Global Electric Ships Market Size By Type (Fully Electric, and Hybrid), Vessel Type (Commercial, and Defense), Battery Type (Lithium-Ion, Lead-Acid, and Nickel-Based Batteries), By Carriage Type (Passenger, and Cargo) By End-Use (Line Fit, and Retro Fit) and Region - Market Share, Trend Analysis, Competitive Intelligence, Historical Data, and Forecast 2023 - 2030

Market Perspective

The global Electric Ships Market was valued at USD 6.12 billion in 2022 and is projected to grow to USD 14.31 billion by 2030, exhibiting a CAGR of 11.2% over the forecast period.

The market for electric ships has witnessed significant growth in recent years due to the growing concern regarding environmental sustainability and the need to reduce greenhouse gas emissions in the maritime transportation sector. Electric ships provide a clean and efficient alternative to traditional fuel-powered vessels by relying on electricity and battery systems instead of fossil fuels. The demand for energy-efficient solutions in the shipping industry has increased, as electric ships have demonstrated the ability to reduce fuel consumption and operating costs, making them an attractive option for both ship owners and operators. Moreover, advancements in battery technology, such as the development of high-capacity lithium-ion batteries, have greatly improved the range and performance of electric ships, thereby driving market growth.

Government regulations and initiatives aimed at reducing emissions from maritime transportation have played a crucial role in promoting the adoption of electric ships. Countries worldwide have implemented strict regulations and emission standards, incentivizing the use of cleaner and more sustainable technologies.

The market for electric ships further benefits from the investments made by key industry players in research and development. These investments focus on enhancing battery technology, expanding charging infrastructure, and improving overall ship efficiency, thereby contributing to the growth of the market.

Key Insights

• Based on type, the hybrid segment held the dominating position in 2022
• Based on vessel type, the commercial segment acquired the largest market share in 2022
• Based on carriage type, the passenger segment is expected to grow at the highest CAGR over the forecast period
• On the basis of region, Europe accounted for the largest market share in 2022

Growing Adoption of Electric Ships to Boost Market Outlook

The electric ships market is likely to experience significant growth over the projected timeframe, primarily driven by increased seaborne trade and the growing popularity of maritime tourism. The shipping industry plays a crucial role in the global economy, serving as the main transportation method for goods worldwide. This reliance on shipping highlights the market's significance in the sector. Additionally, there is a rising emphasis on environmental concerns within the industry, resulting in electric ships emerging as a favored option. The adoption of fully electric and hybrid ships not only reduces emissions but also contributes to a cleaner environment. This environmentally-friendly approach has resulted in a surge in the adoption of electric ships, thereby leading to market growth. Governments worldwide are implementing substantial measures to support the transition to electric ships and combat environmental pollution. For instance, the South Korean government has announced a significant investment totaling USD 870 million for the period between 2022 and 2031 to promote the development of eco-friendly shipping practices and mitigate pollution caused by the country's marine sector.

Limited Range Anxiety and High Purchase Costs to Restrain Electric Ships Market Growth

The market faces significant challenges, primarily related to the limited travel distance and capacity of these vessels. On average, electric ships can only travel approximately 80 km on a single charge, which poses obstacles for long-distance journeys, especially for larger merchant ships. This limitation greatly hinders the market's growth potential on a global scale. Additionally, the high costs associated with purchasing and maintaining electric ships act as a major barrier to market expansion. The lack of sufficient battery charging infrastructure and the expensive options for energy storage, considering the current limited battery capacity, contribute significantly to the overall expenses. These challenges are evident in the case of Norway, where the adoption of electric ferries has been impeded by the high costs associated with developing infrastructure and retrofitting existing vessels. As a result, these factors are expected to limit the growth of the market in the foreseeable future.

Recent Development

October 2023 (Acquisition): BEMAC and Mitsui, as the primary stakeholders, finalized a share purchase agreement to acquire complete ownership of The Switch from Yaskawa Europe Holding AB.

