LONDON--(BUSINESS WIRE)--Technavio market research analysts forecast the global military hybrid electric vehicle (HEV) and electric vehicle (EV) market to grow at a CAGR of more than 14% during the forecast period, according to their latest report.
The report further segments the market by product type (manned military HEV and EV and unmanned military HEV and EV) and geography (the Americas, APAC, EMEA).
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Technavio analysts highlight the following three market drivers that are contributing to the growth of the global military HEV and EV market:
- Development of cost-effective vehicles
- Need to reduce dependency on conventional sources of energy
- Government policies favoring development of electric-powered vehicles
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Development of cost-effective vehicles
The increasing expense and environmental issues over fuel consumption are promoting the development of cost-effective electric propulsion vehicles. For instance, the US Department of Defense (DoD) is constantly under pressure to cut down on its annual energy bill of around USD 20 billion. It is estimated that more than 50% of the energy bills account for oil consumption that power the country’s fleet of aircraft, ships, and vehicles, and logistics. To reduce its oil consumption, the DoD is focusing on the use of energy-efficient EVs and HEVs on both military bases and battlefields.
According to Moutushi Saha, a lead defense research analyst at Technavio, “One innovation in the market is the Zero MMX, a stealth electric bike designed by Zero Motorcycles. The motorcycle has a finely tuned and fully adjustable suspension system that allows its operators to drive through hostile mission locations with minimal heat signature and minimal noise.”
Need to reduce dependency on conventional sources of energy
The volatile price fluctuations and the depleting natural resources for conventional energy sources, like gasoline, promote the need for alternative sources of energy for the transportation sector. The military is one of the biggest fossil fuel consumers across the globe, and many countries are focusing their attention toward the development and implementation of alternative and renewable energy sources for military equipment and vehicles.
“The US DoD has committed to multiple alternative energy projects that primarily aim to reduce the dependence on gasoline. So, the US military is making investments in alternative fuel vehicles, like EVs and HEVs, as one of the strategies for reducing consumption of conventional energy sources,” says Moutushi.
Government policies favoring development of electric-powered vehicles
Many countries have formulated policies that promote the development and manufacture of EVs. For instance, the US has framed the Energy Independence and Security Act that sets a target standard for the fuel economy of vehicles to be achieved by a model year, which is revised in tandem with technological developments. The act provides loan guarantees for advanced battery research and grant programs for HEVs and EVs to make them economically feasible for mass use. The standards set under the act directly relates to a vehicle’s carbon footprint. A set of formulae is used to calculate the amount of credits to be given to a manufacturer based on factors like environment-friendliness and pollution control of the vehicle developed by the manufacturer, and manufacturers can trade their credits.
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