Electric Vehicle Market

According to a research report "Electric Vehicle Market by Vehicle Type, Propulsion, Vehicle Connectivity, Component, End Use, P-EV market by EV Architecture, Top Speed, Drive Type, Body Type, H-EV market by Configuration, MHEV market by Topology, and Region - Global Forecast 2035" published by MarketsandMarkets, the plug-in electric vehicle market is projected to grow from USD 698.63 billion in 2025, and reach USD 1,189.59 billion in 2035, growing at a CAGR of 5.5%.

Browse 364 market data Tables and 161 Figures spread through 485 Pages and in-depth TOC on "Electric Vehicle Market by Vehicle Type, Propulsion, Vehicle Connectivity, Component, End Use, P-EV market by EV Architecture, Top Speed, Drive Type, Body Type, H-EV market by Configuration, MHEV market by Topology, and Region - Global Forecast 2035"
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The hybrid electric vehicle market (HEV+MHEV) is set to grow from USD 446.87 billion in 2025 to USD 667.75 billion in 2035, at a CAGR of 4.1%. The plug-in electric market is on a steady growth path, supported by rising consumer demand, government mandates for lower emissions, and advancements in battery and charging technologies that enable higher driving ranges, lower battery costs, and faster charging times. The development of charging infrastructure is also expanding to support this shift. Improvements in energy-dense batteries, efficient thermal management systems, and lightweight vehicle designs are driving the creation of new EV products and solutions that meet evolving customer expectations. As the market evolves, both plug-in hybrid and fully electric platforms are creating overlapping demand for components. This has led to increased use of conventional powertrain parts alongside EV-specific solutions such as lithium iron phosphate (LFP) battery packs, high-efficiency inverters, and advanced cooling systems. Automakers adjust their product lines to meet this blended demand while ensuring performance and reliability.

OEMs are making targeted investments to address cost and adoption challenges. Tesla is expanding localized battery production with its Gigafactories in the US and Mexico, while Volkswagen is investing in software-driven energy management systems to optimize efficiency. Hyundai is building scalable EV platforms to serve multiple vehicle types across regions. These initiatives help improve cost structures and accelerate EV adoption by making vehicles more affordable and efficient. Partnerships between automakers and suppliers are also growing, helping to overcome supply chain disruptions, meet safety standards, and enhance performance. Combined with government incentives, tax credits, and increased consumer awareness, these developments are redefining mobility trends and reinforcing the long-term outlook for electric vehicles.

The battery electric vehicle segment is estimated to witness the largest growth during the forecast period

The BEV segment is estimated to be the major growth driver in the electric vehicle market, securing the largest market share during the forecast period. Advances in battery technology are enabling more energy-dense and cost-effective solutions, supported by a growing range of models that boost consumer adoption. According to the International Energy Agency (IEA), global BEV sales rose about 35% year over year in the first quarter of 2025, with total electric car sales expected to exceed 20 million units in 2025. Leading manufacturers such as Tesla, BYD, and Geely are expanding their BEV portfolios to meet rising demand. Tesla’s Model 3 Performance, launched in April 2024, offers a top speed of 163 mph and rear-wheel drive, appealing to performance-oriented buyers. Similarly, BYD’s Sealion 05 EV, introduced in March 2025, provides advanced features and competitive pricing. These developments underscore the BEV segment’s strong position as the preferred choice for consumers seeking sustainable and high-performance vehicles.

The passenger cars segment is estimated to account for the largest share in the electric vehicle market during the forecast period

The passenger car segment is expected to hold the largest share in the electric vehicle market during the forecast period, driven by ongoing technological advancements, supportive regulatory frameworks, and growing consumer demand for sustainable mobility. OEMs are heavily investing in improving battery efficiency, expanding charging infrastructure, and enhancing overall vehicle performance. Tesla’s Model 3 and Model Y remain iconic, setting high standards for range, affordability, and market reach, with combined global deliveries reaching approximately 323,800 units in Q1 2025 and 373,700 units in Q2 2025, despite a year-over-year decline due to increased competition and supply chain challenges. Other popular models contributing to this trend include Volkswagen ID.4, Ford Mustang Mach-E, and BYD Song and Qin Plus, reflecting the diversifying consumer options globally. Leading manufacturers such as BYD, Tesla, Volkswagen, Geely, Stellantis, BMW, Nissan, Toyota, Honda, Hyundai, GWM, Mercedes-Benz, Volvo, and GM are actively expanding EV portfolios and ramping production capacities. BMW announced in late 2023 that its Munich plant will fully transition to electric vehicle production by 2027, becoming the first legacy plant in its network to do so. General Motors continues converting existing factories to EV-centric production despite recent challenges and moderating market demand in the US. Meanwhile, Europe maintains stringent CO2 emission targets aiming for a 55% reduction by 2030 and zero emissions by 2035, fostering enhanced EV adoption. In the US, growth has slowed notably amid policy uncertainty and rollbacks under the current administration, with significant cuts to incentives and federal support for EVs, impacting fleet electrification momentum and overall market expansion. In 2024, the Tesla Model Y was the best-selling battery electric vehicle globally, reaffirming passenger cars as the core growth driver in the evolving EV landscape.

China is set to be the largest market in Asia Pacific during the forecast period

China is estimated to be the largest market in the Asia Pacific electric vehicle market during the study period, driven by several key factors. As the world’s largest automotive producer and consumer, China’s scale in passenger car production creates a massive base for EV adoption. By 2025, new energy vehicles account for over 50% of new car sales, while, as per IEA, more than 90% of small cars sold in China are electric, underscoring the depth of market penetration. Leading OEMs like BYD, SAIC Motor, and Geely are expanding their EV lineups, while global brands such as Tesla are investing heavily in local production and charging networks. China’s dominance in battery manufacturing, with companies like CATL and BYD supplying a significant portion of global lithium iron phosphate (LFP) and other battery chemistries, strengthens its position as a key hub for EV growth. Government policies, including subsidies, mandates, and infrastructure investments, continue to accelerate the shift toward cleaner transportation. The country’s leadership in electric buses and shared mobility solutions further diversifies demand across vehicle segments. These factors, combined with strong supply chain capabilities, localized manufacturing, and regulatory support, position China as the largest and fastest-growing electric vehicle market in the Asia Pacific region.

Key Players

The major players in the electric vehicle market include BYD Company Ltd. (China), Tesla (US), Zhejiang Geely Holding Group (China), Volkswagen Group (Germany), and General Motors (US). These companies offer various electric vehicles and have strong global distribution networks. Companies are also actively launching new products and collaborating with other players to expand their market presence. In August 2025, General Motors (US) announced that it will be temporarily importing EV batteries from CATL (China) to support production of its affordable EV models, including the upcoming Chevrolet Bolt.

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