Electric Ships Market

Electric Ships Market Size (2023-2028):

The Global Electric Ships Market was worth US$ 5.2 billion in 2022 and is anticipated to reach a valuation of US$ 10.78 billion by 2028 and is predicted to register a CAGR of 13.15% during 2023-2028.

Electric Ships Market has witnessed high growth in recent years due to an increase in seaborne trade and the implementation of the IMO Sulfur 2021 Regulation. Moreover, the growing maritime tourism industry is driving the expansion of the market.

Market Drivers:

An increase in seaborne trade, the growing maritime tourism industry, and the implementation of the IMO Sulfur 2021 regulation are the primary factors driving the global electric ship market.

An increase in the use of renewable energy for battery charging and advancements in hybrid propulsion technology may further drive the global market.

Market Restraints:

The primary factor restraining the adoption of fully electric vessels is the current battery technology. Also, the associated expenses are considerably high owing to factors like the shortage of battery charging infrastructure and the prices of energy storage as the current battery capacity is still low. Therefore, these factors are predicted to hamper the growth of the market.

Market Recent Developments:

• In November 2021: Hyundai Motors entered into a venture with Vinssen, a start-up based in Korea, to produce a new ship powered by hydrogen fuel cells by December 2021. Vinssen will provide 95kW hydrogen fuel cells. If the eco-friendly ship matches the expected level in terms of performance, it will be manufactured on a large scale.
• In September 2021: Corvus Energy was chosen by Holland Ship Electric for lithium-ion battery-based energy storage systems (ESS). They will be used in the five new all-electric ferries developed by Holland Shipyards Group for GVB, the municipal public transport operator for Amsterdam.

ELECTRIC SHIPS MARKET REPORT COVERAGE:

Market Segmentation:

Electric Ships Market - By Power Source:

• Hybrid       
• Fully Electric

The hybrid segment dominated the electric ship market with a market share of 81.3% in 2019 and is anticipated to hold its leading position throughout the forecast timeframe. Various benefits such as reliability offered by hybrid electric ships support its demand due to supplementary propulsion systems and better speed, decreasing the risk of failure and covering greater distances in lesser time. Hybrid electric vessel propulsion can be powered in two ways, namely electrical (via diesel-electric or battery power-driven) or mechanical (direct diesel driven).

Furthermore, ship-owners or shipping and logistic companies worldwide prefer hybrid electric ships to enable lower fuel consumption and reduce operational costs. The diesel-electric system's adoption at low power and a direct diesel-driven system in need of high power, i.e., inland water sailing with varying speed conditions, allows a reduction in operational cost in the electric ship. It is a smarter way to use available energy and save fuel costs by using hybrid electric ship propulsion. A fully electric vessel is foreseen to record moderate growth due to its preference for inland and nearby transportation worldwide.

Electric Ships Market - By Vessel Type:

• Military
• Commercial

Commercial electric vessels were valued at the largest market share of 77.1% in 2019. With growing production and globalization of trade, there has been an increase in the marine vessels added to the existing fleet. Rising competitiveness among logistics service providers and adopting a competitive pricing strategy is expected to fuel automated systems in commercial ships.

Electric Ships Market - By Power Output:

• <75 kW
• 75 - 745 kW

The 75-745 KW power output segment, controlled the market for electric ships and held 44.0% in 2019. In previous years, 75-745 KW power output ships are holding the major portion in the shipping industry. Increasing awareness related to environmental protection leads to the development of propulsion systems, increasing attention in the medium-sized marine vessel, driving the 75-745 KW segment. Advantages like less vibration and lower engine noise have also boosted electric vessels' growth in medium-size passenger and luxury ships. Moreover, the electric propulsion system encapsulates less space, providing more space for the interior and increasing its preferability in luxury ships.

Electric Ships Market - By Autonomy Level:

• Semi-Autonomous
• Fully Autonomous

Based on the level of autonomy, the market for the electric ship is categorized into semi-autonomous and fully autonomous. Semi-autonomous vessels captured the largest market share of 99.8% in 2019. Since fully autonomous marine vessels are predicted to be commercialized by 2021, the market sales have been primarily driven by semi-autonomous vessels. These naval ships are pre-equipped with systems and components like sensors, cameras, and navigation systems. Moreover, these systems can be installed in existing vessels that earlier had a manual operation.

The fully autonomous segment is predicted to observe the fastest growth from 2021 to 2027 due to several advantages that these vessels offer compared to semi-autonomous marine ships.

Market Regional Analysis: 

The Global Electric Ships Market Report includes the segmentation of regions:

• North America
• Europe
• Asia-pacific
• Middle-east and Africa
• Latin America

Europe was valued for the largest market share of 34.9% in 2019 and is anticipated to witness considerable growth over the forecast period. Germany emerged as a significant contributor to Europe's market growth due to the general population's rising environmental awareness and government initiatives to expand electrically operated transportation modes. Besides, the increasing popularity of electric recreational and leisure ships in marine tourism, aquatic sports, and fishing activities is anticipated to drive regional market growth. Nonetheless, the COVID-19 pandemic, which recently spread across European countries, especially Italy, U.K., Spain, and Germany, is expected to negatively impact regional market growth.

The Asia Pacific is estimated to come out as the second-fastest-growing regional market over the outlook period. Strong economic growth and high manufacturing rates are determined to help the region maintain its position as a manufacturing hub worldwide. Nonetheless, in recent months, there has been a considerable economic impact of the coronavirus pandemic on financial markets and vulnerable sectors, such as manufacturing, tourism, hospitality, and travel, in Asia Pacific countries, such as China and Japan, and India. These countries add significantly to market growth in the Asia Pacific. However, the slow growth of these countries due to the pandemic is expected to impact regional market growth. However, since China is coming close to its recovery phase, it is anticipated that this pandemic's impact on China's market development would be at a lesser rate over the conjecture period.

Impact of COVID-19 on Electric Ships Market:

The COVID-19 pandemic has forced original equipment manufacturers (OEMs) and investors to delay their investments in specific programs, such as autonomous vessel operations. Besides, disruptions in the supply of materials for battery systems are a primary concern for several manufacturers. Most raw materials, such as cobalt, nickel, and lithium, are shipped from Japan and China. But these nations are under complete lockdown amid the pandemic. We will help you better understand the current situation to look out for essential investment areas.

Market Key Players:

1. Kongsberg (Norway)
2. ABB (Switzerland)
3. Wartsila (Finland)
4. Norwegian Electric Systems AS (Norway)
5. Corvus Energy (Canada)
6. General Dynamics Electric Boat (US)