Middle East EV Powertrain Market: Current Analysis and Forecast (2022-2030)

Electric vehicle powertrain systems include the main components that generate and deliver power to the road surface for fully electric, hybrid electric, and plug-in hybrid electric vehicle applications.

The middle east electric vehicle powertrain market is expected to grow at a strong CAGR of around 26.73% during the forecast period owing to the rising electric vehicle demand and increased investments in this segment. Furthermore, increasing middle eastern governments' emphasis on promoting electric vehicles and making it one of the prominent modes of transportation, for decreasing their carbon footprints and focus on diversifying their economic portfolio mix is boosting the demand for electric vehicles powertrains in the region. Moreover, the enormous growth potential for electric vehicle powertrains is getting developed in the middle eastern region due to the growing traction of electric vehicles among the populace in the region which can also be seen from the growing electric vehicle registrations in the region. For instance, in July 2023, as per the Dubai Electricity and Water Authority (DEWA), EV owners registered under the Green Mobility Strategy 2030 initiative had grown from mere 14 units in 2015 to more than 11,000 units by the end of May 2023, and registrations are expected to get doubled in coming years, whereby 2030 Dubai is expected to have 42,000 units of electric vehicles on the road.

Based on vehicle type, the electric powertrain market is divided into BEV and HEV/PHEV. The BEV segment is expected to witness the highest growth during the forecast period owing to the rapid investments in R&D activities by industry participants to develop advanced powertrain solutions for BEVs. For instance, in October 2021, Tesla announced the use of Lithium Iron Phosphate (LFP) based batteries in all its standard range of electric cars to increase its profit margin. Further, BEVs have become an integral part of the automotive industry and represent a pathway toward achieving energy efficiency, along with reduced emissions of pollutants and other greenhouse gases. Thus, with increased government focus on promoting EV adoption to further drive the growth of the BEVs segment.

Based on components, the electric powertrain market is categorized into motor/generator, battery, power electronics controller, converter, transmission, and onboard charger. The battery segment is expected to hold a majority share throughout the forecast period owing to the ongoing development of Lithium-Ion Batteries coupled with a higher share of batteries in overall powertrain cost. In addition, major stakeholders in the market are engaging in strategic alliances to develop and innovate EV batteries. For instance, in July 2020, China's electric vehicle (EV) battery maker Contemporary Amperex Technology (CATL) announced that Japanese automaker Honda will buy shares in the company to hold a 1% stake and the firms will jointly develop EV batteries. Moreover, enormous amounts of investments are also getting funneled towards the development of battery technologies in the middle eastern region from various sovereign wealth funds and PIF.

For a better understanding of the market adoption of solid-state batteries, the market is analyzed based on its presence in Middle Eastern countries such as (Saudi Arabia, UAE, Israel, Qatar, Turkey, and the Rest of the Middle East). The Middle East is undergoing a remarkable transformation in the fields of energy and technology, with Saudi Arabia and the United Arab Emirates (UAE) emerging as the primary drivers for electric vehicle powertrain demand. These nations have pursued strategic initiatives through significant investments and a focus on creating a complete lithium-ion battery value chain, where the battery is one of the major components of the electric vehicle powertrains. For instance, in June 2023, Australian startup European Lithium and Saudi Arabia's Obeikan Investment Group announced a joint venture to build and operate a lithium hydroxide refinery in Saudi Arabia. The floor price for selling lithium spodumene is set at USD 3,000 per tonne and a ceiling price over the life of the current resource of the Wolfsberg mine. Furthermore, Saudi Arabia and the UAE have ambitious visions to diversify their economies and reduce fossil fuel dependency. Vision 2030 and 2021 focus on technology-driven development and innovation, driving investments in emerging tech such as clean and green energy, and new energy vehicles, where Saudi Arabia and the UAE are investing heavily in battery technology, with PIF investing in tech companies and startups, and the UAE fostering R&D collaborations globally. In conclusion, the outstanding progress made by Saudi Arabia and the UAE within the middle eastern electric vehicle marketplace has been a showcase of their dedication to technological development, economic diversification, and sustainable energy solutions. via strategic investments, the establishment of lithium-ion battery value chains, worldwide collaborations, attention on human capital improvement, and contributions to the worldwide power transition, these nations have placed themselves as leaders in the location's journey toward a battery-powered future. With these efforts continuing to yield effective outcomes, the Middle East is now well-placed to emerge as a chief participant in the global electric vehicle and its ecosystem landscape.

Some of the major players operating in the market include: EV Dynamics (Holdings) Limited; Dana Limited; Robert Bosch GmbH; Lucid; REE; EVR MOTORS; HEIDRON; Pravaig Dynamics Pvt. Ltd.; Siro; and Hyundai Motor Company