Vehicle electrification trend accelerates, boosts demand for DC motors

by Vianie Li & Cecile de Veyra

Most industries experienced a downturn in 2020 as a result of pandemic lockdowns, but the automotive industry’s electric segment differed with double-digit growth. Sales increased by 43 percent over the pre-pandemic level and snared a 4.6 percent share of the automotive market, according to Virta, a leading Finnish EV charging company. These doubled and reached 6.75 million units in 2021, and are on track to outdo this performance year after year.

Europe has been switching from gasoline-powered vehicles since 2019, with Germany, Norway, Iceland and Sweden the largest markets, according to the International Energy Agency.

Based on new vehicle registrations from January to May 2022, Virta said that there were already over 3.2 million units globally. This figure is expected to keep rising, driven by government subsidies as part of decarbonization efforts. In 2021, China had the most at 3.3 million units, followed by Europe with 2.3 million and the US with 630,000.

Based on IDC info, China’s new energy vehicle market will be 5.225 million units by end-2022, surging by 47.2 percent over the previous year. The volume is anticipated to reach up to 12.99 million units in 2025, with a CAGR of 38 percent from 2021.

This highly positive development will impact the upstream market in the years ahead. By the end of 2022, the global DC motor manufacturing segment will be on the scale of $4.4 billion, up from $3.5 billion in the previous year, according to Qianzhan Industry Research Institute. This will increase further to $5.4 billion in 2023 and $9.2 billion in 2026.

China, being the largest EV market, has been attracting motor manufacturers from home and abroad. Japan’s Nidec invested $740 million to build an EV motor factory in Dalian, Liaoning in 2021. The facility, with an annual production capacity of one million units, has already started operating on a mass scale.

There are more than 500 manufacturers of DC motors in China, including companies with investment from overseas, but only a fifth cater to the EV sector. Broad Ocean, Wolong, Jiangxi Special, Zhejiang Founder and Shenzhen Zhaowei are some of the leading homegrown suppliers. The rest are small and medium operations that lag behind foreign rivals in terms of technology.

To attract market attention, Chinese enterprises compete based on price-performance ratio, accept small orders, and offer fast turnaround time and aftersales services. Most export between 20 and 80 percent of production to Europe, North and South America and the Asia-Pacific region from their factories in Guangdong, Zhejiang, Jiangsu, Shaanxi and Sichuan. Many are found in Shenzhen, Dongguan, Zhongshan, Ningbo, Changzhou and Suzhou, and some in Xi’an and Chengdu.