GCC Electric Vehicles

GCC Electric Vehicles

Electric Vehicle are category of vehicles that utilizes electric batteries to power their transmission as opposed to their conventional counterparts relying on diesel or gasoline for the same. Considering the higher fuel prices and rising concerns towards carbon emissions from conventional fuel vehicles the electric vehicle category has emerged as a viable alternative in the GCC and other regions across the globe.

The Electric Vehicle market is growing at steady rate of 22.06% in the forecast period owing to the increasing demand for low carbon emitting alternatives. The electric vehicles have exhibited and astonishing growth during the recent years due to various factors as impounding demand for low/no carbon vehicles, reduction in the operational cost of the vehicles, introduction of AI and self-driving capabilities, etc.

Moreover, the automotive industry is also witnessing steep challenges with the price fluctuations of crude oil which has resulted in the higher pricing of gasoline and diesel. As most of the buyers in GCC opt for personal cars due to extreme climatic conditions, the higher fuel pricing has impacted the cost of ownership of the vehicles. This has also resulted in the demand for electric vehicles in the GCC region. In line with this many of the automotive manufacturers have launched their new models of electric vehicles in the region providing a larger number of option for the customers.

• In 2020, MG Motors announced the launch of its electric model MGZS EV priced at USD30,000 in the GCC countries. The model offers 335 km range on a single charge with fast charging ability providing 80% of charge in just 40 minutes.
• Additionally, many of the new electric car models have been showcased in various auto expos in the Middle East such as Nissan Ariya, BYD Atto 3, Polestar 2, Volkswagen ID8, Cadillac LYRIQ, Lexus RZ 450e, Lightyear One, BMW iX, BYD Han, Tesla Roadster, and Renault Megane E-Tech Electric.

The significance of electric vehicles in the GCC region has massively enhanced due to some other factors such as government support in terms of reduction of taxes on imports of electric vehicles as well as fostering the ecosystem in the country that would help build a robust manufacturing base in the respective countries.

• Based on Vehicle type, the market is divided into passenger vehicles and commercial vehicles. Among these passenger vehicles have grabbed a significant market share in the two due to various factors such as higher demand for electric vehicles from the individual buyers in order to reduce the operational cost of the vehicles. Additionally, many of the buyers in the GCC region have also shifted from conventional fuel vehicles to electric vehicles in order to reap the taxation benefits provided by the government in the respective countries. In line with the rising demand from the passenger car segment many of the leading car manufacturing companies have started offering fast charging solutions as well as enhanced functionality to the customers such as AI and Adaptive driving solutions that help provide a better driving experience. Commercial usage of vehicles are majorly targeted at taxis providing riding services for intercity and airport travel solutions. In line with the government focus towards improving urbanization as well as developing smart cities and moving towards carbon neutral economy the adoption of electric vehicles is further anticipated to grow in the coming period.
• Based on propulsion type the market is bifurcated into BEV (battery electric vehicles) and Hybrid and Plug-in hybrid electric vehicles. Of these two, the battery electric vehicles have grabbed the major market share in the GCC region. Some of the factors that have been attributed to the growth of the market include battery electric vehicles being more convenient in terms of reduction of the running cost. Additionally, the rapid development of the charging infrastructure of both level 1 and level 2 has significantly reduced the range anxiety among the buyers further leading to the adoption of battery electric vehicles. Hybrid and plug-in hybrid vehicles have played a pivotal role in acting as a steppingstone from the conventional fuel to battery electric vehicles as they operate with the combination of both conventional fuel as well as using an electric battery that charges from the engine/independently and providing additional range in need. These vehicles offer lower operational cost as opposed to their fully conventional fuel counterparts, however, still noticeably lesser than BEV. With the affordable options available in the BEV many of the buyers have shifted towards battery electric vehicles in the region.
• For a better understanding of the market adoption of the electric vehicle industry, the market is analyzed based on its regional presence in countries such as Saudi Arabia, UAE, Kuwait, Qatar, Bahrain, and Oman. The UAE and Saudi Arabia have held major market share in the GCC Electric vehicle market dominated the market and is expected to behave in the same fashion in the forecast period. Over the past few years, the automobile market in the UAE and Saudi Arabia has experienced remarkable growth. This growth can be attributed to several factors including the rising population, increasing demand for transportation, advancements in technology, growing electronics industry, and manufacturing industry. This region is also extensively focusing on building a robust charging infrastructure in order to promote the adoption of commercial as well as private electric vehicles in the coming years. Many of the electric vehicle manufacturers have also announced to open new manufacturing units in the region. For instance, M Glory Holding Group announced to open an electric vehicle manufacturing plant in the UAE in 2022. The plant spanning around 93,000 square meters would be built with the total cost of USD0.5 billion.

Some of the major players operating in the market include Tesla Inc., Volkswagen, BMW, Audi, Hyundai Motor Company, Nissan Motor Co. Ltd., Toyota, General Motor Company, Group Renault, and BYD.