Soaring demand for fuel-efficient vehicles with minimal drops in performance that comply with norms such as the California Zero Emission Vehicle Program is expected to benefit the global automotive battery thermal management systems market. In a recent report, Fairfield Market Research estimates that the global automotive battery thermal management system market worth $ 666 million in 2020 should register a robust CAGR of 36% until 2026.
The research firm said that potential bans on selling new ICE vehicles accelerate the shift towards electric vehicles (EVs).
The adoption of electric vehicles (EVs) has been vital as the peril of global warming looms large. EV batteries are highly efficient and non-polluting but have range and lifespan limitations. Automotive battery thermal management systems are designed to overcome this by protecting the batteries from external elements and regulating their thermal nature.
Key players in the market include MAHLE, VOSS Automotive, Dana, Continental, LG Chem and Calsonic Kansei.
According to Fairfield Market Research, passenger vehicles are anticipated to dominate the automotive battery thermal management system market for the foreseeable future. There has been a noticeable preference for personal mobility because of the fear of contracting COVID-19. As a result, there is an unprecedented level of choice on offer as consumers can opt for propane, bio-diesel, and hydrogen vehicles, in addition to conventional petrol-powered ones. As governments pass norms to ban the sale of new internal combustion engine (ICE) vehicles, the sale of EVs will likely rise exponentially, opening up immense opportunities for automotive battery thermal management system companies, the report said.
Governments encouraging the adoption of automotive battery thermal management systems by subsidising EVs. In 2013, China's government provided subsidies ranging from RMB 4,000 to 35,000 for each plug-in hybrid electric vehicle and RMB 35,000 to 60,000 for every battery EV purchased, depending on the vehicle range. Although these subsidies decreased by 10% in 2015, they still provided a huge boost to fledgling sales of electric vehicles in the vast China market, and there is a strong possibility of other countries providing similar subsidies to encourage widespread adoption of EVs, benefiting the automotive battery thermal management system market.
Difficulties in designing systems remain a massive challenge in the global automotive battery thermal management systems market.
Manufacturers of automotive battery thermal management system components face numerous power requirements, optimal flow channels, and weight and cost reductions. In addition, any increase in temperature due to high power can be catastrophic and result in short circuits or fires. These inherent complexities in designing automotive battery thermal management systems restrain growth prospects in the market.
Air Pollution Makes APAC To Dominate The Market
As per the report, the Asia Pacific region comprises 60% of the global automotive battery thermal management system market by revenue. China, Japan, India, and South Korea are amongst the ten largest automobile manufacturing nations. Booming economic development in China and India has resulted in rampant air pollution, and national governments have stepped up their efforts in combating it by subsidising purchases. Large corporations such as Mitsubishi and BAIC have invested millions of dollars in electric vehicles, and the APAC region is anticipated to be a trendsetter in electric vehicles.
Courtesy: Fairfield Market Research. NB: Photo is representational; courtesy: Continental.