Consumer Discretionary

Adoption And Integration Of Electric Vehicles in The GCC Region

<div style="text-align: justify;"><p>When and if you build an electric vehicle, people will come to use it.</p><p>No car is 100% clean. The advent of EV will not change that.</p><p>Our point is that if you really have to use a car, an electric car is a better choice for the environment.</p><p>It's a big debate these days for:</p><ul><li>Are EVs really zero-emission vehicles?</li><li>Is the process from procurement to production eco-friendly?</li></ul><p>&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Environmental Impact of EV </strong></span></h2><p>As we all know, EVs emit nothing from their exhaust gases, resulting in cleaner air.</p><p>Also, the fact that EVs produce 15% more emissions during production than gasoline-powered vehicles does not change the fact that they produce less or no CO2 while in use.</p><p>EVs have some environmental impact, but their overall contribution to reducing greenhouse gas emissions depends on factors like charging energy sources, manufacturing practices, battery technology and recycling.&nbsp;</p><p>As technology advances, the environmental benefits of electric vehicles are expected to grow. If renewable energies are used and can be operated with zero emissions, electric cars will reduce CO2 emissions by a quarter by 2030 and sooner zero-0 for the way forward.</p></div><div style="text-align: justify;"><p xml:lang="EN-US"><span xml:lang="EN-US" data-contrast="auto">&nbsp;</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}">&nbsp;</span></p></div><div style="text-align: justify;"><p xml:lang="EN-US"><span role="presentation"><img src="" width="216" height="212"></span><span xml:lang="EN-US" data-contrast="auto">&nbsp; &nbsp; &nbsp; &nbsp;</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}"> &nbsp; <img src="" width="452" height="246"></span></p></div><div style="text-align: justify;"><p xml:lang="EN-US">&nbsp;</p><p><strong>The GCC Electric Vehicle Charging Infrastructure Market</strong>, valued at USD 15.41 million in 2022, is projected to grow to USD 71.58 million by 2028, with a (Compound Annual Growth Rate) CAGR of 27.06%.</p><p>The expansion is fueled by increasing demand for EVs backed by government initiatives promoting adoption. This has led to a rise in charging infrastructure development, creating new opportunities in the forecast period.</p><p><strong>The GCC Electric Vehicle Market s</strong>ize is estimated at USD 3.66 billion in 2023 and is expected to reach USD 8.75 billion by 2028, growing at a CAGR of 19.03% during the forecast period (2023-2028).</p><p><em>Source: Mordor Intelligence Report </em></p><p>&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Global Major EV Players In GCC</strong>&nbsp;</span></h2><ul><li>Volkswagen</li><li>Tesla</li><li>BYD</li><li>Hyundai</li><li>Toyota</li><li>BMW</li><li>Nissan</li><li>Jaguar</li><li>Mercedes</li><li>Geely</li><li>SAIC</li><li>Polestar\</li><li>Honda &amp; other EU/Chinese EV startup &amp; new brands</li></ul><p>Where as TESLA AND BYD ARE IN RACE OF EV INNOVATION: BYD BEATS TESLA IN SALES IN 2024</p><p>&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Emerging GCC EV Market Players </strong></span></h2><ul><li>Al Damani made in UAE</li><li>NWTN Car Assembly in UAE</li><li>Mays Made in Oman</li><li>CEER made in KSA</li><li>Qatar's first electric vehicle brand VIM by EcoTranzit Company</li><li>Lucid manufacturing in KSA</li><li>The GCC region has traditionally been dependent on oil for energy and mobility but not anymore</li></ul><p>However, with growing environmental concerns and a global shift towards cleaner energy, the adoption of EVs in the region has gained importance for transitioning towards sustainable and environmental friendly mobility solutions.</p><p>&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Key Factors in EV Adoption and Integration </strong></span></h2><p>Several factors influence the integration and EV adoption in the GCC Region.</p><p><strong>Public Awareness</strong></p><p>It is crucial to educate the public about the benefits of EVs and dispel myths about range anxiety, cost of ownership, maintenance, and hassle-free lifecycle and style.