Off-highway EV Component Market Size & Share 2025 – 2034

Off-highway EV Component Market Size

The global off-highway EV component market size was valued at USD 15.3 billion in 2024 and is projected to grow at a CAGR of 8.1% between 2025 and 2034. The electrification of construction, mining, and agriculture equipment is a major growth driver for the market, as industries shift toward cleaner, more efficient machinery. Electric equipment reduces fuel consumption, lowers emissions, and minimizes maintenance needs—benefits that are increasingly valued in regulated and environmentally sensitive work zones. Governments and organizations are mandating or incentivizing low-emission operations, pushing OEMs to adopt electric solutions.

For instance, in April 2025, Sandvik secured its largest-ever battery-electric vehicle (BEV) order from Australian miner South32, valued at around SEK 750 million (approximately AUD 121 million). The order is for 22 battery-electric underground mining machines, including trucks, loaders, bolters, development drills, and longhole drills, to be deployed at South32’s greenfield Hermosa critical minerals project in Arizona, USA.
 

Increased investments in smart cities are a significant growth driver for the off-highway EV component market. As governments and private sectors focus on sustainable urban development, there is a growing demand for energy-efficient, low-emission construction and public service equipment. Electrification of off-highway vehicles such as excavators, bulldozers, and cranes used in smart city projects is crucial for reducing the environmental impact of infrastructure development.
 

For instance, according to Statista, the smart cities market worldwide is expected to witness a significant revenue growth, with projected revenue reaching USD 79.94 billion in 2025. This growth is further expected to continue at a compound annual growth rate (CAGR) of 9.60% from 2025 to 2029. As a result, the market volume is anticipated to reach USD 115.33 billion by 2029.
 

Off-highway EV Component Market Trends

• Continuous improvements in battery energy density, charging speed, and lifespan are enhancing the performance and viability of off-highway electric vehicles (EVs). These advancements enable longer operational hours and reduced downtime, making electric machinery more appealing for industries like construction and mining.
   
• The incorporation of autonomous systems and connectivity features in off-highway EVs is transforming operational efficiencies. Telematics, remote diagnostics, and predictive maintenance are becoming standard, allowing for real-time monitoring and optimization of equipment performance. This trend is driving the demand for advanced electronic components and software solutions tailored for off-highway applications.
   
• Hybrid electric vehicles (HEVs) are gaining traction in the off-highway sector as they offer a balance between electric propulsion and traditional internal combustion engines. This hybrid approach provides extended operational range and flexibility, making it suitable for applications where full electrification may not yet be feasible.
   
• Governments worldwide are implementing stricter emissions regulations and offering incentives to promote the adoption of electric vehicles. These policies are accelerating the transition from diesel-powered to electric off-highway machinery. As a result, manufacturers are increasingly investing in EV components to comply with environmental standards and capitalize on available subsidies.
   

Trump Administration Tariffs

• The Trump administration-imposed tariffs on various Chinese imports, including EV components such as batteries, electric motors, and control systems. As many off-highway EV parts were sourced from China, this led to increased procurement costs for OEMs and suppliers. These higher costs were either passed on to consumers or absorbed by manufacturers, squeezing margins and delaying electrification projects.
   
• Tariffs triggered supply chain uncertainties, compelling companies to reconsider their sourcing strategies. Firms began diversifying suppliers away from China to avoid tariff impacts, leading to increased logistical complexity and potential quality variations. This shift delayed some development timelines for EV components, particularly battery packs and inverters, affecting production schedules for off-highway electric equipment.
   
• Uncertainty around trade policy led to a cautious investment environment, particularly for U.S.-based companies evaluating new EV component lines. With unclear long-term tariff structures, some manufacturers deferred or scaled down capital expenditure on electrification projects. This slowed innovation and market penetration for off-highway EV components, particularly in sectors like construction and agriculture that rely on cost-effective equipment.
   

Off-highway EV Component Market Analysis

Based on applications, the off-highway EV component market is divided into material handling, earthmoving, harvesting, transport & hauling, and drilling & blasting. In 2024, the earthmoving segment dominated the market, accounting for around 37% share and is expected to grow at a CAGR of over 8.5% during the forecast period.
 

