New Energy Vehicle Taxi Market to Grow 5.18% CAGR through to 2029

Advancements in Battery Technology, Changing Consumer Preferences are factors driving the Global New Energy Vehicle Taxi market in the forecast period.

According to TechSci Research report, “New Energy Vehicle Taxi Market - Global Industry Size, Share, Trends, Competition Forecast & Opportunities, 2029F”, the Global New Energy Vehicle Taxi Market was valued at USD 101.22 billion in 2023 and is anticipated to reach USD 136.64 billion by 2029, growing with a CAGR of 5.18% in the forecast period, 2025-2029. The global market of NEV taxi has been growing rapidly due to the growing awareness of environmental issues, incentives from the governments, and new technologies. NEVs such as BEVs, HEVs, and PHEVs are a plausible solution to replace the damaging effects of conventional gasoline-fueled taxis. Due to their high business mileage and high visibility on the roads, the taxi service sector is suitable for the uptake of NEVs in a bid to support sustainability objectives and follow the set legal policies. The major factor which is pushing the NEV taxi market is environmental consciousness and the desire to reduce carbon footprint. As the level of pollution continues to rise and the global efforts to fight climate change intensify, governments across the globe are putting in place measures to cut down on green house emissions. As a result, taxi operators are replacing their fleet with NEVs as per these regulations and contributing to the global cause. Also, consumer habits are changing and they are now more conscious of the environment, hence they will prefer NEV taxis.

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The fiscal support in terms of incentives, subsidies, taxation and policy on infrastructures reduce the initial and running costs of NEVs and are economically beneficial for the taxi service providers. Measures like zero-emission zones in cities make them force to utilize NEVs in order to meet the legal requirements. These two sources of support in the financial and regulatory levels promote market development by making NEVs more appealing to the taxi service. New technological inventions have shifted the performance and cost of NEVs thus making the vehicles suitable for use by taxis. New features in batteries have seen manufacturers extend the driving range, and reduce the charging time for the EVs, which were main concerns for users. The battery and other NEV components’ costs have declined, and manufacturing scale economies have cut NEVs’ upfront costs. Moreover, with the increase in charging stations and the development of fast charging ones, the range anxiety issue has been solved, thereby successfully incorporating NEVs into taxi services.

However, the following are the problems that confront the NEV taxi market: Charging infrastructure, or the lack thereof, is a constraint where issues such as the insufficient number of charging stations remain a concern. It is common for the taxi operators to raise issues with regards to charging infrastructure and range issues which act as factors that can deter the shift to NEVs. Overcoming these gaps in infrastructure is critical to realizing the market’s potential and the actual use of NEVs in the taxi service. Another challenge is the volatility of government policies and incentives that are required for these type of businesses. Although the governments of various countries today provide support for the use of NEVs through specific measures, it is not always possible to ensure the stability of such policies in the long term. This means that the market can be characterized by instability due to the variations in public support as influenced by changes in government priorities or the state of the economy. Policies on NEVs should be long-term and stable in order to give confidence to operators and investors to switch to NEVs.

The Global New Energy Vehicle (NEV) Market is segmented into powertrain, vehicle type, region and company.

In the Global New Energy Vehicle (NEV) Market, SUVs have emerged as the dominant vehicle type, surpassing hatchbacks and sedans. This dominance is attributed to several factors that align with evolving consumer preferences and technological advancements. SUVs offer more space, versatility, and comfort, making them highly attractive to buyers seeking larger vehicles for family use, long trips, or off-road capabilities. The increasing consumer demand for these features has led automakers to prioritize the development of electric and hybrid SUVs.

Technological advancements in battery systems have also played a crucial role. Modern batteries now provide sufficient range and performance for larger vehicles, addressing one of the major concerns regarding electric SUVs. Additionally, the growing network of fast-charging stations enhances the practicality of owning an electric SUV, further driving their popularity.

Government incentives and regulations supporting the adoption of electric vehicles have boosted the market for electric SUVs. These include tax rebates, grants, and stringent emission standards, which encourage both manufacturers and consumers to invest in NEVs. Consequently, the SUV segment's combination of consumer appeal, technological feasibility, and regulatory support solidifies its position as the leading segment in the NEV market.

Major companies operating in Global New Energy Vehicle Taxi Market are:

• Uber Technologies, Inc.
• Lyft, Inc.
• DiDi Global Inc.
• Bolt Operations OÜ
• Transopco UK Limited
• Grab Holdings Limited
• ANI Technologies Private Limited 
• Green Cabs
• BluSmart Tech Pvt Ltd
• Axoir Internet Ventures Pvt Ltd

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“The global new energy vehicle (NEV) taxi market is witnessing a revolutionary shift in urban transportation, driven by environmental consciousness, technological advancements, and government incentives. NEV taxis, including electric and hybrid vehicles, offer sustainable alternatives, reducing emissions and addressing climate concerns. Government initiatives, such as subsidies and regulatory support, propel the market's growth, fostering a cleaner and more efficient urban mobility landscape. Despite challenges like infrastructure development and initial costs, the NEV taxi market is on an upward trajectory, shaping the future of transportation with eco-friendly solutions, reshaping the narrative around urban mobility, and promising a greener, smarter, and more sustainable transportation ecosystem.” said Mr. Karan Chechi, Research Director of TechSci Research, a research-based management consulting firm.

“New Energy Vehicle Taxi Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented, By Powertrain (Battery Electric, Hybrid, and Plug-in Hybrid Electric), By Vehicle Type (Hatchback, SUV and Sedan), By Region, Competition, 2019-2029F”, has evaluated the future growth potential of Global New Energy Vehicle Taxi Market and provides statistics & information on market size, structure and future market growth. The report intends to provide cutting-edge market intelligence and help decision makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities in Global New Energy Vehicle Taxi Market.

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