</p><p><strong>Infrastructure development-Long recharging &ndash; Practical Difficulties </strong></p><p>One of the primary challenges in the GCC region has been the relatively limited EV charging infrastructure, which is a critical factor in the success of EV adoption.&nbsp;</p><p>Also, long recharging is a practical difficulty. Chargers for electric vehicles come in different types, and charging times vary depending on the charger and battery size. The prolonged charging duration is a major drawback for drivers who switch to EVs since the region is based on long distances in the interiors, especially in Oman and KSA.</p><p><strong>High Initial Cost/Economic Factors&nbsp;</strong></p><p>The upfront cost of electric vehicles remains a significant barrier, especially in a region where traditional fuel prices are relatively low. However, the long-term operational cost savings of EVs can still make them attractive.</p><p><strong>Lack of Unified Standards</strong></p><p>The absence of standard regulations and charging standards across the GCC countries hampers the seamless movement of electric vehicles.</p><p><strong>Environmental Concerns </strong></p><p>Making sure the incoming EVs can withstand the dry, desert terrain and heat of the region, although growing environmental awareness and concerns about air quality in some urban areas are driving interest in electric mobility.</p><p><strong>Consumer Preferences</strong></p><p>Consumer preferences are evolving, &amp; some individuals &amp; businesses are showing interest in the latest EV models for their eco-friendly features &amp; advanced technology.</p><p><strong>Fleet Adoption</strong></p><p>In some GCC countries, electric vehicles have been accepted in commercial fleets and in green corporate culture.</p><p>Companies with delivery or transportation services are increasingly adopting electric vans to reduce operating costs &amp; emissions.</p><p><strong>Collaboration with Automakers/Market Dynamics</strong></p><p>Several automakers have started introducing EV models to the GCC market or have announced plans to do so. Collaboration between governments, automakers, and local distributors is essential to ensure a variety of EV options are available to consumers, which helps them have a pool of MODEL VARIETIES to choose from rather than limited brands/vehicles/types.</p><p><strong>Enhancing EV to address emerging cybersecurity risks and firmware updates </strong></p><p>Smartphones, tablets and computers all require regular security updates to protect them from new or emerging cyber threats. EVs are no different. To facilitate the use of IoT devices &amp; soft SIMs registered in one Gulf jurisdiction to be complied with in another Gulf jurisdiction, additional efforts and regulatory guidance will be required.</p><p>&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Recommendations/Solutions </strong></span></h2><p>Each GCC country may have its specific challenges and solutions tailored to its unique circumstances, but these general strategies can guide efforts to promote EV adoption across the region.</p></div><div style="text-align: justify;"><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}"><strong>Financial Incentives</strong> : Governments should persist in providing financial incentives to enhance the accessibility of Electric Vehicles (EVs) across a wider demographic.</span></p><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}"><strong>Standardization</strong> : Collaborative initiatives among GCC countries to establish consistent standards for EVs and charging infrastructure would simplify cross-border mobility.</span></p><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}"><strong>Education Campaigns</strong> : It is recommended that governments and industry stakeholders invest in comprehensive awareness campaigns aimed at educating the public about the advantages of electric vehicles and dispelling any misconceptions.</span></p><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}"><strong>Infrastructure Investment</strong> : Ongoing investment in charging infrastructure, particularly in rural and remote areas, remains crucial to alleviating range anxiety and fostering the adoption of EVs.