• The earthmoving segment holds the highest market share in the off-highway EV component market due to its extensive usage across construction, mining, and infrastructure projects, which demand high-powered and durable equipment like excavators, loaders, and bulldozers.
   
• Governments and private developers are increasingly adopting electric alternatives to meet sustainability goals, particularly in urban construction and tunneling where noise and pollution constraints are strict.
   
• Additionally, frequent duty cycles and predictable jobsite environments make earthmoving equipment ideal for electric adaptation. OEMs and component suppliers are actively targeting this segment with advanced drivetrains, battery packs, and thermal management systems, further accelerating electrification.
   
• For instance, in April 2025, Yanmar’s vision for electric construction equipment centers on smart electrification and overcoming charging challenges by introducing a self-propelled, autonomous EV battery-charging vehicle. This mobile charger is designed to automatically travel to off-highway electric equipment on-site, supply power as needed, and minimize operational downtime-especially important when machines cannot leave the site for charging.
   

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Based on propulsion, the off-highway EV component market is segmented into Battery electric vehicles (BEV), Plug-in hybrid electric vehicles (PHEV), Hybrid electric vehicles (HEV), and Fuel cell electric vehicles (FCEV). In 2024, the Battery electric vehicles (BEV) segment dominates the market with 66% of market share, and the segment is expected to grow at a CAGR of over 8% from 2025 to 2034.
 

• Battery Electric Vehicles (BEVs) hold the highest market share in the off-highway EV component market due to their zero-emission capability, lower operating costs, and increasing regulatory support for decarbonization. BEVs are well-suited for applications in construction, agriculture, and mining where equipment operates in confined or urban environments, making emissions and noise reduction critical.
   
• Additionally, BEVs have fewer moving parts compared to hybrid or ICE-powered equipment, reducing maintenance requirements and downtime. Government incentives, fleet electrification mandates, and rising fuel prices further drive their adoption.
   
• For instance, in March 2024, Daimler Truck North America (DTNA) launched a comprehensive Battery-Electric Vehicle (BEV) Dealer Certification Program aimed at preparing its Freightliner dealer network to support the growing adoption of electric trucks. The program is designed to ensure dealerships can deliver safe, high-quality customer experience for battery-electric vehicle buyers and operators.
   

Based on component, the off-highway EV component market is segmented into battery packs, electric motors, controllers, inverters, power electronics, thermal management systems, onboard chargers, electric power steering systems, and others, with the battery packs category expected to dominate due to their critical role in powering electric machinery across construction, agriculture, and mining applications.
 

• As the primary energy source, battery packs directly influence vehicle performance, runtime, and efficiency, making them a central focus for OEMs and operators. The high cost of batteries compared to other components like motors or inverters also contributes to their dominant market value.
   
• Technological advancements in lithium-ion and solid-state batteries—offering improved energy density, faster charging, and longer lifecycle—further reinforce their prominence.
   
• Moreover, the demand for high-capacity battery systems is growing as off-highway EVs require more power to perform heavy-duty tasks over extended periods. Government incentives and R&D investments in battery technology also bolster their share within the component ecosystem.
   

In 2024, the China region in Asia Pacific dominated the off-highway EV component market with around 46% market share in Asia Pacific and generated around USD 3.25 billion in revenue.
 

• China dominates the off-highway EV component market in the Asia Pacific region, driven by strong government incentives, emission control mandates, and rapid infrastructure development. The country benefits from a mature EV ecosystem, advanced battery manufacturing capabilities, and a large domestic base of construction and agricultural equipment manufacturers.
   
• Local demand is further propelled by smart city projects and green mining initiatives. Additionally, China’s focus on supply chain localization and innovation in battery chemistry and electric drivetrains strengthens its competitive advantage in this market.
   
• For instance, in December 2024, ZF officially opened its third e-mobility plant in China, located in Shenyang, which focuses on the production and sale of electric axle drives for new energy vehicles. This facility is part of ZF’s strategic expansion in the e-mobility sector and represents an investment of over RMB 1 billion (€130 million), employing around 900 workers.
   

