Off-highway electrified components market projected for growth

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The global market for electrified components in off-highway vehicles reached a value of $US10 billion ($13.8 billion) in 2020, and is predicted to grow by 150 per cent to increase to $US25 billion ($34.5 billion) by 2030, according to new insight from global market research firm, Interact Analysis.

From forklift trucks to heavy duty dump trucks, there is great diversity of equipment in the off-highway electric vehicle market.

The forklift market is by far the most mature where electrification is concerned, currently accounting for the great majority of electrified component sales. But, this will change as new electrified technologies suited for other applications such as excavators and tractors come on stream, according to the insight.

In his insight report, Alastair Hayfield, Senior Research Director at Interact Analysis, predicts that by 2030, the Asia-Pacific (APAC) region will become the biggest regional market for electrified power components for off-highway vehicles, raising market share from its current 30 per cent up to 50 per cent.

China will drive much of the growth in Asia, where there will be a significant proliferation of electrified forklift trucks servicing the burgeoning warehousing sector, as well as an anticipated significant increase in electrified solutions for other off-highway vehicles.

According to Mr Hayfield, lack of volume, vehicle size and power requirements and charging infrastructure are some of the challenges facing manufacturers.

“Unlike in the road vehicle sector, off-highway vehicles don’t form a group of uniform applications, and each vehicle type has a relatively low-customer base,” Mr Hayfield says.

“This means that it is much more difficult for off-highway original equipment manufacturers (OEMs) and related component producers to achieve the economies of scale gained by their on-road counterparts, and this is a key factor when considering the issue of electrification of off-road vehicles,” he adds

None the less, Mr Hayfield observes that almost every OEM had produced an electrified off-highway vehicle of some description, and the market for electrified componentry is forecast to grow.

“But the success of the electrified powertrains market in off-highway vehicles will not only be determined by purchase cost and fuel consumption issues. Better performance, controllability and flexibility, and reduced maintenance costs will also be key considerations, not to mention the environmental advantages,” he adds.

The three electrified component segments forecast to offer the biggest revenue opportunities are battery packs, inverters, and motors.

The current price per KWh for a battery for an off-highway vehicle stands at $US350 to $US500 per watt, two or three times the price of a similar type of battery for a road vehicle. But Interact Analysis researchers predict that battery prices are expected to fall, by between 7 per cent and 10 per cent per year.

Reflecting the current trend towards ‘hybridisation’ of off-highway vehicles, where the main powertrain may be traditionally ICE powered, but auxiliary functions are driven by electric power, the work function inverter market is expected to grow more swiftly than the traction inverter market.

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