By Kari Williamson
Micro-hybrids, which use a small battery to provide varying degrees of efficiency-boosting features, will dominate the automotive market, gaining 42% of the overall light-duty vehicle market.
Simultaneously, the mild hybrids — superior to micro-hybrids but not as efficient as pure hybrids – could rise from near-zero to 1.5m vehicles in 2017, accounting for 1.6% of the auto market, according to the report Every Last Drop: Micro- And Mild Hybrids Drive a Huge Market for Fuel-Efficient Vehicles.
“Micro-hybrids will take over the automotive market, while mild hybrids will leverage the excessive build-out of Li-ion capacity to grow,” says Kevin See, Lux Research Analyst and Lead Author of the report.
“Micro-hybrids and, to a lesser extent, mild hybrids, provide a cost-effective solution to fuel savings to bridge the gap to more disruptive technologies like alternative fuels, plug-in vehicles, and fuel cell vehicles.”
To estimate adoption rates for micro-hybrids and mild hybrids, Lux researchers factored in the adoption of other fuel-saving technologies and modelled cost impact variations, besides estimating the costs of battery replacement and maintenance for the vehicles.
Lux' conclusions include:
- Europe will lead with China and the US in tow. Europe will continue its leadership in the micro-hybrid market, growing over three-fold to 12.6m units in the next five years. China will see explosive 81% annual growth to reach 8.9m units in 2017 and the U.S. will zoom from miniscule levels today to over 8 million in 2017;
- Medium micro-hybrids dominate. A low price premium, fuel savings of up to 10% and a relatively easier manufacturing process will propel medium micro-hybrids to the top of the alternative auto market over the next five years. These vehicles will grow at 36% CAGR to 22.2m vehicles in 2017, driven largely by the European market and automakers like Volkswagen;
- AGM battery technology will grow nine-fold. Absorbed glass mat (AGM), lead-acid batteries will dominate the market for storage of micro-hybrids, growing at 46% annually to nearly US$4bn in 2017. In mild hybrids, Li-ion will carve out a niche, growing from near-zero to nearly US$570m in 2017, capturing a 47% market share among plug-in vehicles.