8.2% CAGR Anticipated for Marine Hybrid Propulsion Market During 2016 - 2024
In order to gain competitive edge, prominent players in the global marine hybrid propulsion market are investing in various research and development activities. This is a major factor motivating manufacturing companies to achieve product differentiation, finds Transparency Market Research (TMR) in a new study. As per reports, conventional hybrid propulsion manufacturing companies have continued designing hybrid propulsion for tugs and yachts. In addition, a majority of existing firms are concentrated in Europe, as the region boasts a sophisticated marine infrastructure.
Despite prevailing competition, companies such as Caterpillar, Inc., and General Electric have established themselves as strong market players. These companies enjoy being at the fore on account of their wide presence across the world and diverse product portfolio. As expansion strategies, mergers and acquiring established regional firms have emerged as popular choice for companies. Also energy-efficient solutions offered by companies such as Siemens AG and BAE Systems have helped them earn considerable boost.
Overall, the global marine hybrid propulsion market is forecast to exhibit a CAGR of 8.2% between 2016 and 2024. At this pace, the market’s valuation will reach US$5.25 bn by the end of 2024, from US$2.65 bn in 2015. By configuration, diesel-electric systems held dominance with a share of 53.3% in the overall market in 2015. These systems are easy to configure and install, which fuels their demand in the market. Regionally, Europe held the dominant share of 34.60% in the global market in 2015. While the region is forecast to remain lead through the forecast period, soon demand from Asia Pacific will surge, steering shift in focus from Europe to emerging markets.
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Marine Hybrid Propulsion Systems to Rank Higher on Account of their Fuel Efficiency
The marine industry is exploring systems ranking high on fuel-efficiency. Indigenous diesel mechanical propulsion systems usually consume the entire volume of installed power to function on a high power operating mode. Contrary to this, marine hybrid propulsion systems are connected to energy storage systems. The paradigm shift from fuel-based conventional systems to marine hybrid propulsion systems is thus steered by the latter’s fuel efficiency and cost-effectiveness. "With an increasing number of ship operators opting for renewable energy over conventional fuel at a storage option, the demand for marine hybrid propulsion systems is poised to surge further in the coming years," said a lead TMR analyst.
Furthermore, government across the globe have been proactively aiming towards minimizing carbon emission. Stringent regulations implemented in this regard will fuel the installation of hybrid propulsion systems in the marine sector.
Volatility in Crude Oil Prices to Remain a Major Concern
On the downside, the market is still reeling under the volatility of crude oil prices. However, this ongoing price fluctuation has steered the switch from diesel to LNG as the fuel used in propulsion. Furthermore, the relatively low price of natural gas and LNG than conventional fuel in Europe and North America has attracted huge investments in the LNG bunkering infrastructure of these regions. Besides this, the shift from high-carbon to low-carbon emission systems in the marine sector will give considerable impetus to the global marine hybrid propulsion market. Also strict sulfur regulations around ports in Singapore will impel the industry adopt more fuel-efficient technologies, thus giving the market significant impetus.
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