PRZOOM - /newswire/ -
Palo Alto, CA, United States, 2007/08/15 - New analysis from Frost & Sullivan, World Hybrid Electric Vehicles and Electric Vehicles Battery Markets, reveals that the market expects to produce $608.5 million in revenues in 2007, growing at a rate of 14.8 percent compounded annually.
With soaring gas prices and increasing concerns about global warming and melting of polar regions, developed countries turn to alternative, environmental friendly technologies to reduce dependency on oil and conventional fuels. This move drives demand for hybrid electric and electric vehicles (HEV/EV) and is highly conducive for growth opportunities for the world HEV/EV batteries market.
New analysis from Frost & Sullivan (batteries.frost.com), World Hybrid Electric Vehicles and Electric Vehicles Battery Markets, reveals that the market expects to produce $608.5 million in revenues in 2007, growing at a rate of 14.8 percent compounded annually.
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“In order to reduce dependency on oil and conventional fuels, governments will launch many regulations and promotional initiatives that provide various tax credits and concessions to those using zero emission, environmental friendly vehicles,” says Frost & Sullivan Research Analyst Suba Swaminathan.
Owing to such governmental endorsements and tax benefits, the battery market currently attracts increased investments in new technological developments and innovations that aim to improve the performance and efficiency of batteries.
The market faces challenges due to the lack of an ideal battery chemistry that could offer desirable performance at an affordable price. Currently batteries are highly priced and being the chief source of power in a vehicle, their high costs invariably affect the price of the vehicle. This factor decreases the affordability of vehicles and significantly diminishes market growth, placing enormous strain on the profitability of manufacturers and posing a serious challenge to some of the market participants.
Nevertheless, this impact will likely taper off in the next two to three years as affordable, high performing batteries hit the market as a result of ongoing, intense research efforts. The entry of more market participants expect to counter this challenge.
“Presently, the HEV/EV battery market is in its initial stage and witnesses steady growth patterns, resulting in the replacement of batteries in the next five years,” concludes Swaminathan. ”This cyclic trend in demand boosts market growth.”
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