Automotive Energy Recovery System Market Size, Share & COVID-19 Impact Analysis, By Subsystem (Turbocharger, Exhaust Gas Recirculation (EGR), and Regenerative Braking System), By Vehicle (Passenger Cars, Light Commercial Vehicles, and Heavy Commercial Vehicles), By Propulsion (ICE and Electric) and Regional Forecast, 2023-2030

The global automotive energy recovery system market size was valued at USD 17.12 billion in 2022. The market is projected to grow from USD 18.17 billion in 2023 to USD 29.60 billion by 2030, exhibiting a CAGR of 7.2% during the forecast period. The Asia Pacific dominated the Automotive Energy Recovery System Market with a share of 54.03% in 2022.

The automotive energy recovery system is a technology that captures and reuses the energy generated during braking or coasting in a vehicle. The system converts the captured energy into usable forms of energy, such as electrical energy, to power the vehicle's accessories or recharge the battery.

Several automotive manufacturers are focused on the development and production of advanced automotive energy recovery systems with low costs and high efficiencies. For instance, in March 2021, the Advanced Propulsion Centre received funding of EUR 54 million for its commitment across three zero-emission projects. Out of the total funding, EUR 11.3 million has been committed to Shield Manufacturing Technologies to develop & manufacture energy recovery systems designed for motorsport that are integrated with an e-axle and motor to reduce energy use in cars.

The automotive energy recovery system market growth is attributed to the implementation of stringent fuel emission regulations and standards by governments and regulatory bodies. The rise in fuel prices has made energy recovery systems attractive, which helps improve fuel efficiency and reduce the operating costs of vehicles. Moreover, the growing adoption of electric vehicles has resulted in increased demand for energy recovery system owing to its benefit of increasing the driving range. However, high adoption costs, complexity, and limited charging infrastructure restrain the market’s growth during the forecast period.

COVID-19 IMPACT

Implementation of Automotive Energy Systems into Electric Vehicles to Increase Range and Efficiency 

The outbreak of the COVID-19 pandemic impacted the market growth. The pandemic caused disruptions to the global supply chain, resulting in reduced production and the availability of energy recovery systems. The pandemic resulted in a significant decline in vehicle sales, as consumers faced financial uncertainty and prioritized spending on essential items.

However, automakers had to postpone product launches and production schedules due to the pandemic, which delayed the adoption of energy recovery systems in new vehicles. The pandemic also caused a reduction in research and development investments in energy recovery systems as companies prioritized spending on essential areas.

However, governments around the world announced support for measures to revive the automotive industry, including incentives for the purchase of electric vehicles, which use energy recovery systems. Along with this, major players increased their investment in research and development as electric vehicles gained popularity among the populace. This is attributed to propelling the market growth during the forecast period.

LATEST TRENDS

Growing Demand for Regenerative Braking Systems Drives Market Growth

Regenerative braking systems help to improve fuel efficiency by recovering energy that would otherwise be lost during braking operations. And this energy is used to charge the batteries of hybrid and electric vehicles. The growing demand for electric vehicles is creating a lucrative market for regenerative braking systems, which provide efficiency and increased range.

Moreover, the advancement in technology in these types of systems provides fuel efficiency, cost-effective solutions, and increased driving range for electric and hybrid vehicles. This is evidenced by the growth of the automotive energy recovery system market forecast. For instance, in August 2022, Brembo, an Italy-based company, developed an AI-based regenerative braking system called Sensify.

With the help of this, the company provided its application into electric vehicles with improved braking performance and reduced cost and complications in all types of vehicles. Brembo developed a radical digital system with Artificial Intelligence that cuts physical ties between the brake pedal and wheels of the cars. This fuels the market growth of the automotive energy recovery system over the forecast period.

DRIVING FACTORS

Stringent Vehicular Emission Rules and Regulations Fueled Market Growth

Governments around the world are implementing fuel efficiency and emissions standards for vehicles, which require manufacturers to adopt energy recovery systems to meet these standards. This helps the manufacturers comply with the regulations, which fuels the market.

For instance, the Euro 6/VI emission standard The NOX limit declines from 0.18 g/km to 0.08 g/km, a reduction of 56%. And to cater to these standards, major automotive players have designed and developed their vehicles. According to the Transport and Environment Department of the EU, research has shown that NOx emissions can be reduced to just 10% of the current limit (460 mg/kWh) using off-the-shelf technology. This creates a demand for automotive energy recovery systems in vehicles.

