The Middle East electric vehicle (EV) market could reach $54 billion by 2035, with EVs representing up to 64% of new car sales by that time, said Bain & Company in its new report. 

 

Titled "Is the Middle East Ready to Shift Gears to Electric Vehicles?" the report said as governments and businesses increasingly focus on sustainable solutions, the region is poised to become a leader in the global EV movement—provided key challenges are addressed.

 

The report identifies several critical drivers of EV adoption, including government policy, infrastructure development, and consumer demand. Yet, despite the promising outlook, the report also points to barriers such as high prices, a limited selection of EV models that meet local preferences, and a lack of charging infrastructure. Bain & Company’s analysis emphasises the need for coordinated efforts from both the public and private sectors to overcome these hurdles.

 

Early movers

“Early movers in the region have a unique opportunity to establish a strong brand presence and secure prime locations for charging infrastructure,” said Karim Henain, Partner at Bain & Company Middle East. “While still in its early stages, the electric vehicle (EV) market in the Middle East could reach $54 billion by 2035, potentially making up nearly two-thirds of new car sales. With the right strategies, incentives, and key players in place, this could unlock a significant opportunity for all stakeholders.”

 

Understanding EV buyer personas

The report segments Middle Eastern consumers into three distinct buyer personas: EV enthusiasts (~20%), EV explorers (~50%), and EV skeptics (~30%). These personas reflect varying levels of readiness to adopt electric vehicles, with enthusiasts leading the charge as highly motivated buyers driven by environmental values and a deep interest in cutting-edge technology.

• EV Enthusiasts – Willing to pay a premium and actively seek out EVs from both traditional and pure EV brands.

• EV Explorers – Open-minded but cautious, exploring EV options while weighing cost and infrastructure concerns.

• EV Skeptics – Hesitant to switch from internal combustion engine (ICE) vehicles without more robust infrastructure and competitive pricing.

To stimulate EV adoption across these segments, Bain & Company recommends targeted initiatives that cater to each group’s needs and concerns.

 

“Understanding the unique needs of these three customer segments is critical for successfully driving EV adoption in the region,” said Jimmy Nicolas, Partner at Bain & Company. “By targeting the specific preferences of EV enthusiasts and addressing the concerns of explorers and skeptics, businesses can tailor their strategies to capture the most valuable EV customers.”

 

Unlocking the region’s EV potential

The report highlights that achieving wide-scale EV adoption in the Middle East requires a multi-faceted approach, including:

• Government-Led Policies: Favorable regulatory measures, such as tax incentives, free parking for EVs, and investment in charging infrastructure, are essential to driving consumer demand. 

• OEM and Dealership Initiatives: Expanding EV model offerings, providing test-drive opportunities, and engaging in infrastructure projects can help dealerships transition to the EV era while maintaining profitability. 

• Charging Infrastructure Expansion: Building a robust network of fast-charging stations across key locations such as shopping malls, workplaces, and residential areas will be crucial to alleviating range anxiety and supporting EV growth.

 

“The shift toward electric vehicles in the Middle East is more than just an environmental necessity; it is a significant economic opportunity,” said Eric Zayer, Partner at Bain & Company. “Governments and businesses must act now to capitalise on this momentum, paving the way for a more sustainable and prosperous future.” 

 

The Middle East is on the cusp of a transformative shift in its automotive industry, with electric vehicles representing a key pillar of the region’s broader sustainability goals. Bain & Company’s report provides a roadmap for stakeholders to accelerate EV adoption, leveraging policy, infrastructure, and consumer insights to unlock the full potential of the market.--TradeArabia News Service