Traction Inverter Market Research Report and Outlook by 2028

The Traction Inverter Market is projected to expand from US$ 13,128.48 million in 2021 to US$ 39,140.79 million by 2028, with an anticipated compound annual growth rate (CAGR) of 17.2% from 2022 to 2028.

Positioned between the high voltage system battery and the electric motor within the high voltage electrical framework of vehicles such as cars, trucks, and buses, the traction inverter plays a crucial role. It converts the direct current (DC) from the high voltage system into three alternating current (AC) output phases to drive the motor. As a fundamental component of electric vehicles (EVs), the inverter and motor collaborate to influence the vehicle's dynamics, performance, and overall driving experience. The efficiency of the motor and traction system under various driving conditions?such as acceleration, steady-state operation, and energy recovery through regenerative braking?has a direct impact on the vehicle's range. Power integration solutions provide gate drivers and power supply integrated circuits (ICs) for automotive-grade traction inverters, enhancing efficiency while minimizing costs and space requirements, all while ensuring functional safety. These packages comply with the latest standards for vehicles transitioning to 800 V designs, featuring reinforced isolation and extended creepage distances.

A significant factor driving industry growth is the marked increase in global demand for electric and hybrid electric vehicles. As the need for higher integration levels and enhanced power density in electric vehicles rises, automotive manufacturers and suppliers are ramping up production. Consequently, the automotive traction inverter market is expected to flourish, fueled by the growing demand for lithium-ion batteries, which are predominantly used in plug-in hybrids and electric vehicles. In 2020, the production of automotive lithium-ion batteries surged by 33%. Furthermore, advancements in technology, particularly wide bandgap (WBG) devices like silicon carbide (SiC) and gallium nitride (GaN), are propelling market growth. Silicon IGBT (Insulated Gate Bipolar Transistor) remains a preferred choice in the automotive sector due to its cost-effectiveness, efficiency, and short-circuit capabilities. Additionally, stringent regulatory reforms supported by government initiatives and market players create favorable conditions for increased traction inverter demand, particularly in light of the rising production of electric vehicles. The automotive traction inverter market is poised for evolution, driven by heightened awareness among consumers, original equipment manufacturers (OEMs), and various suppliers, spurred by stringent government regulations that promote the adoption of automotive traction inverters globally.

The traction inverter market is categorized based on propulsion type, vehicle type, voltage type, technology type, and geographical region. In terms of propulsion type, the market is divided into battery electric vehicles (BEV), hybrid electric vehicles (HEV), plug-in hybrid electric vehicles (PHEV), and others. Regarding voltage type, it is segmented into up to 200V, 200 to 900V, and above 900V. The technology type classification includes IGBT, MOSFET, and other technologies. Vehicle types are categorized into passenger cars, commercial vehicles, and others. The market is further segmented into five regions: North America, Europe, Asia-Pacific, the Middle East & Africa, and South America.

Key players in the traction inverter market include BorgWarner Inc., Delphi Technologies, Siemens AG, Mitsubishi Electric Corporation, Toshiba Corporation, Hitachi Ltd., Voith GmbH, Infineon Technologies AG, Denso, and Continental AG.

Impact of COVID-19 Pandemic on the Traction Inverter Market

The COVID-19 pandemic significantly disrupted the automotive industry, halting operations and limiting resources for future planning. The pandemic's impact placed immense pressure on the vehicle sector due to both demand and supply challenges. Lockdown measures resulted in a shock to both demand and supply, leaving little time for recovery. Exports of Chinese automotive parts and accessories, which are crucial for global vehicle production, faced substantial hurdles from supply chain disruptions. OEM assembly operations in North America, Europe, and Asia were adversely affected due to shortages from China. The U.S. experienced US$ 11.7 billion in disruptions from Chinese exports of vehicle components, making it particularly vulnerable. Japan followed with US$ 3.2 billion in export disruptions, while Germany, South Korea, and Mexico encountered similar challenges, hindering automotive industry advancements. Consequently, traction inverter manufacturers faced numerous obstacles, adversely affecting the growth of the automotive traction inverter market.

Despite the global pandemic's impact on the automotive sector, electric vehicle sales experienced remarkable growth. In 2019, 2.2 million electric vehicles were sold, representing only 2.5% of total global automobile sales, even as the overall automotive market contracted to 3 million units, accounting for 4.1% of total vehicle sales. By 2021, electric vehicle sales surged to 6.6 million, capturing over 9% of the global auto market, with electric cars alone contributing to the net increase in global auto sales.

Thus, while the COVID-19 pandemic negatively affected the automotive traction inverter market, the impact was relatively short-lived. By late 2022, the market is expected to have rebounded swiftly, with a robust demand for traction inverters emerging post-pandemic. This recovery is attributed to market participants reassessing their strategies and implementing rapid solutions to stabilize supply chains and regain momentum.

The overall size of the traction inverter market has been determined through a combination of primary and secondary research. The research process began with extensive secondary research utilizing both internal and external sources to gather qualitative and quantitative data about the market. This approach also aimed to provide an overview and forecast for all market segments. Additionally, primary interviews were conducted with industry stakeholders to validate the data and gain deeper analytical insights. Participants included industry experts such as VPs, business development managers, market intelligence managers, national sales managers, and external consultants specializing in the automotive traction inverter market.