Solar Vehicle Market Size, Share & COVID-19 Impact Analysis, By Vehicle Type (Passenger Car, Commercial Vehicles), By Battery Type (Lithium-Ion, Lead-Acid, Others), By Solar Panel Type (Monocrystalline, Polycrystalline) and Regional Forecast, 2020-2027

The global solar vehicle market size was USD 228.1 million in 2019 and is projected to reach USD 689.5 million by 2027, exhibiting a CAGR of 18.1% during the forecast period.

Solar vehicles are electric vehicles that use integrated solar panels to generate electric energy. Solar energy is converted by photovoltaic cells embedded in the solar panel, and the resultant electric energy is then stored in the vehicle battery. Factors such as decreasing battery costs, advanced manufacturing processes for solar panel integration, and the increasing adoption of environment-friendly vehicles are propelling the demand for these vehicles. These factors are expected to lead to the growth of the market during the forecast period.

Lack of Funding amid COVID-19 Propels Exit of Smaller Market Players

A reduced supply of parts from key automotive manufacturing regions such as China, Japan, and South Korea, along with assembly plant closures in Europe and North America, and a downturn in demand across the globe, has been the primary impact of the pandemic on the automotive industry. Regulatory authorities in several countries such as China are exploring relaxation of emission mandates as auto manufacturers are compelled to reduce funding for key issues such as range advancement and cost reduction of solar vehicles.

Several startups such as Sono Motors and Lightyear are operating in the market. However, the pandemic has significantly impacted the long-term sustainability of such companies.

For instance, Sono Motors delayed the production of its solar electric car Sion from the end of 2020 to 2021 even before the pandemic. The company further crowdsourced funding in January 2020 to continue operations. However, further lack of innovation funding from potential investors and increased competition in terms of new EVs in larger volumes in the next two years may lead to the consolidation of such smaller market players. Hence, the exit of smaller market players unable to compete financially with established manufacturers such as Toyota, Nissan, and others is anticipated to be the key impact of the pandemic on the market.

LATEST TRENDS

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Technological Advancement of Solar Vehicle Rooftops to Augment Growth

Several manufacturers such as Toyota, Mahindra & Mahindra Ltd, and Hyundai, among others are working on introducing commercially available vehicles that can be retrofitted with solar roof charging systems. For instance, the new Sonata Hybrid equipped with a solar roof system (SRS), was launched by Hyundai in 2019. Up to 30 to 60 % of the vehicle battery can be charged via solar energy even while driving. Additionally, it improves fuel efficiency and reduces CO2 emissions while increasing the drivers' travel distance by nearly 1300 km annually. Hence, the technological advancement of solar panel design and integration is positively influencing the growth of the market.

DRIVING FACTORS

Greater Awareness Regarding Environmental Pollution to Propel Adoption of Solar Vehicles

Internal combustion engine (ICE) based vehicles generate large quantities of CO2 emissions and other harmful gases. These vehicles are responsible for environmental degradation to a much larger extent. Solar vehicles considerably reduce the environmental impact by decreasing or eliminating fuel consumption (depending on fully electric or hybrid operation). Furthermore, they provide noise-free operation and require low maintenance compared to ICE based vehicles. Hence, an increase in vehicular emission concerns and eco-friendly operation of these vehicles are driving the growth of the market.

Increasing Demand for Energy-Efficient Alternative to Fossil Fuels to Aid Growth

Fossil fuels such as diesel and petrol are the source of ignition for the majority of vehicles across the globe. However, fuel reserves have decreased significantly over the last few years, and the surge in demand for personal mobility, particularly in India and China, has further increased energy consumption. Furthermore, the increasing fuel prices have compelled consumers to adopt energy-efficient alternatives such as solar vehicles that considerably reduce the average cost per km compared to conventional fuel-powered vehicles.

Hence, a rise in demand for energy-efficient sources for vehicle operation is attributed to the solar vehicle market growth.

RESTRAINING FACTORS

Low Operating Efficiency of Solar Automotive to Restrain Growth

The operating efficiency of solar-powered vehicles is lower compared to IC engine based vehicles. These vehicles rely on batteries that can only provide a limited driving range. Operation in bad weather conditions is also a considerable challenge as the vehicle battery will not charge if an electricity blackout occurs for several days. Furthermore, the speed and power of the electric-powered vehicles are not the same compared to conventional vehicles. Hence, these factors are primarily responsible for low adoption among consumers, which may restrain the growth of the market.

SEGMENTATION

By Vehicle Type Analysis

Passenger Car Segment Dominated in 2019 Owing to Greater R&D Investment

By vehicle type, the market is segmented into passenger cars and commercial vehicles.

The passenger car segment held a larger solar vehicle market share in 2019. Battery needs and integration of solar panels are comparatively simpler owing to the low propulsive force required by passenger cars. Furthermore, the growing investment in R&D activities is expected to favor the segment growth.

The commercial vehicle segment is anticipated to show good growth in the market owing to the increasing application of this technology for use in intra-city applications such as utility vans and last-mile delivery trucks.

By Battery Type Analysis

Lithium-Ion Segment Dominated in 2019 Fueled by Low Charging Time and Higher Range

Based on the battery type, the market is segmented into lithium-ion, lead-acid, and other batteries.