</span></p><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}"><strong>Local Manufacture</strong> : Manufacturers should continue to increase their focus on 'localizing' EVs for sale within the Gulf, with Arabic language support for EVs is a must, culturally and for safety reasons.</span></p></div><div style="text-align: justify;"><p xml:lang="EN-US">&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Visions and Net Zero Targets Defines Progress in GCC</strong></span></h2><ul><li>Electrification target initiatives KSA 30% by 2030 &amp; 100 % 2060</li><li>UAE 2050</li><li>Oman has set goals to reduce carbon emissions by 3% in 2030, 34% in 2040 &amp; 100% by 2050 with a target of 79% electric vehicles by 2035.</li><li>Bahrain, Qatar and Kuwait aiming for carbon neutrality by 2050.</li></ul><p><strong>Oman</strong></p><ul><li>Oman, aims to introduce a minimum 22,000 EVs by 2040, transition from fossil fuels by 2050.</li><li>Oman's home-made brand Mays unveils its first model, Alive 1, and plans to produce local components by year-end.</li><li>Country to install 350 public charging stations by 2026,</li><li>Oman offers zero VAT on EVs and spare parts, waives customs fees, provides free car registration, and collaborates with commercial agencies for exclusive EV deals.</li></ul><p><strong>Qatar</strong></p><ul><li>Qatar targets 25% of public transport using EVs by 2022, transitioning to 100% EVs by 2030.</li><li>Plans to install 15,000 public charging stations by 2030, aiming for 10% EV sales by then.</li><li>Investments from Qatar Foundation, Hamad International Airport, and Lusail City in EV infrastructure.</li><li>Partnerships with Volkswagen, Gaussin, Yutong, and government entities driving EV transformation.</li><li>The goal is to successfully use electric buses during the FIFA World Cup, with the aim of 100% electrified buses by 2030.</li><li>Surge in EV sales in 2023, 300% increase year-on-year, reaching around 600 units.</li><li>Commercial EV sales projected to increase by 40.5% in 2023, reaching around 1,080 units.</li><li>Construction of 30,000 electric charging stations by 2027, offering free charging until 2029.</li><li>Launch of Qatar's first electric vehicle brand VIM by EcoTranzit Company underway</li></ul><p><strong>&nbsp;Bahrain</strong></p><ul><li>Marson Group plans to establish an EV production factory in collaboration with Gauss Auto and aims to manufacture various EVs, including two-wheelers and passenger cars.</li><li>National Bank of Bahrain (NBB) partners with Bahrain National Insurance to enhance EV financial appeal.</li><li>Alliance offers reduced motor and electric vehicle insurance premiums, part of NBB's auto-lending initiative.</li></ul><p><strong>&nbsp; Saudi Arabia</strong></p><ul><li>CEER is already made in KSA</li><li>The agreement for vehicle collaboration with Human Horizons is $5.6 billion</li><li>Canoo partners with Olayan as exclusive distributor in Saudi Arabia</li><li>Venturing into autonomous vehicles with a 15% target by 2030</li><li>271% increase in EV imports in 2023, boosting Lucid's shares</li><li>Saudi Public Investment Fund and Saudi Electricity Company launch EV infrastructure firm, targeting 5,000 fast chargers by 2030</li></ul><p><strong>Kuwait</strong></p><ul><li>Kuwait Ports Authority approves "EV City" for Middle East EV manufacturers</li><li>Aligned with Kuwait's Vision 2035 for economic diversification</li><li>Developing regulations for electric car charger provision and expanding charging network</li><li>Focus on government and commercial buildings for charging point expansion</li><li>Efforts create opportunities for foreign EV manufacturers in Kuwait</li><li>Initiatives drive growth of Kuwait Electric Vehicle Market from 2023 to 2028</li></ul><p><strong>United Arab Emirates</strong></p><ul><li>Abu Dhabi invests $2.2 billion in NIO, holds 20.1% stake</li><li>UAE grants first self-driving car license to WeRide, targets 25% autonomy by 2030</li><li>Dubai Police partners with Acacus for driverless patrol vehicles by 2020</li><li>UAE plans 800 EVSE by 2024, aiming for 70,000 by 2030 with a $200 million investment</li><li>DEWA targets 1,000 EV charging stations by 2025, focusing on ultra-fast chargers</li><li>EtihadWE's initiative is for EV charging in the Northern Emirates.