The off-highway EV component market in Germany is expected to experience significant and promising growth from 2025 to 2034.
 

• Germany plays a pivotal role in the off-highway EV component market, driven by its advanced engineering ecosystem, strong OEM presence, and stringent environmental regulations. The country’s focus on decarbonizing industrial operations, especially in construction and agriculture, is fueling demand for electric powertrains, batteries, and control systems.
   
• Additionally, Germany’s leadership in automation and digital integration enhances innovation in component design and manufacturing, making it a key hub for both domestic consumption and export of high-performance off-highway EV components.
   
• For instance, in February 2025, Austria’s Kreisel Electric announced a strategic partnership with Germany’s CustomCells to co-develop advanced battery cell designs tailored for the off-highway sector, including construction and agricultural vehicles, as well as marine applications. The collaboration will focus on creating two distinct battery cell variants: one with extremely high energy density and another optimized for overall cost efficiency.
   

The off-highway EV component market in the U.S. is expected to experience significant and promising growth from 2025 to 2034.
 

• The U.S. off-highway EV component market is experiencing steady growth driven by increasing electrification in the agriculture, construction, and mining sectors. Federal and state-level incentives promoting clean energy and zero-emission equipment adoption are accelerating demand for EV components such as batteries, electric drivetrains, and power control units.
   
• Additionally, the growing focus on sustainability, operational cost reduction, and noise-free operations in urban construction zones is encouraging the shift toward electric off-highway machinery and boosting component sales across the country.
   
• For instance, in April 2025, Amsted Automotive expanded its U.S.-based manufacturing capacity and introduced new products specifically designed for the Off-highway EV Component (OHEV) market. This move aligns with the company's strategy to manufacture close to its customers, leveraging its 13 U.S. facilities to improve efficiency, reduce costs, and minimize tariff risks.
   

The off-highway EV component market in the UAE is expected to experience significant and promising growth from 2025 to 2034.
 

• The UAE off-highway EV component market is witnessing steady growth, driven by government-led sustainability initiatives such as the UAE Net Zero 2050 strategy and increased investments in green construction and mining projects. The region’s push toward smart infrastructure, supported by events like EXPO 2020 legacies and Vision 2030 goals.
   
• While current adoption is in early stages, demand for EV components like battery systems, electric axles, and controllers is rising, especially in Dubai and Abu Dhabi.
   
• For instance, in November 2024, the Ministry of Energy and Infrastructure (MoEI) of the UAE, in collaboration with the Federal Youth Authority, recently organized a discussion session titled ‘Youth Leadership in the Shift to Electric Vehicles’. Hosted by Rubu’ Qarn Science and Technology, the event focused on empowering Emirati youth to play a pivotal role in the country’s transition to electric vehicles (EVs).
   

Off-highway EV Component Market Share

• Top 7 companies of the off-highway EV component industry are Liebherr, Caterpillar, Komatsu, Volvo AB, Deere & Company, Kubota, and Hitachi Construction Machinery around 17% of the market in 2024.
   
• Liebherr focuses on developing modular electric drivetrains and battery packs tailored for off-highway machinery. The company leverages in-house component manufacturing to integrate electric motors, power electronics, and energy storage systems. Liebherr emphasizes partnerships with OEMs to expand electric component applications across mining and construction equipment, while also investing in R&D to enhance energy efficiency and operational performance in harsh working environments.
   
• Caterpillar is advancing its off-highway EV component strategy through the development of electrified powertrains, high-capacity batteries, and scalable charging solutions. It integrates electric components into prototype and production models, particularly in mining and compact construction equipment. The company emphasizes backward compatibility and system modularity, aiming to support hybrid transitions while investing in field validation and pilot programs to fine-tune durability and performance in rugged terrain.
   
• Komatsu is investing in battery-electric and hybrid drivetrains for off-highway applications, especially within mining and construction. It focuses on proprietary battery systems, regenerative braking, and integrated electric control units to optimize efficiency. Collaborating with battery and component suppliers, Komatsu emphasizes a systems-level approach, integrating electric components with digital solutions to improve machine lifecycle management, energy consumption, and remote diagnostics capabilities in electrified fleets.
   