Lithium-ion (Li-Ion) batteries are lightweight and offer a higher energy density which translates to high efficiency and improved range for the vehicle. Furthermore, the weight of the Li-Ion battery pack is one-third of the lead-acid battery. Additionally,  the charging time is around 3 hours or less compared to nearly 10 hours required for lead-acid batteries. These are some of the factors attributed to the higher share of this segment.

The lead-acid battery segment is expected to show steady growth in the market owing to factors such as their large power-to-weight ratio and low production costs.

By Solar Panel Type Analysis

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Monocrystalline Segment to Hold a Larger Share of the Market Attributed to Higher Efficiency

By type of solar panel, the market is segmented into monocrystalline and polycrystalline panels.

Monocrystalline panels provide higher efficiency owing to their high-temperature coefficient that ensures low degradation of output (i.e. vehicle driving range, battery pack temperature, and other parameters). Furthermore, they are manufactured from superior grade silicone that ensures minimal resistance in electricity flow. Hence, the monocrystalline segment is anticipated to show significant growth in the market.

The polycrystalline segment is expected to show steady growth in the market. This can be attributed to a similar lifespan yet considerably lower cost compared to monocrystalline panels.

REGIONAL INSIGHTS

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North America is anticipated to showcase considerable growth in the market during the forecast period. Factors such as low battery costs and the increasing adoption of solar panels in hybrid electric vehicles are attributed to the high share of the market in this region.

In 2019, the market in Europe stood at USD 128.1 million. Favorable government support in terms of subsidies and stringent emission norms are responsible for the high share of electric vehicles (EVs) in this region. For instance, registration fees for plug-in hybrid vehicles were reduced by nearly 7% by the Dutch Government and only zero-emission vehicles will be sold in the country, by 2030. Solar panel integration with electric vehicles increases their efficiency, which may lead to high adoption of these vehicles in Europe during the forecast period.

Asia Pacific is anticipated to exhibit a higher CAGR during the forecast period. The rise in consumer purchasing power has increased the demand for urban mobility solutions in rapidly developing economies such as India and China. Additionally, the weather conditions in Southeast Asian countries such as India are also more suitable for these vehicles. Hence, these factors are expected to lead to the positive growth of the market in this region.

The rest of the world is anticipated to show steady growth in the market owing to the favorable government policies for solar panel production. For instance, in December 2019, import taxes for solar cells were eliminated by the Brazilian Chamber of Foreign Trade. Additionally, BYD, a major electric vehicle manufacturer, announced plans to double its production of solar panels at its Campinas factory in Brazil. These are some of the factors fueling the growth of the market in the region.

KEY INDUSTRY PLAYERS

Mahindra & Mahindra Ltd., Sono Motors, and Nissan are Leading Players in the Market

Key solar vehicle market players include Volkswagen AG, Mahindra & Mahindra Ltd., Ford Motor Company, Nissan, Sono Motors, and Lightyear, among others. The majority of the key players are investing heavily in R&D aimed at introducing cost-effective solar-powered vehicles and reducing the range anxiety concerns among consumers.

For instance, Sono Motors introduced its solar electric vehicle prototype the Sion, in March 2019. It is the world’s first series-produced electric car with solar integration. The vehicle is expected to provide a driving range of 255 km with an additional range of 34 km on a sunny day generated using the solar cells integrated into the vehicle architecture. Hence, the mass production of solar electric vehicles by key market players is anticipated to fuel the increased adoption among consumers.

LIST OF KEY COMPANIES PROFILED:

• Sono Motors (Munich, Germany)


• Volkswagen AG (Wolfsburg, Germany)


• Lightyear (Helmond, Netherland)


• Toyota Motor Corporation (Toyota City, Japan)


• Mahindra & Mahindra Ltd. (Mumbai, India)


• Cruise Car, Inc. (Arizona, US)


• Hanergy Thin Film Power Group Limited (Beijing, China)


• Ford Motor Company (Michigan, US)


• Nissan (Kanagawa, Japan)

KEY INDUSTRY DEVELOPMENTS:

• In July 2021, Lightyear finds a manufacturer to build its solar-powered EV. Finnish contract manufacturer -Valmet Automotive signed a letter of intent with Lightyear, and both the two companies’ plans to start building prototypes together in early 2022, with the beginning of production of nearly 1,000 vehicles till the midyear.


• In July 2021, Ford is readying a series of solar and smart energy products to go with its F-150 Lightning electric truck and other upcoming EVs. Ford announced that it is "spring-loaded" for growth during the second half of the year and beyond due to strong demand, including reservations, for its recent vehicle launches such as electric Mustang Mach-E crossover and redesigned F-150 SUV. Also, it has unveiled it received more than 120,000 reservations for an all-electric version of its F-150 pickup, the Lightning, since its debut in May, 75% of which or 90,000, are new to Ford.


• In May 2021, MAN Trucks and Sono Motors partnered to analyze the technical and economic feasibility of integrating Sono Solar technology into MAN’s eTGE electric transporter. SONO Motors has developed ‘Sion’ a solar electric vehicle that can provide an additional 150 miles of range per week by harnessing the power of the sun. In addition to SEVs, Sono Motors has built its entire company around clean mobility, sustainability, and affordability.


• In April 2021, Bridgestone partnered with the Netherlands-based startup Lightyear to provide specially developed tires for the upcoming Lightyear One solar car. Turanza Eco EV line of tires is being used, which is known to be helping to boost efficiency of the vehicle.

REPORT COVERAGE

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The solar vehicle market research report covers a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report delivers an in-depth market analysis of several factors that have contributed to its growth over recent years.

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