By Yange Ikyaa
China has consistently dominated the worlds electric vehicle (EV) market in nearly all facets. In 2022, the country exports of EVs increased in excess of 131.8 percent year-on-year to about 680,000 units, according to official figures. Then, in the first half of 2023, China sold 2,093,000 EVs, making the country an undisputed leader, with over half of EVs on the roads today being Chinese.
According to the International Energy Agency, China accounts for around 60% of global electric car sales, and has already exceeded its 2025 target for new energy vehicles.
Moving from Asia to the West, in Europe, the second largest market for EVs, sales rose by over 15% in 2022; while sales in the United States, the third largest market in the world, increased 55% in 2022, making the nation to claim a global market share of eight percent.
It has been estimated that electric vehicle sales are set for a 35% year-on-year increase in 2023, with national policies and incentives providing further impetus for producers and consumers. This has been rewarding for investors in developed EV markets and emerging ones, especially considering that the top 14 EV stocks with only a fraction of the market capitalization of their traditional auto giant peers ended up outperforming them on the stock market.
For instance, Rivian Automotive Incorporated is an American electric vehicle manufacturer with interest in electric adventure vehicles. It is renowned for collaborating with Amazon to deliver 100,000 electric delivery vans by 2030, marking a significant move in the electrification of commercial vehicles. While it is a relatively new player, its distinctive product offerings, commercial partnerships, and focus on sustainability could drive its growth in the coming years.
In Nigeria, progress in the EV market segment has been rather slow. In September 2022, Stallion Group said that it had sold less than 200,000 units of electric vehicles on offer, two years after it had launched the first-ever electric car assembled in Nigeria. This was blamed on consumers attachment to their fossil-fuel powered automobile models, even as access to electricity to charge the vehicles was also said to be undermining EV adoption in Nigeria. While the main issue with electric cars has never been the price or bad roads, the concern has always been where to charge them, considering epileptic power supply in Nigeria and the number of hours of electricity needed to keep the vehicles running, just as there are limited or non-existent charging points.
However, also here in the car-charging value chain, companies and countries are moving in to take advantage, and Nigeria must learn fast to follow or risk being left behind the enormous economic advantage. For instance, in the United States, QuantumScape Corporation is a developer of next-generation solid-state lithium-metal batteries for use in electric vehicles. The company’s proprietary technology aims to significantly improve the energy density and charging speed of batteries, while enhancing safety by eliminating the flammable liquid electrolyte found in conventional lithium-ion batteries.
The National Automotive Design and Development Council (NADDC) had initiated an electric vehicle pilot programme in Nigeria. It also collaborated with the Stallion Group, European Union and other stakeholders to roll out 100 solar-powered electric vehicle-charging stations across the country. Consequently, Sokoto became the first state in Nigeria to launch a solar-powered electric car charging station. Since then, only three other charging stations have been built in University of Lagos, Usman Dan Fodio University and the University of Nigeria, Nsukka. This implies that, the EV battery manufacturing in the country remains a tall dream, considering the pace of progress in the EV rollout process. It must however be noted that QuantumScape’s focus on solid-state batteries places it at the forefront of a potential revolution in battery technology, key to the EV market. If successful, solid-state batteries could address some of the biggest challenges facing electric vehicles, such as range anxiety and long charging times, thereby accelerating the adoption of EVs.
While QuantumScape could represent a strategic investment in the future of EV technology for investors, as the electric vehicle market grows, the demand for advanced battery technology is also set to rise. Apart from QuantumScape, Solid Power is another player in the race to develop solid-state batteries for electric vehicles. The company is backed by several big names in the automotive industry, including Ford and BMW, a testament to the potential of its technology.
By replacing the liquid electrolyte in traditional lithium-ion batteries with a solid one, Solid Power’s batteries could potentially offer higher energy density, improved safety, and lower costs. As the EV market continues to grow, the need for improved battery technology becomes increasingly urgent. Solid Power’s promising technology could be a game-changer, improving the viability and consumer appeal of electric vehicles.
Investors interested in the EV market would have to consider Solid Power as a potential investment in the EV supply chain. The company’s strong industry partnerships and the increasing demand for advanced batteries make it an interesting proposition. However, like any company working on cutting-edge technology, Solid Power faces technical challenges and will need to successfully commercialize its technology to succeed.
Another player in the market is Ballard Power Systems, a global leader in fuel cell technology, which is a crucial component for electric vehicle systems, particularly in commercial applications like buses, trucks, and trains. Ballard’s proton exchange membrane (PEM) fuel cells are highly efficient, durable, and suited for electrification of commercial vehicles, where longer range and quick refueling are essential. Ballard has moved a step further and is leading innovation in fuel cell drones, which can offer significant advantages over battery-electric systems in terms of flight time and payload capacity.
Beyond the manufacture of car parts, there is also an opportunity in general supplies to be taken by companies and countries. One of such companies is Magna International, which plays a significant role in the EV industry as a supplier rather than a manufacturer. The company is involved in many aspects of vehicle electrification, from powertrain systems to vehicle assembly, and its comprehensive range of services makes it a crucial partner for many automakers transitioning to electric vehicles. In addition, Magna is investing in next generation technologies, from advanced driver-assistance systems (ADAS) to solid-state Light Detection and Ranging (LiDAR). Its commitment to tech innovation allows it to support automakers not just with current needs but also future demands.
Then, although not directly an EV manufacturer, Westport Fuel Systems is working in developing advanced fuel systems, and the companys work is considered crucial to the transition towards sustainable transportation. The company is a leader in clean-burning, low-emission engine and fuel system technologies, helping commercial vehicles and heavy-duty truck manufacturers reduce their environmental impact. By offering technology that can transition vehicles towards cleaner fuels, Westport occupies a unique position in the market. Its systems are crucial in the drive towards reducing greenhouse gas emissions and reliance on petroleum fuels.
While the Nigerian electric vehicle market is in its early stages of development, with limited adoption due to high cost, improper infrastructure, and limited awareness among consumers, there have been some notable developments in the EV market of the country, such as government initiatives to promote the use of EVs and related infrastructure in the country. In addition, some private companies have begun importation and sales of EVs in Nigeria, while a Nigerian-based auto company, Jet Motor Company, has raised $9 million from foreign investors to intensify the creation of electric vehicles and boost market growth. The various government policies aimed at encouraging the adoption of electric vehicles includes tax incentives, subsidies, and reduced import duties. These incentives are meant to make EVs more affordable and attractive to consumers.
Furthermore, the increasing prices of fuel and price fluctuations make electric vehicles a more attractive option for consumers. Apart from this, electric vehicles are seen as a cleaner alternative to gasoline-powered cars, and their adoption could help reduce greenhouse gas emissions and improve air quality. Also, technological advancements in battery technology are making electric vehicles more affordable, with longer ranges and shorter charging times, and this could make them more competitive with conventional cars in terms of price and convenience.
The Nigerian electric vehicle market is anticipated to grow moderately through to 2026 and, although the country is lagging in the race for electric vehicles, the government is keen on encouraging electric mobility in the country to minimize the harmful gas and carbon emissions from the traditional combustion of fossil fuels, resulting in environmental degradation public health risks.
It is also hoped that the rising awareness among the people regarding environmental degradation and related benefits through the use of electric vehicles would accelerate the adoption rate of electric vehicles in Nigeria in the coming years.