Off-highway EV Component Market Companies

Major players operating in the off-highway EV component industry are:

• Caterpillar
• Deere & Company
• Hitachi Construction Machinery
• Komatsu
• Kubota
• Liebherr
• Sona Comstar
• Tata AutoComp
• Tata Elxsi
• Volvo AB
   

Most companies in the off-highway EV component market focus on strategic collaborations, modular product design, and regional customization to meet diverse application needs. They emphasize R&D for high-efficiency batteries, compact electric drivetrains, and integrated control systems. Additionally, firms pursue backwards integration and digitalization to optimize manufacturing and reduce costs, while aligning with regulatory trends and sustainability goals to gain a competitive edge in emerging electrified machinery markets.
 

Companies are also prioritizing scalable platforms to support both hybrid and fully electric configurations across equipment types. They are investing in localized production and supply chains to mitigate risks and meet country-specific regulations. Furthermore, emphasis is placed on developing robust thermal management and high-torque solutions tailored for heavy-duty use, while leveraging data analytics and telematics integration to enhance component performance, diagnostics, and lifecycle value in off-highway applications.
 

Off-highway EV Component Industry News

• In April 2025, Liebherr unveiled a new permanent magnet electric motor designed for off-highway equipment, offering the same power density as traditional hydraulic motors but with significantly higher efficiency 94–96% versus about 50% for hydraulics. The oil-cooled motor eliminates the need for hydraulic hoses and components, reducing machine weight, simplifying installation, and lowering maintenance needs. The design also improves operational reliability and mean time between failures due to fewer gears and components.
   
• In March 2025, Amsted Automotive announced new products and expanded capacity for off-highway electric vehicle (OHEV) manufacturers in the US. Key offerings include the Amsted eAxle Disconnect, which enables seamless switching between two- and four-wheel drive in EVs and hybrids, increasing driving range by up to 10% through ultra-efficient Dynamic Controllable Clutch (DCC) technology. These innovations are manufactured in Amsted’s US facilities and support the growing electrification needs of agricultural, construction, and other off-highway equipment sectors.
   
• In February 2025, Carlyle acquired controlling stakes in Roop Automotives and Highway Industries, combining them to form a diversified global auto parts platform. Both companies are leading manufacturers of forged and precision-machined components, steering assemblies, and powertrain parts for electric, hybrid, and internal combustion engine vehicles. The new platform boasts over 1,500 products, 55 global clients across 17 countries, and a significant manufacturing and warehousing footprint.
   
• In October 2023, Equipmake, a UK-based electrification specialist, partnered with Perkins, a subsidiary of Caterpillar Inc., to develop advanced e-powertrain systems for off-highway hybrid vehicles. The collaboration, supported by £11.14 million in UK government funding through the Advanced Propulsion Centre (APC)-with £3.24 million allocated to Equipmake-aims to accelerate the decarbonization of the global off-highway market. The hybrid system will feature a bespoke, high torque density electric motor and inverter, with all power electronics designed and developed in-house by Equipmake.
   

The off-highway EV component market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue ($ Mn/Bn) and shipment (Units) from 2021 to 2034, for the following segments:

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Market, By Component

• Battery packs
• Electric motors
• Controllers
• Inverters
• Power electronics
• Thermal management systems
• Onboard chargers
• Electric power steering systems
• Others

Market, By Propulsion

• Battery electric vehicles (BEV)
• Plug-in hybrid electric vehicles (PHEV)
• Hybrid electric vehicles (HEV)
• Fuel cell electric vehicles (FCEV)

Market, By Application

• Material handling
• Earthmoving
• Harvesting
• Transport & hauling
• Drilling & blasting

Market, By Vehicle

• Electric construction vehicles
  • Excavators
  • Bulldozers
  • Loaders
• Electric agricultural vehicles
  • Tractors
  • Harvesters
  • Sprayers
• Electric mining vehicles
  • Haul trucks
  • Drills
• Others

Market, By Sales Channel

• Original Equipment Manufacturers (OEM)
• Aftermarket

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Russia
  • Nordics
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • ANZ
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
  • Argentina
• MEA
  • UAE
  • Saudi Arabia
  • South Africa