Plug-in Hybrid Electric Vehicles Market size was USD 146.6 billion in 2024 and is estimated to reach USD 482.8 billion by the end of 2037, expanding at a CAGR of 9.6% during the forecast period, i.e., 2025-2037. In 2025, the industry size of plug-in hybrid electric vehicles (PHEV) will be valued at USD 160.7 billion.
Plug-in hybrid electric vehicles are gaining popularity worldwide owing to their ability to bridge the gap between conventional vehicles (gasoline-based) and electric vehicles (battery-based). The strict environmental regulations on carbon emissions and the sustainability trend are augmenting the sales of plug-in hybrid electric vehicles. As per the Research Nester study, hybrid electric vehicle ownership has surged over 17 million, globally. In addition, companies are investing in developing novel products, to lower emissions. For instance, in May 2023, Toyota Motor Corporation announced its all-new Prius PHEV model, Z grade with better performance and design.
Modern plug-in hybrid electric vehicles employed with regenerative brakes that convert kinetic energy to electric energy comply effectively with sustainability trends, mitigating carbon emissions. From the first developed gasoline electric vehicle ‘Lohner-Porsche’ in mid-1889 to current modern plug-in hybrid electric vehicles, the powertrain and engines have drastically evolved owing to continuous technological advancements by key market players.
Growth Drivers
Challenges
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Base Year |
2024 |
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Forecast Year |
2025-2037 |
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CAGR |
9.6% |
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Base Year Market Size (2024) |
USD 146.6 billion |
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Forecast Year Market Size (2037) |
USD 482.8 billion |
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Regional Scope |
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Power Source (Stored Electricity, On-board Electric Generators)
Stored electricity segment is poised to hold over 75.1% plug-in hybrid electric vehicles market share by the end of 2037. Most plug-in hybrid electric vehicles use stored electricity from the connected batteries. Charging equipment or regenerative braking systems provide power to plug-in hybrid electric vehicles. Compared to fully electric models where the charging device is installed externally, PHEVs are powered by batteries. The ongoing innovations in batteries such as lithium-ion batteries are boosting the overall performance of vehicles. For instance, automotive lithium-ion battery sales increased by 65% to 550 GWh in 2022 from 330 GWh in 2021.
Vehicle Type (Passenger Cars, Commercial Vehicles, Two Wheelers, Others)
By the end of 2037, passenger cars segment is estimated to capture around 87.5% plug-in hybrid electric vehicles market share, owing to the increasing popularity of hybrid electric vehicles for their energy-efficiency quality. The dual power source aspect is majorly contributing to the sales growth of plug-in hybrid electric passenger vehicles. In March 2024, JSW MG Motor announced its plan to launch new plug-in hybrid electric passenger vehicles in India.
Our in-depth analysis of the plug-in hybrid electric vehicles market includes the following segments
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Power Source
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Powertrain |
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Vehicle Type |
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Asia Pacific Market
Asia Pacific in plug-in hybrid electric vehicles market is set to dominate over 49.5% revenue share by 2037 owing to the strong presence of automobile manufacturers, rapid technological advancements in plug-in hybrid electric vehicles, and the increasing number of vehicle ownerships. Japan, China, and South Korea have a robust automotive manufacturing sector, which is directly increasing the sales of plug-in hybrid electric vehicles. The supportive government policies on electric vehicle adoption are also boosting the profits of PHEV manufacturers.
China is the fastest-growing economy in terms of population size, significantly influencing vehicle ownership rates in the country. The growing awareness of the benefits of electric vehicles is further contributing to the PHEV market growth. For instance, the International Energy Agency estimates that around 60% of new electric cars were registered in China in 2023.
Followed by China, India is also a lucrative marketplace for plug-in hybrid electric vehicle manufacturers owing to increasing public investments in EV charging infrastructure and auto component manufacturing. For instance, in August 2024, the India Brand Equity Foundation stated that the Ministry of Heavy Industries India approved around USD 96.13 billion for installing 7,432 public EV charging stations under the Phase-II of the FAME India scheme. Furthermore, the India EV market is anticipated to reach a valuation of USD 113.99 billion by 2029 and the EV battery sales are anticipated to be valued at USD 27.7 billion by 2028.
North America Market Statistics
The North America plug-in hybrid electric vehicles market is estimated to expand at the fastest pace during the forecast period owing to rapid advancements in battery technology, easy availability of a wide range of plug-in hybrid vehicles and the presence of advanced charging infrastructure. The presence of early adopters in the region is also drastically fuelling the demand for PHEVs.
In U.S. the hybrid electric vehicle sales are estimated to increase at a rapid pace during the forecasted period. According to the U.S. Environmental Protection Agency, currently, there are more than 50EV and PHEV models available in the U.S. market and this number is expected to boost in the coming years. Also, as per the U.S. Office of Energy Efficiency & Renewable Energy analysis, the sales of hybrid electric vehicles increased by 53% in 2023.
In Canada, the strict regulations on carbon emissions and increasing investments in advanced charging infrastructure are fuelling the sales of plug-in hybrid electric vehicles. According to a report by the Canada Energy Regulator, around 25% of new plug-in hybrid electric vehicles were registered in the country in 2022.
Key players in the plug-in hybrid electric vehicles market are investing heavily in R&D to introduce next-gen models. They are also collaborating with other players and tech firms to expand their product portfolios and reach a wider consumer base. Manufacturers are also employing investment strategies to expand their presence in the high-potential economies. For instance, Hyundai Motor India proposed to invest USD 2.45 billion in Tamil Nadu to boost its electric vehicle production in the country.
Some of the key players include:
Author Credits: Saima Khursheed
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