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The alternative fuels market size is estimated to grow at a CAGR of 6.04% between 2022 and 2027. The market size is forecast to increase by USD 78.41 billion. The growth of the market depends on several factors, including increasing emissions of GHGs, incentives for the development of alternative fuels, and rising need for cleaner fuels.
This alternative fuels market report extensively covers market segmentation by application (automotive and aviation), type (passenger cars and commercial vehicles), and geography (APAC, North America, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The rising need for cleaner fuels is notably driving the market growth, although factors such as fluctuations in global crude oil prices impedes the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
One of the key factors driving the alternative fuels market growth is the rising need for cleaner fuels. Due to uncertainty in global fuel prices, energy security, and continuously rising emissions, there is a rising demand for alternate fuels globally. Depleting fossil fuel reserves have also increased the demand for renewable biofuels. As biofuels can perform similarly to gasoline and diesel in terms of performance, third-generation biofuels or algae fuels have witnessed vast research and successful production, which is soon expected to reach commercial production.
Also, Euro-VI emission norms have been established in European nations that have become the basis of emission norms in other countries, such as India. Thus there is an increase in demand for cleaner fuels which will drive the alternative fuels market growth during the forecast period.
A key factor shaping the alternative fuels market growth is the increasing use of alternative fuels in the transportation sector. As the transportation sector is one of the major sources of air pollution, the need to reduce the carbon footprint in the transportation sector, which is one of the largest sectors responsible for GHG emissions, has led to the use of alternative fuels to run automobiles.
Over the years, the transportation sector has been witnessing increasing use of alternative fuels. one of the main reasons for this shift is due to the concerns over climate change, the need for energy security, and efforts to reduce dependence on fossil fuels. Thus, the rising concern for the environment is expected to boost the growth of the global alternative fuels market during the forecast period.
Fluctuations in global crude oil prices is one of the key challenges hindering the alternative fuels market growth. Due to the fluctuations in global crude oil prices and their impact on the prices of products like gasoline and lubricants, which are derived from crude oil, it can negatively affect the alternative fuels market during the forecast period.
According to the statistics provided, such fluctuations in global crude oil prices will affect the rate of adoption of alternative fuels, as the cost of conventional fuels is lower than that of alternative fuels. For instance, the prices in the oil and gas industry experienced a rapid drop during 2014-2016, which led to a reduction in E And P activities worldwide and also impacted the midstream and downstream segments. Thus the above factors can impede the growth of the alternate fuels market.
The market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Alternative Fuels Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Ballard Power Systems Inc.: The company offers alternative fuels for stacks and backup power systems. Also, the company offers sale and service of PEM fuel cell products for the power product markets of heavy-duty motive consisting of bus, truck, rail and marine applications, material handling and backup power as well as the delivery of technology solutions.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the automotive segment will be significant during the forecast period. The increase in the production of passenger cars, commercial vehicles, and two-wheelers globally has significantly contributed to the market share growth of this segment. For Instance, according to the World Bank, global GDP grew by 5.9% in 2021, and this increase in GDP, which is higher than that in 2020, as well as the rise in the disposable incomes of people, will increase the demand for vehicles, as improving economic conditions encourage more people to have their own personal transport.
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The automotive segment was valued at USD 141.59 billion in 2017 and continued to grow until 2021. As the automotive market is currently highly dependent on fossil fuels for operation, an increase in automotive sales is likely to lead to a similar rise in the demand for fuel. Also, there are government incentives and subsidies for clean energy sources to reduce the substantial impact of the sector on GHG can also contribute to the growth of global alternative fuels market during the forecast period.
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APAC is estimated to contribute 40% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
As the carbon emissions in the APAC region account for a significant share of GHG emissions globally, with China being the major contributor in APAC, followed by India, there are stringent initiatives being implemented to reduce carbon emissions. In addition, large manufacturers of alternative fuels, such as Royal Dutch Shell, are showing interest in establishing low-carbon fuel stations in APAC countries such as China, Indonesia, and India to reduce GHG emissions. Thus, such investments are expected to drive the growth of the alternative fuels market in APAC during the forecast period.
In 2020, the alternative fuels market in the region has witnessed significant challenges due to the outbreak of COVID-19 as it affected the supply chain of end-user industries, such as mobility and oil and gas, thereby affecting the regional economy. However, in 2021, the initiation of large-scale vaccination drives?has lifted the lockdown and travel restrictions in countries like China, Japan, and South Korea, which led to the resumption of delivery of alternative fuels. Such factors are expected to drive the market during the forecast period.
The alternative fuels market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Technavio categorizes the Alternative Fuels Market as a part of the global renewable electricity market within the global independent power and renewable electricity market. The parent global renewable electricity market covers companies engaged in the generation and distribution of electricity using renewable sources. The factors that drives the growth of the global renewable electricity market includes declining costs of renewable energy technologies, increasing demand for renewable power due to environmental concerns and stiff competition from well-established traditional electricity companies. Our market research report has extensively covered external factors influencing the parent market growth during the forecast period.
Alternative Fuels Market Scope |
|
Report Coverage |
Details |
Page number |
170 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 6.04% |
Market growth 2023-2027 |
USD 78.41 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
5.9 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 40% |
Key countries |
US, China, Japan, South Korea, and Germany |
Competitive landscape |
Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks |
Key companies profiled |
Ballard Power Systems Inc., Blossman Propane Gas and Appliance Inc., BP Plc, Chevron Corp., China Petrochemical Corp., CNOOC Ltd., ENGIE SA, Equinor ASA, Exxon Mobil Corp., Gazprom International Ltd., Gevo Inc., Hindustan Petroleum Corp. Ltd., Honeywell International Inc., LanzaTech Global Inc., Neste Corp., Nuvera Fuel Cells LLC, OMV Aktiengesellschaft, Petroleo Brasileiro SA, PJSC LUKOIL, and UGI Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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