Segmentation Analysis

Based on type, the market is bifurcated into fully electric, and hybrid. Hybrid electric ships dominated the market, holding a significant revenue share in 2022. This preference is substantiated by the versatility of hybrid technology, offering a balance between fuel efficiency and extended operational range. The ability to switch between electric and conventional propulsion systems enhances adaptability and efficiency, crucial for diverse maritime applications. Additionally, hybrid electric ships address concerns regarding infrastructure limitations for fully electric vessels, making them a practical choice. This market trend is driven by a strategic approach to optimize energy consumption, lower emissions, and ensure operational flexibility, consolidating the position of hybrid electric ships as a preferred solution in the maritime sector.

Based on vessel type, the market is divided into commercial, and defense. The commercial segment is estimated to dominate the market in the foreseeable future, underscoring its significance in the global marketplace. This dominance is propelled by the burgeoning demand for sustainable shipping solutions in the commercial sector, driven by stringent environmental regulations and corporate sustainability goals. Commercial operators prioritize electric propulsion systems to reduce operational costs, enhance efficiency, and meet evolving emission standards. Moreover, the economic viability and scalability of electric technology in commercial vessels contribute to its market prominence. As the maritime industry increasingly emphasizes eco-friendly practices, the commercial sector's adoption of electric ships as a sustainable and cost-effective alternative solidifies its leading position in the market.

By carriage type, the market is categorized into passenger and cargo. The cargo segment experienced substantial growth in 2022 and is likely to continue to witness considerable growth through the projection period. The prominence of cargo vessels is propelled by the increasing demand for efficient and eco-friendly freight transport. Electric cargo ships align with global sustainability objectives, responding to the growing emphasis on reducing carbon footprints in logistics. Additionally, the economic feasibility of electric propulsion for cargo vessels, coupled with advancements in battery technology, has contributed to the rising adoption. As regulatory pressures intensify to curb emissions, the cargo segment's commitment to environmental responsibility positions it as a key driving force in shaping the landscape of electric ships.

Europe to Dominate the Electric Ships Market Due to Stringent Government Regulations and Initiatives

Europe is the largest market for electric ships due to the increasing popularity of electric vessels in marine tourism, water adventures, and fishing activities in the region. The growing adoption of electric ships in Europe is further propelled by various government initiatives that promote sustainable maritime transportation. For instance, the Clean Maritime Plan, announced by the U.K. in June 2019, mandates that all new ships ordered for European waters from 2025 must be equipped with batteries and powered by electricity instead of traditional fuels. The Clean Maritime Plan is an integral part of the U.K. government's long-term Maritime 2050 strategy, which aims to achieve net-zero greenhouse gas emissions by 2050. By implementing stringent regulations on greenhouse gas emissions, the government actively supports the demand for electric ships in Europe. This governmental backing, combined with the region's growing emphasis on sustainable practices, creates a conducive environment for the growth of the electric ship market in Europe.

Asia Pacific is the second-largest market for electric ships owing to improved battery storage, increased seaborne trade, and a burgeoning marine tourism industry. China and Japan are pivotal participants in actively pursuing large ship electrification as a means to reduce carbon emissions. The region's commitment to sustainability aligns with the rising demand for electric ships, driven by both environmental concerns and the need for more efficient and eco-friendly maritime solutions, particularly in light of growing seaborne trade and marine tourism.

Competitive Landscape

The global electric ships market is fragmented with key players such as Kongsberg, Leclanché SA, Corvus Energy, Echandia Marine AB, Anglo Belgian Corporation NV, Eco Marine Power, Akasol AG, Norwegian Electric Systems, General Dynamics Electric Boat, Wartsila, and Schottel Group, among others. Companies employ a variety of strategic measures such as acquisitions, mergers, partnerships, product introductions, and collaborations to expand their business globally and enhance their competitive position.

The global Electric Ships Market is segmented as follows:

By Type

• Fully Electric
• Hybrid

By Vessel Type

• Commercial
• Defense

By Battery Type

• Lithium-Ion
• Lead-Acid
• Nickel-Based Batteries

By Carriage Type

• Passenger
• Cargo

By End-Use

• Line Fit
• Retro Fit

By Region

• North America
• U.S.
• Canada
• Mexico
• Europe
• Germany
• U.K.
• France
• Italy
• Spain
• Russia
• Rest of Europe
• Asia-Pacific
• China
• Japan
• India
• South Korea
• Rest of Asia-Pacific
• Middle East & Africa
• GCC
• South Africa
• North America
• Rest of Middle East & Africa
• Latin America
• Brazil
• Argentina
• Rest of Latin America