In-Wheel Motor Market

The growth of the global in-wheel motor market is driven by various factors such as government initiatives to encourage adoption of electric commercial vehicles and expansion of global electric vehicle manufacturers into emerging markets. However, the high prices of electric vehicles and limited capacity of batteries are expected to restrain the market growth. Nevertheless, the increasing logistic activities are expected to create opportunities for market players during the forecast period.

The governments and respective state governments of various countries are taking certain initiatives to increase the awareness about using electric commercial vehicles to control the adverse impact on the environment and foreign exchange reserves. For instance, the International Council on Clean Transportation is working with the Zero Emission Vehicle regulation, progressive electric utility policies, greater model availability & marketing, consumer rebates, access to carpool lanes on congested highways, extensive electric vehicle charging infrastructure, access to high-occupancy vehicle lanes, and continued growth of local electric vehicle promotions. This is as the crude oil prices are continuously increasing.

The electric vehicle reduces the amount of noise and pollution generated compared to conventional vehicles. Commercial vehicles offer opportunities for more transport work at night, thus reducing the burden on the roads during the day. Therefore, many electric vehicle manufacturing companies are investing in product development to cater to the increasing demand from customers. For instance, in 2021, Renault Trucks developed the first electric truck, D Wide ZE, equipped with a tipper and a crane for Noblet Group and dedicated to the construction site approach. Also, Protean modified the Ford F-150 EV by removing the V8 engine and adding four in-wheel electric motors to the truck. Thus, if it is about an all-wheel-drive (AWD) vehicle -- either an off-road truck or a performance car -- that would require four in-wheel motors. Thus, the government initiatives to encourage the adoption of electric commercial vehicles are expected to drive the growth of the global in-wheel motor market during the forecast period.

The government initiatives are at a primary stage, as various countries are planning to introduce several regulations and initiatives in order to encourage the adoption of electric vehicles in the next few years. Hence, the impact of the government initiatives to encourage the adoption of electric commercial vehicles on the global in-wheel motor market is expected to shift from low to high over the forecast period.

Logistics companies are facing an era of unprecedented change as digitization takes hold and customer expectations evolve. New advanced technologies are enabling greater efficiency and more collaborative operating models. Thus, it is anticipated to be a driving factor for the in-wheel motor market.

The logistics & transportation industry in the US is highly competitive. The rapid increase in e-commerce sales is driving changes in the logistics industry. As per the US Department of Commerce, in 2020, total US e-commerce sales reached USD 787.9 billion, a 32.3% year-over-year increase from 2019’s USD 595.7 billion. The growth in e-commerce has resulted in a higher volume of low-value shipments. In response, retailers are increasingly decentralizing their distribution centers and establishing the “last-mile” fulfillment centers to keep inventory closer to consumers. This increases the demand for electric commercial vehicles for transporting the inventory to the closer distribution centers with zero emissions. For instance, in 2020, AB Volvo signed a contract with a third-party supply chain solutions provider NFI Industries, to successfully supply its VNR Electric heavy-duty trucks to transport freight under various operating conditions. North America's highly integrated supply chain network links producers and consumers through multiple transportation modes, including air & express delivery services, freight rail, maritime transport, and truck transport. To serve customers efficiently, several multinational and domestic firms provide tailored logistics and transportation solutions for ensuring the coordinated goods movement from origin to end user through each supply chain network, including truck transport. For example, DHL, one of the leading logistics companies in the world, uses electric vans. At the same time, Amazon announced plans to use electric delivery vans to be built by Rivian from 2021 onwards.

One of the greatest advantages of using in-wheel electric motors is the fact that the power goes straight from the motor directly to the wheel. Reducing the distance, the power travels increase the efficiency of the motor.

This shows the increasing logistic activities and the demand for in-wheel motors in electric commercial vehicles to fulfill these logistic activities. Thus, the increasing logistic activities are expected to create lucrative opportunities for the players operating in the global in-wheel motor market.

The cost of electric vehicles depends mainly on the batteries that are the source of powering the motor. These batteries are usually made up of expensive metals such as cobalt, nickel, lithium, and manganese that form two electrodes to store and release a charge. These metals need to be mined, processed, and converted into a highly pure form of chemical compounds, which requires significant capital. This makes electric vehicles much more expensive than conventional ICE automotive options. Additionally, the in-wheel motors are successful in two-wheel EVs, but they have rarely been seen in larger vehicles due to safety and cost concerns and a fear that unsprung weight gives a rougher ride.

Thus, the high prices of electric vehicles are expected to limit the adoption of in-wheel motors and consequently hamper the growth of the global in-wheel motor market, even though they offer higher returns in the long run-in terms of money and carbon emissions.

Electric vehicle manufacturers are constantly working to decrease the price by using low-cost materials. Thus, the impact of the high prices of electric vehicles on the global in-wheel motor market is expected to shift from high to low over the forecast period.