Increased Fuel Efficiency and Driving Range to Drive Market Growth

Energy recovery systems can help improve the fuel efficiency of passenger cars and commercial vehicles, which can result in significant cost savings for consumers. Adopting the system can give manufacturers a competitive advantage, as they can offer more fuel-efficient and environment friendly vehicles. In addition, the system can help improve the driving experience by reducing the energy needed to power the vehicle, which can result in improved acceleration and performance.

Additionally, the energy recovery system is also beneficial for increasing the driving range of the electric vehicle. For instance, in January 2022, Porsche announced its newly developed regenerative braking system. This system deployed in the Taycan Turbo S enables it to maximize the power of its regenerative braking system with up to 290 kW. This allows the system to generate sufficient electricity within two seconds of deceleration and adds an additional driving range of 700 meters for the vehicle. Due to this, the range of the vehicle increases by up to 30%, which enhances its overall performance. All these factors drive market growth during the forecast period.

RESTRAINING FACTORS

High Production and Maintenance Costs Hinder Market Growth

Energy recovery systems are expensive to develop and implement, which creates a barrier to adoption for some manufacturers and consumers. For instance, the components in regenerative braking have a complex structure and require higher maintenance costs. Therefore, integrating these types of systems can increase the cost of vehicles, making them less appealing to consumers looking for cost-effective options.

Additionally, there is a need for ongoing research and development to improve the efficiency of the system, which increases the cost. In March 2022, Continental AG, located in India, announced a joint venture with Nisshinbo Holdings Inc. (Japan). The new joint venture will produce and sell valve blocks, the main component of electronic brake systems (EBS) and regenerative brake systems. The joint venture will be valued at approximately 13 Million (JPY 1.9 billion), of which 60% will be owned by Nisshinbo HD and 40% by Continental. The plan is to begin its operation in April 2023.

SEGMENTATION

By Subsystem Analysis

Stringent Emission Norms along with High-Performance Requirements Propel the Subsystem Market

Based on the subsystem, the market is segmented into the turbocharger, exhaust gas recirculation, and regenerative braking system.

The turbocharger segment held a significant automotive energy recovery system market share in 2022. The turbocharger helps reduce emissions by allowing better combustion of fuel and, at the same time, increases the engine’s performance. This helps in meeting the emission standards implied by the government, which fuels the market growth.

The demand for exhaust gas recirculation (EGR) systems in automotive energy recovery system is primarily driven by the need to reduce emissions of nitrogen oxides (NOx) from internal combustion engines.

The energy lost during braking is captured and reused by the regenerative braking system. This energy is advantageous for recharging the battery or operating the electrical systems in vehicles. This helps in increasing the range of electric vehicles and the fuel efficiency of ICE vehicles. Thus, these advantages drive the market growth of the segment.

By Propulsion Analysis

Benefit of Increased Driving Range in Electric Vehicles and Mileage in ICE Vehicles Fuels the Propulsion Segment’s Growth

Based on propulsion, the market is categorized into ICE and Electric.

The ICE segment held the majority of the market share in 2022. ICE-based vehicles are the most widely used vehicles in the world due to their convenience, affordability, and availability. The concept of hybridizing ICE vehicles boosts the demand for energy recovery system in ICE vehicles.

Technologies such as regenerative braking and regenerative suspension systems capture and reuse waste energy and charge the battery, which helps increase the range of electric vehicles. Thus, the advantage of the extended range of electric vehicles drives the demand for energy recovery systems in electric vehicles.

By Vehicle Analysis

Increasing Demand for Fuel-Efficient and High Performance Vehicles Augments the Vehicle Segment

Based on the market by vehicle, the market is classified into passenger cars, light commercial vehicles, and heavy commercial vehicles.

The passenger cars segment was estimated to hold the largest market share in 2022. The passenger car segment’s growth is driven by the increasing demand for fuel-efficient and environmentally friendly vehicles.

Light commercial vehicles are primarily used for delivery and transportation, often in urban areas where stop-and-go traffic is common. This provides an opportunity for energy recovery systems, thus fueling market growth.

Heavy commercial vehicles, such as trucks, buses, and vans, typically operate over long distances carrying heavy loads, which require significant fuel. Hence, the need for improved fuel efficiency and reduced operating costs drives the market growth of the segment. Moreover, the increasing e-commerce sector fuels the demand for light and heavy commercial vehicles and electric vehicles.

REGIONAL ANALYSIS

The market is analyzed across North America, Europe, Asia Pacific, and the Rest of the World.

