Market Trends of GCC Electric Vehicle Industry
Huge Investments by Automakers for Electric Vehicles
Heavy investments from automakers are expected to cater to the growing demand for EVs and play a major role in the evolution of the electric vehicle market. OEMs offer electric vehicles in different segments ranging from hatchbacks such as the Nissan Leaf to high-end sedans like Tesla Model 3.
- In July 2023, PEUGEOT introduced its first fully electric light commercial vehicle, the PEUGEOT E-partner, in the United Arab Emirates. The vehicle was launched by PEUGEOT Abu Dhabi and Al Ain, the automotive division of Omeir Bin Youssef & Sons, and was delivered to EMOB, a sustainability company based in Abu Dhabi. EMOB specializes in providing EV charging services. The E-Partner, equipped with a robust electric propulsion system, offers efficient daily business operations.
Furthermore, the world’s top automotive companies are making huge investments in R&D activities, technological advances, product launches, and capacity & infrastructure expansion to produce millions of electric vehicles, along with batteries and raw materials.
- For example, in June 2023, Tata Motors announced plans to create a new electric vehicle subsidiary, which would require over INR 16,000 crore (USD 1.9 billion) of investment in the next five years. TPG Rise Climate and Abu Dhabi’s ADQ will be investing INR 7,500 crore (close to USD 1 billion) for an 11-15% stake to build and operate electric vehicle infrastructure across the United Arab Emirates and Abu Dhabi
- Similarly, in March 2023, United States-based electric vehicle maker Lucid Group, in which Saudi Arabia’s Public Investment Fund owns the majority, announced the setup of its first overseas factory to cater to the high demand for electric vehicles in the kingdom.
Thus, the above investments made by automotive giants for various production activities are projected to drive the market’s growth.
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Stringent Government Policies Favor High Market Demand
- The governments in the region are introducing several programs and initiatives to promote green mobility, as transportation plays a crucial role in lowering the carbon footprint. The programs aim for electrification of public transportation systems and make them a better mode of transport.
- In May 2023, Saudi Arabia announced implementation policies to develop an electric vehicle sector with increased production capacity to cater to the domestic market and operate as an export-oriented manufacturing hub. The production of about 500,000 EVs a year is being targeted by 2030.
- The Dubai Electricity and Water Authority launched an initiative called the “Green Charger” initiative to build charging stations in Dubai to support the Dubai Green Mobility Strategy 2030. The incentives offered by the government and various financial institutions are encouraging the import of electric vehicles into the country. The high support from the government in the form of favorable government policies is expected to bolster the sales of electric vehicles in the future.
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