According to our latest market study on "Fuel Cell Vehicles Market Forecast to 2028 - COVID-19 Impact and Global Analysis - by Electrolyte, Power Output, Vehicle Type, and Industry," the market is projected to reach US$ 6,051.17 million by 2028 from US$ 570.43 million in 2021; it is estimated to grow at a CAGR of 40.1% from 2021 to 2028.
Market Overview
Fuel cell vehicles are competing with plug-in electric vehicles to expand the market for alternative fuel vehicles. These vehicles offer several benefits, such as fast charging times, a longer range of more than 300 miles, and the emission of water vapor and warm air, which makes them more appealing for adoption in North American countries. The market for fuel cell vehicles is growing due to increased investment in research and development to enhance fuel cell technologies. For instance, the US Department of Energy (DOE) recently announced plans to invest US$ 100 million over the next five years to advance hydrogen and fuel cell technologies. This investment is aimed at promoting resiliency, energy security, and economic growth across various sectors. As a result, the growing adoption of emission-free vehicles to achieve the Paris agreement, along with promising investment prospects and regulatory support, is the primary factor driving the growth of the fuel cell vehicles market.
Market Dynamics
Hydrogen-powered fuel cells are the primary power source for fuel cell vehicles. Many countries worldwide are working on strategies to increase the adoption of these vehicles. Currently, most of the hydrogen produced globally is derived from fossil fuels. Therefore, stakeholders in the fuel cell vehicle market are emphasizing the shift toward green hydrogen production. The anticipated decrease in the cost of green hydrogen is expected to have a favorable impact on the expansion of the fuel cell vehicle market throughout the forecast period.
Market Segmentation
The market for fuel cell vehicles is evaluated based on the analysis of electrolyte, power output, vehicle type, and geographical regions. The fuel cell vehicle market is divided into two segments based on electrolyte, which are PEFC and PAFC. In 2020, the PEMFC segment dominated the fuel cell vehicle market, occupying a significant share of the market. The power output category is segmented into three sub-segments, which are up to 100 kW, 100-200 kW, and above 200 kW. In 2020, the up to 100 kW segment held the largest share of the fuel cell vehicle market. The fuel cell vehicle market is segmented based on vehicle type, which includes passenger cars, buses, trucks, and light commercial vehicles. The passenger cars segment accounted for the highest market share in 2020.
Regional Overview
According to the European Commission's statistics, green hydrogen produced through renewable sources is currently priced between US$ 2-6/kg, with an estimated decline to below US$ 1/kg by 2030. Several factors, including the development of electrolytes, increasing market players, economies of scale, and growing industrial applications, are expected to drive the demand for green hydrogen. The US government has implemented various strategies to achieve a completely clean energy economy by 2050. For example, the State Government of California has committed to investing US$ 20 million annually until 100 hydrogen fueling stations are built in the state. European countries have also undertaken multiple initiatives to boost the demand for fuel cell vehicles in the region, with the Hydrogen Roadmap Europe projecting that 45 million hydrogen-powered fuel cell vehicles will be on European roads by 2050. These initiatives by nations worldwide to increase the adoption of clean energy sources are anticipated to propel the demand for fuel cell vehicles during the forecast period.
Impact of COVID-19
The World Health Organization's (WHO) latest situation report highlights that the COVID-19 outbreak has heavily impacted numerous countries, including the US, India, Brazil, Russia, the UK, France, Italy, Germany, Argentina, and South Africa. The pandemic has also disrupted fuel cell vehicle businesses and vendors worldwide. Factory shutdowns, travel restrictions, trade bans, and border lockdowns have adversely affected the fuel cell vehicles market industry.
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