, Hyundai Motor Company, BYD Company Ltd, Continental AG, etc.
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