In 2022, the global electric van market was valued at 106,800 units and is anticipated to grow to 1,082,900 units by 2030, reflecting a CAGR of 33.6% from 2022 to 2030. The expansion can be attributed to the increasing need for last-mile delivery and distribution services, coupled with government efforts to minimize vehicle emissions.

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“By range, 100-200 miles segment expected to lead market during forecast period”

With a growing focus on long-distance transport, the demand for higher-range electric vans is expected to increase. Thus, manufacturers are focusing on introducing electric vans with a 100–200 miles range to cater to the intercity segment. For instance, in June 2022, Renault launched Master E-Tech Electric which is equipped with a lithium-ion battery and a range of 126 miles. In August 2021, Lyreco received 17 Master E-Tech electric vans with a range of 126 miles for delivery purposes in the European region. This range segment of electric vans is expected to witness prominent growth in the future due to the need for a reduction in environmental pollution.

“By propulsion, BEV segment to highest growth rate during the forecast period”

An electric van that runs completely on a battery is termed a BEV. The van runs with the help of a permanent magnet motor powered by a battery installed in the vehicle. Electric motors used in BEVs have high efficiency¯about 90% compared to ICE which is about 30-40%. The average range of BEVs varies based on battery type installation. The vans installed with the BEV propulsion system are generally used for last-mile delivery purposes. Since last-mile delivery is the most common application for electric vans, BEVs are expected to witness strong demand in the near future. Further, the electricity used to power the vans costs less than diesel fuel, which further lowers the operational costs for vans. With advancements in battery technology and a continuous decrease in battery prices, the overall costs of BEVs are expected to decrease in the coming years.

Driver: Increasing demand for emission-free and energy-efficient mass transit solutions

The transport sector is one of the largest contributors to global greenhouse gas (GHG) emissions. According to the United Nations Environment Program (UNEP), the transport sector contributes around one-quarter of greenhouse gas (GHG) emissions and is one of the largest sources of air pollution. Vehicle emissions are responsible for discharging 29% of ozone-depleting substances that bring air pollution and are dangerous to the atmosphere. Various governments across the globe have introduced initiatives to make their urban public transport system more sustainable and fuel-efficient with the use of electric vans. The introduction of electric vans will change mass transit worldwide in the coming years by improving air quality, reducing noise levels, and increasing fuel efficiency.

Restraint: Low vehicle range hampers long-distance logistics

Many electric commercial vehicle fleet owners are concerned about the range or distance covered in a single charge. The driving range of electric vans is shorter than that of ICE commercial vans. Many ECVs cover distances between 80 miles and 120 miles because of the low energy density of batteries. The maximum coverage of an ECV is ~300 miles. Users prefer covering long distances without interruptions, especially for long trips, and a long-range EV is significantly high priced. This factor could inhibit the growth of the electric van market. Various R&D efforts are undertaken to reduce the space required for housing and contacts so that more batteries can be accommodated, and the van range can be increased to approximately 600 miles. FCEVs have a huge opportunity for electric vans due to the less demand for frequent charging (which hampers commercial use in many cases).

Opportunity: Government support for electrification of public transport

In order to drive the commitment to reduce greenhouse gas (GHG) emissions and improve air quality in urban areas, governments across the globe have been providing lucrative fiscal incentives to promote shared mobility and clean transportation. Governments across the globe have launched attractive initiatives and schemes to facilitate the adoption of electric vehicles. Governments in developed countries have begun the tender process to increase the use of electric vans in their cities. For instance, as of March 2022, Royal Mail conducted its delivery using 3,000 electric vans. The roll-out largely follows cities with low-emission zones, including London, Bristol, Glasgow, Cambridge, and Oxford. The induction of e-vans will add to the emission reduction commitments at the local level. The benefits will be much greater with the simultaneous greening of electricity generation in highly populated cities like China, Japan, and India.

Challenge: Lack of charging infrastructure

The growth of the electric van market has been restrained due to the limited availability of supporting infrastructure. Every electric vehicle periodically requires a battery charging facility. Charging infrastructure is installed in urban areas in Europe, North America, and other developed regions. However, the number of charging stations is insufficient. The number of charging stations in Eastern Europe is lesser than that in Northern Europe. In Asia Pacific, China is leading in terms of the availability of charging stations. The time taken to recharge a vehicle further adds to the inconvenience. As of 2022, only a few companies provide fast chargers. As chargers are available in different designs and every charger uses a different connector, finding a suitable charger can be cumbersome. The lack of charging infrastructure is a major problem in developing economies such as India, South Africa, and South Korea. India has adequate infrastructure for internal combustion engine vehicles with as many as 77,000 fuel stations across the country.

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