The global alternative fuel and hybrid vehicle market was US$ 451.9 billion in 2021. The global alternative fuel and hybrid vehicle market is forecast to grow to US$ 7,256.0 billion by 2030 by registering a compound annual growth rate (CAGR) of 31.5% during the forecast period from 2022 to 2030. 

Alternative fuel vehicles work on compressed natural gas, liquid nitrogen, electricity, biofuel, biodiesel, fuel cell, and dimethyl ether. Dedicated vehicles, bi-fuel vehicles, and dual-fuel vehicles are some of the biofuel-operated vehicles.

Factors Influencing the Market

• The growing popularity of clean mobility solutions is forecast to fuel the growth of the global alternative fuel and hybrid vehicle market. 
• The market is forecast to witness tremendous growth, owing to the continuously rising prices of fossil fuels. 
• Growing environmental concerns among citizens and initiatives by government bodies are expected to drive the global alternative fuel and hybrid vehicle market forward. For instance, the Indian Government increased the subsidy on the purchase of electric vehicles to prompt the adoption of electric vehicles. The government of China has also unveiled various such initiatives. 
• The shortage of fossil fuels will also escalate the growth of the alternative fuel and hybrid vehicle market. 

COVID-19 Impact Analysis

The wake of the COVID-19 pandemic has negatively affected the alternative fuel and hybrid vehicle market. It is owing to the sudden implementation of lockdown restrictions. The demand for vehicles reduced drastically as the governments imposed travel restrictions. In addition, the pandemic also affected the employment rate, which ultimately affected the purchasing power of the consumers. Thus, the COVID-19 pandemic impeded the growth of the global alternative fuel and hybrid vehicle market. 

Regional Analysis

Europe is forecast to exhibit the highest growth rate. It is owing to the stringent emission norms by the governments. In addition, the region is witnessing rising demand for alternative fuel and hybrid vehicles due to the continuously increasing rate of fossil fuels. In 2021, Europe registered a drastic increase in gas prices due to reduced gas supply from Russia and unfavorable weather conditions. Thus, it will contribute to the growth of the alternative fuel and hybrid vehicle market. Furthermore, growing disposable income and the presence of prominent industry players, such as BMW, Volkswagen AG, etc., will contribute to the growth of the alternative fuel and hybrid vehicle market. 

Competitors in the Market

• BMW Group
• Ford Motor Company
• Honda Motor Co., Ltd
• Mercedes-Benz Group AG
• Mitsubishi Motors Corporation
• Nissan Motor Co., Ltd
• Tesla, Inc.
• Toyota Motor Corporation
• Volkswagen AG
• BYD Company Ltd.
• Other Prominent Players

Market Segmentation

The global alternative fuel and hybrid vehicle market segmentation focuses on Fuel, Vehicle Type, Vehicle Class, and Region. 

By Fuel Type

• Hybrid Vehicles
• Plugin Hybrid Vehicles
• Battery Electric Vehicles
• Others (Gaseous Fuels, Biofuels)

By Vehicle Type

• Passenger Cars
• Light Commercial Vehicles
• Heavy Commercial Vehicles

By Vehicle Class

• Economical Vehicles
• Mid-priced Vehicles
• Luxury Vehicles

By Region

• North America
• The U.S.
• Canada
• Mexico
• Europe
• Western Europe
• The UK
• Germany
• France
• Italy
• Spain
• Rest of Western Europe
• Eastern Europe
• Poland
• Russia
• Rest of Eastern Europe
• Asia Pacific
• China
• India
• Japan
• Australia & New Zealand
• ASEAN
• Rest of Asia Pacific
• Middle East & Africa (MEA)
• UAE
• Saudi Arabia
• South Africa
• Rest of MEA
• South America
• Brazil
• Argentina
• Rest of South America