Currently, Asia Pacific region dominates the global market due to significant share in automotive production. The regional players are actively involved into the product innovation and developments related to the turbochargers and regenerative braking system that are helping to boost the overall market adoption in countries such as China, India, Japan, and others. Moreover, increased adoption of electric vehicles in 2021, as compared to 2020 has witnessed for market share growth.  For instance, in 2021, the sale of electric vehicles in China was 3.3 million units. This creates a lucrative demand for the automotive energy recovery market, thus driving the market’s growth.

Major players in North America, such as BorgWarner, have been focused on developing energy recovery systems such as exhaust gas recirculation (EGR) modules. This leads to increased efficiency, compactness, and cost-effectiveness of the system. This fuels the demand for the growth of the market in the region. For instance, in February 2022, BorgWarner announced that it had launched more than 80 EGR valves in 2021, adding them to its product portfolio.

In Europe, the growth of the automotive energy recovery market is attributed to the major automotive players focus on developing products related to increasing efficiency and conserving energy. For instance, in December 2022, BMW filed a patent for regenerative suspension system technology. This will help increase the electric vehicle range, which will propel the market growth during the forecast period.

The Rest of the World accounts for the Middle East and Africa and Latin America sub-regions. The increasing awareness about fuel efficiency and emissions reduction is driving the demand for automotive energy recovery systems in the region. Moreover, the growing automotive industry’s efforts to improve the efficiency and performance of vehicles fuel market growth.

KEY INDUSTRY PLAYERS

Companies Focus on Mergers, Partnerships, and Acquisitions to Advance Competitive Landscape

Various regional and international market players are constantly working on formulating advanced strategies to gain a competitive advantage. Many companies are forming collaborations and partnership strategies to enable market growth. In May 2021, BorgWarner, a leading company among a number of players in the global automotive energy recovery systems industry, secured a contract for eTurbo with a renowned OEM in Europe. BorgWarner's eTurbo can serve as a generator, collecting excess exhaust energy and converting it to electrical energy. This efficiently enables the use of a smaller battery, as recovered energy can be used to increase the vehicle's driving range.

List of Key Companies Profiled:

• BorgWarner Inc. (U.S.)


• Continental AG (Germany)


• Robert Bosch GmbH (Germany)


• Tenneco Inc. (U.S.)


• Rheinmetall Automotive AG (Germany)


• Hyundai Motor Group (South Korea)


• Cummins Inc. (U.S.)


• Mitsubishi Electric Corporation (Japan)


• GARRETT MOTION INC. (Switzerland)


• Enersgy Recovery (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• December 2022 – Rheinmetall acquired a contract worth around EUR 300 million. Under this contract, the company will provide exhaust gas recirculation modules to a Pierburg Group subsidiary. The order includes low- and high-pressure EGR modules. The systems contain an aluminum housing and a bypass with a fully integrated water-cooling circuit. The company will begin production in August 2026.


• May 2022 –Tesla upgraded its software for its vehicles to cater to the limited regenerative brake energy. With the help of this software, the vehicle will apply regular brakes when braking is limited. The feature is optional. This feature can even enable one-pedal driving as the driver does not need to touch the brake pedal and activate the regular brakes in an emergency.


• May 2022 – DS Automobiles, a luxury car manufacturer, developed an electric vehicle prototype. This electric vehicle is developed to use only electric motor regeneration. The company has acquired the technology from the Formula E race car. The DS E Tense Performance utilizes two onboard electric motors to slow the vehicle entirely with the help of regenerative braking, up to 600 kW. The company worked on exploring whether braking can be a method to slow cars down, helping to recharge the battery in the process.


• November 2021 – Continental AG launched a new regenerative braking system named MK C2. It is designed to install in a compact and lighter vehicle, providing high performance and increasing the range of electric vehicles. The system is designed with two independent partitions; thus, a redundant fallback level increases system availability, which can benefit automated driving. The MK C2 offers the functional scope for automated valet parking.


• July 2020 – Ford launched its all-electric MUSTANG MACH-E 1400 prototype in collaboration with RTR Vehicles and demonstrated the performance possibilities of electric propulsion. The MUSTANG MACH-E 1400 is incorporated with an electronic brake booster that allows series regenerative braking system to be combined with ABS and stability control to optimize the braking system of the vehicle. This braking system was developed by Brembo.

REPORT COVERAGE

The report provides a detailed market analysis of the market and focuses on key aspects such as leading companies, product/service types, and leading applications of the product. Besides, the report offers significant insights into market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.

Report Scope & Segmentation