Hybrids at the heart of future powertrains?

Which powertrain technology would you choose if you were to buy a car over the next 5 years? While electric and hybrid vehicles have already gained traction in developed nations boosted by government subsidies and policies, but they are yet to catch up in niche markets like India, Eastern Europe and Asia-Pacific.

Going forward, the growth opportunities in the key regional markets is going to vary considerably.

According to Frost & Sullivan’s recent analysis, Global Powertrain Outlook, 2020, demand for diesel engines is expected to decline in Europe by 30 per cent by the end of 2020 as Worldwide Harmonized Light Vehicles Test Procedure (WLPT) commences, while global electric vehicle (EV) sales are forecast to increase by about 3.4 per cent, spurring demand for gasoline-hybrid and fully-electric powertrains.

Meanwhile, in India, which is a relatively nascent stage, hybrid vehicle sales increased by 75 per cent from 2018 indicating opportunities for OEMs to explore the market, albeit on a lower base.

India was first made privy to the technology of hybrid cars with the introduction of Toyota Prius, the first hybrid model in India. Over time, most Indian & global manufacturers have warmed up to the idea of a hybrid car and have introduced various models like Toyota's Camry and Vellfire, Maruti Suzuki Ciaz SHVS and Baleno, Honda Civic and BMW i8 to name a few.

In 2016, the Delhi Government has reduced the VAT paid on Hybrid Cars in India from 12.5% to 5% igniting Consumers’ interest in the segment further. Better mileage and performance could be other factors dictating this shift in the market.

Diesel vehicles will also witness an increase in prices compared to gasoline due to the stringent norms of BS-VI norms which could act as another deterrent in demand for diesel powertrains.

The United States is expected to register about 1.13 million electric and hybrid vehicle sales in 2020, an increase of about 4.7 per cent, with a majority of the growth coming from Battery Electric Vehicles (BEVs) and mild and full hybrids.

China’s EV share is also expected to increase from 4.9 per cent in 2019 to 5.6 per cent in 2020. In South Korea, despite a decline of 1.6 per cent in recorded sales nation-wide and the end of the temporary tax cut in August, the Mild Hybrid Electric Vehicle (MHEV) 48V segment enjoyed whopping 283 per cent growth, as sales quadrupled in 2019.

Mild-hybrid powertrains and standardization of exhaust after-treatment technologies are major trends to impact the powertrain industry in 2020.

- Naga Karthik Voruganti, Frost & Sullivan

Mild-hybrid powertrains and the standardization of exhaust after-treatment technologies, such as selective catalytic reduction (SCR) and coated GPF, are major technology trends that could impact the powertrain industry in 2020, according to the report.

Commenting on some of the key trends, Naga Karthik Voruganti, Research Analyst, Automotive & Transportation at Frost & Sullivan said, “OEMs will focus on hybridizing existing internal combustion engine (ICE) vehicles as full hybrids have proven to help comply with stricter regulations and have also enjoyed consumer success in recent times.”

According to Voruganti, engine downsizing will continue, while the highly efficient gasoline direct injection (GDI) engines will continue seeing an increase in adoption.

The integration of gasoline particulate filters (GPFs) and three-way catalytic converters (3WCs) is expected to increase substantially in 2020 with more OEMs seeking to get their gasoline-powered vehicles certified under the new WLTP regulations.