</li><li>Statevolt's $3.2 billion gigafactory in Ras Al Khaimah enhances energy storage</li><li>Einride's MOU with Ministry of Energy and Infrastructure for driverless trucks</li><li>Local brands Al Damani and NWTN's car assembly add to UAE's automotive landscape</li></ul><p>&nbsp;</p><h2><span style="font-size: 14pt;"><strong>Conclusion</strong></span></h2><p>Well, buckle up for a ride into the unpredictable future of electric vehicles (EVs). Trying to nail down the exact growth figures is difficult, but mark my words, EV ownership is going to shoot up like a rocket.</p><p><strong>Why, you ask?&nbsp;</strong></p><p>Blame it on those sky-high gas prices, the ever-expanding charging stations that are multiplying like numbers, batteries that are getting smarter than your smartphone, and let's not forget about EV costs that are dropping faster. They're also getting into the used car market, too, giving you more choices&mdash;we're talking electric boats, aircraft, and probably personalized flying pods in the works.</p><p><strong>Who said the future can't be electrifying? </strong></p><p>Our master plan should involve making people aware through open data, prepping our communities for the impending climate change rollercoaster, and educating them that their little steps could be the next moonwalk for mankind. If we execute this plan, we might just see the demand for a sustainable world skyrocketing towards net-zero emissions.</p><p><strong>Forget about low emissions; it's all about that net-zero life forward. </strong></p><p>Let's not sit around waiting for the apocalypse to knock on our doors. Society and communities are setting their sights on net zero, government policies are always supportive but we can't just kick back and let them do all the heavy lifting.</p><p>Let's show our planet some respect, love, adopt a sustainable attitude, and prove that being eco-friendly is not just a trend &ndash; it's the way to roll in this electrifying future!</p><p><strong>SO LETS GO ELECTRIC!!</strong></p></div><div style="text-align: justify;"><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}">&nbsp;</span></p></div><div style="text-align: justify;"><p xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}">&nbsp;</span></p></div><div style="text-align: justify;"><p><span style="font-size: 10pt;"><em>This article was contributed by our expert <a href="" target="_blank" rel="noopener">Adeel Irshad</a></em></span></p><p>&nbsp;</p><h3><span style="font-size: 18pt;">Frequently Asked Questions Answered by Adeel Irshad</span></h3></div><div style="text-align: justify;"><p>&nbsp;</p><h2><span style="font-size: 12pt;"><strong>1. Why is it Important to go Electric then?&nbsp;</strong></span></h2><p>The Paris Agreement, a binding climate change treaty, was adopted at COP21 in Paris on December 12, 2015, and took effect on November 4, 2016</p><p>To achieve its goal of limiting global warming to 1.5&deg;C, the world must reduce its emissions by 45% by 2030 and reach net zero by 2050</p><p>Given that transportation contributes 14% of global emissions, it's imperative to transition the sector to electric and renewable energy-based mobility solutions. This shift is essential for significantly reducing emissions and achieving our targets</p><p>In March 2022, the global electric car market was worth $105 billion, projected to reach $354.80 billion by 2028 (March 2022 report by Vantage Market Research)</p><p>To achieve net-zero emissions by 2050, new passenger vehicle sales need to be 31% in 2025, 64% in 2030, &amp; 100% by 2035.</p><p>Most major countries and car manufacturers plan to phase out fossil fuel vehicles after 2030 or 2040.</p><p><strong>Electric Car Market booming in 2023&nbsp;</strong></p><p>Q1 electric car sales: 2.3 million, up 25% from last year</p><p>Projected 2023 sales: 14 million</p><p>Global spending: Over $425 billion in 2022 (50% increase from 2021). (Analysis by IEA)</p><p>&nbsp;Electric car models: 500 in 2022 (double from 2018).</p></div><div style="text-align: justify;"><p xml:lang="EN-US">&nbsp;</p><p xml:lang="EN-US">&nbsp;</p><p xml:lang="EN-US">&nbsp;</p><p xml:lang="EN-US">&nbsp;</p><p xml:lang="EN-US">&nbsp;</p></div><div><p style="text-align: justify;" xml:lang="EN-US"><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:279}">&nbsp;</span></p></div>
KR Expert - Adeel Irshad

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