Electric Car Market to Grow at a CAGR of 9.8% from 2025 to 2032 | SkyQuest Technology Consulting

The electric car market is anticipated to expand at a rapid pace due to growing global awareness of climate change, and the urgent need to reduce carbon emissions.

WESTFORD, Mass., Aug. 8, 2025 /PRNewswire/ -- SkyQuest Technology Consulting published a report, titled, 'Electric Car Market - Global Opportunity Analysis and Industry Forecast, 2025-2032', valued at USD 738.5 Billion in 2024. With a projected CAGR of 9.8% from 2025 to 2032, the market is expected to reach USD 1558.72 Billion by the end of 2032. Growing awareness of climate change and the detrimental effects of air pollution from internal combustion engine (ICE) vehicles is a primary driver. Governments worldwide are implementing stricter emission regulations to combat this, pushing manufacturers and consumers towards cleaner alternatives like EVs.

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Electric Car Market Dynamics:

The electric car market is poised for rapid expansion, particularly in India, driven by a powerful confluence of factors. Governments, including the Indian government, are actively pushing for this shift through supportive policies and significant incentives.

For instance, India's recent EV policy drastically reduces import duties for global automakers committing to local manufacturing, aiming to attract major players like Tesla and fostering a robust domestic EV ecosystem. Schemes like FAME II (which concluded and has been succeeded by others like PM E-DRIVE) and PLI schemes continue to incentivize both the purchase of EVs and their localized production, including critical components like batteries.

Recent Developments in Electric Car Market

• In January 2024, JSW Group and SAIC Motor form JSW MG Motor India. This pivotal joint venture saw the Indian conglomerate JSW Group acquire a substantial stake in MG Motor India. The collaboration's goal is to significantly localize production, broaden MG's electric vehicle portfolio in India, and rapidly scale up manufacturing capabilities to meet the country's booming EV demand.
• In April 2024, Hyundai Motor and Kia Forge Strategic Partnership with Exide Energy for EV Battery Localization in India. In a crucial move for the Indian market, Hyundai Motor Company and Kia Corporation signed a Memorandum of Understanding (MOU) with Exide Energy Solutions Ltd., a leading Indian battery company. This partnership focuses on localizing EV battery production, specifically for lithium-iron-phosphate (LFP) cells, aiming to equip future Hyundai and Kia EV models in India with domestically produced batteries to enhance cost competitiveness.
• In June 2024, Hubject and Exicom Announce Strategic Partnership in India EV Market. Hubject, a global leader in EV interoperability, entered a strategic partnership with Exicom, India's largest EV charger manufacturer. This collaboration aims to significantly improve the EV charging experience for drivers in India by leveraging Hubject's interoperability technology, including its intercharge platform and Plug&Charge capabilities, to make charging more seamless and reliable.

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Major Challenges in Electric Car Industry

One of the primary hurdles for mass EV adoption is the higher initial purchase price compared to traditional internal combustion engine (ICE) vehicles. This is largely due to the expensive battery pack, which constitutes a significant portion of the EV's overall cost. Despite government subsidies and a shrinking price gap, for many Indian consumers, the upfront investment remains a considerable barrier. This higher cost also impacts related expenses, such as EV insurance, which can be more expensive.

Competitive Landscape:

The competitive landscape of the market is dynamic and rapidly evolving, marked by the strong presence of established automakers, the emergence of innovative startups, and the entry of global players. While various segments exist, the passenger EV and two/three-wheeler segments are particularly competitive. For instance, in June 2025, Kadam Mobility and TVS Motor Company joined forces to deploy 500 TVS King EV MAX electric three-wheelers across India by FY2026.

The major players in the electric car industry include,

• Tata Motors
• JSW MG Motor India
• Mahindra & Mahindra (M&M)
• Ola Electric
• TVS Motor Company
• Bajaj Auto
• Ather Energy
• Hyundai Motor India
• BYD India
• Piaggio Vehicles
• Hero Electric/Hero MotoCorp (Vida)
• Kinetic Green

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Electric Car Market Segmentation: 

The global electric car market is segmented into power output, component, charging point type, driving range, car type, price range, end user and region. Based on propulsion type, the market is segmented into battery electric vehicle (BEV), plug-in hybrid electric vehicle (PHEV) and fuel cell electric vehicle (FCEV). Based on car type, the market is segmented into Hatchback, SUV, sedan, sports car and others. Based on driving range, the market is segmented into short-range electric cars, mid-range electric cars and long-range electric cars. Based on charging point type, the market is segmented into AC and DC. Based on component, hardware, software and services. Based on power output, the market is segmented into less than 100 kw, 100 kw to 250 kw, and more than 250 kw. Based on price range, the market is segmented into low-priced, mid-priced and luxury. Based on end user, the market is segmented into private users and commercial users. 

• By propulsion type, battery electric vehicle (BEV) dominate due to increasing environmental regulations, longer driving ranges, and expanding charging infrastructure.
• By car type, SUV lead the segment owing to consumer preference for larger vehicles with more space, safety features, and versatility.
• By driving range, mid-range electric cars are most popular as they offer a practical balance between affordability and sufficient range for daily use.
• By charging point type, DC segment dominates due to its unparalleled ability to offer rapid replenishment of an electric vehicle's battery.
• By component, software leads due to its pivotal role in controlling battery management systems, telematics, and driver-assistance features.
• By power output, 100 kW to 250 kW dominates due to its ability to strike an optimal balance between vehicle performance, efficiency, and affordability.
• By price range, mid-priced dominates due to its ability to balance cost-effectiveness with performance and functionality.
• By end user, private users dominate due to the increasing personal environmental consciousness of individuals and the significant long-term economic benefits derived from lower fuel and maintenance costs compared to traditional vehicles.

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Regional Insights

The Asia Pacific region, particularly China, holds the largest share of the global electric car market. This dominance stems from substantial government support, a robust domestic manufacturing ecosystem, and high consumer demand driven by diverse and often more affordable EV options.

North America, primarily the United States, is experiencing accelerating growth. This surge is propelled by supportive government policies like the Inflation Reduction Act, which offers substantial tax credits and incentivizes domestic EV and battery manufacturing.

Europe is a strong performer in the market, with its significant EV adoption driven by ambitious CO2 emission targets set by the European Union, which compel automakers to increase their EV offerings, alongside various national-level incentives.

LAMEA region is an emerging growth hub. Its expansion is increasingly fuelled by proactive government policies, the influx of more affordable EV imports, and a rising awareness of sustainable transportation solutions across developing economies.

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About SkyQuest Technology Consulting

SkyQuest Technology Consulting is a leading Strategy Consulting and Market Research firm, provides syndicated as well as customized research reports and growth consulting services, trusted by CXOs from Fortune 500 Companies, Start-ups, and MSMEs. The company comprises a team of expert research analysts and consultants, adding more than 1200 market research reports in our database each year. These reports offer in-depth analysis on 40+ industries & sub industries across 25 major countries worldwide, serving global clients across diverse industries. The company specializes in delivering customized intelligence, data-driven insights, and strategic advisory services that enable businesses to stay competitive and make informed decisions in rapidly evolving industries.

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