The demand for conventional fuel has always been at the rise due to widespread usage among the consumers across the globe. However, conventional fuel is a major concern for environmental hazards. Due to this reason, countries such as the U.S. and Italy are focusing on alternate forms of fuel in order to cater to the demand from consumers. The major reason for this switch is to reduce dependency of imports on foreign countries, which creates a burden on the economy. Fluctuations in fuel prices have affected the world economy and in order to avoid any further negative effects, many countries are focusing on reducing their usage of conventional fuel.
The global alternative fuel vehicles market is driven by the increasing demand for green vehicles. Green vehicles are powered by alternate options such as electric, solar and hybrid. Such vehicles are suitable for fighting global warming issues. Eco friendliness is another major factor driving the demand for vehicles with alternative fuel. Due to the increasing pollution level across the globe, manufacturers are increasingly stressing towards usage of alternative fuel in order to curb the issue. Consumers are showing increased preference towards such vehicles as well due to rising prices of conventional fuel.
Low market presence of alterative fuel is the major factor hindering the growth of alternative fuel vehicle market. Awareness about alternative fuel is very low in developing regions which is the major factor for the low growth of this market. However, the impact of this factor is analyzed to subside during the forecast period. Further, the performance of vehicles using alternative fuel is less compared to their conventional counterparts. Hence consumers preferring high performance would opt for vehicles with conventional fuel. Hence, this factor is highly restraining the growth of alternative fuel vehicles market at present.
The market is classified by fuel type into hydrogen, biodiesel, electricity, biomass, non-fossil methane, non-fossil gas and ethane. Further, alternative fuels find major application across several industries such as chemical, transportation, agriculture and others. Additionally, government vehicles, domestic vehicles, private fleets and industrial transportation are the major end users of alternative fuels. Private fleet and government vehicles are the major users of alternative fuel. North America is a prime region for alternative fuels as the U.S. government has supported the urgency to control its emissions. Further, North America is aiming at reducing their dependency on the import of conventional fuels which is likely to boost the market for alternative fuels in North America. Europe holds a significant share in the global alternative fuel vehicles market due to increased support from regulating bodies based in Europe. Italy serves as one of the biggest market for alternative fuel vehicles. Asia-Pacific is expected to witness a rapid growth during the forecast period due to increasing pollution. The Chinese government is offering lucrative incentive for buyers of alternative fuel vehicles which is complementing the growth of the market. Further, owing to the recent pollution related incidents in India, the government is undergoing a plan to bring in alternative fuel vehicles in the market in order to curb the growing issue regarding pollution.
Due to the rising issues related to global warming and diminishing fuel reserves among others, many vehicle manufacturers are focusing on manufacturing alternative fuel vehicles. Ford Motor Company, Hyundai Motor Company, Toyota Motor Corporation, Nissan Motor Co. Ltd., Honda Motor Co., Diamler A.G., Jaguar Land Rover Ltd. and Mitsubishi Motors are some of the key player operating in this market. Jaguar has been engaged in the development of internal combustion engines which can operate with electric motors. Range Rover Sport Hybrid is the world’s first luxury SUV running on alternative fuel, thus complementing Jaguars efforts.