Driving Towards Purpose Built Vehicles: Industry Overview and Advancements

Purpose-built vehicles (PVBs) are designed and constructed for specific tasks or functions, tailored to meet the unique requirements of a particular job or activity. Public reactions to purpose-built vehicles vary, influenced by factors such as functionality, innovation, environmental considerations, aesthetics, and accessibility. For instance, a fire truck is purpose-built for firefighting, with features such as water tanks, hoses, and specialized equipment designed specifically for that task. Similarly, an ambulance is purpose-built for transporting patients, with features including medical equipment, stretcher systems, and emergency lighting. These vehicles are optimized for their intended purpose, resulting in increased efficiency and effectiveness in performing their designated tasks.

Industry Overview and Advancements

The purpose-built vehicle market is expected to grow at a significant CAGR of 6.1% by 2030. Companies are focusing on product research, innovations, and technology adoption to propel this growth. Additionally, OEM (Original Equipment Manufacturers) designs new vehicles based?on ride-sharing firm contracts. Benefit from, sales of electric purpose-built vehicles will make it much easier for OEMs to meet CO2 emission targets for?their?fleets. The market requirements are evolving, with companies such as ‘Uber’ in the United States and ‘Didi Chuxing’ in China seeking vehicles that can enhance the passenger experience and offer flexibility at competitive prices. New purpose-built vehicles are being designed for mobility to meet this demand. Companies such as German start-ups Street Scooter, e.Go, and MOIA is among the first to offer vehicles tailored to these requirements.

For instance, the new public-built vehicles plant will be built as an eco-friendly plant that applies future innovative manufacturing technologies while minimizing carbon emissions. It will also seek efficiency and intelligence with Hyundai Motor and Kia's smart factory brand 'E-FOREST technologies' such as digital manufacturing systems. The Kia Concept PV5 is Kia's first dedicated purpose-built vehicle set to be released in 2025. Customers can choose a configuration that suits their needs and preferences, based on three body types, namely, basic (passenger), van (delivery), and chassis cab. Kia also plans to develop a PV5-R model using autonomous driving technology.

The Kia Concept PV7 is Kia's second PBV and the largest cargo space in the lineup. Kia PV7 will be optimized for the customers’ businesses, incorporating advanced software-based solutions and services. The Kia Concept PV1 is Kia's small purpose-built vehicle planned to be developed to respond to mobility needs due to the spread of ultra-urbanization, e-commerce, and the gig economy. It reflects the needs of customers who want to freely select various vehicle sizes within a single brand according to their business needs.

The major market players are contributing significantly towards market growth, by implementing various business strategies such as partnerships, mergers or acquisitions, and more. Several conventional automotive OEMs (Original Equipment Manufacturers), such as Hyundai, Kia, Ford, and Renault also seek business opportunities, converting their existing vehicle models?into?PBVs. For instance, in May 2023, KIA Corp. and Kakao Mobility signed a memorandum of understanding to establish a ride-hailing business model for advanced mobility services. Kia to develop dedicated PBV models reflecting the needs of software service proposals provided by Kakao Mobility, planned to?launch?in?2025.

In September 2023, Phoenix Motorcars entered the electric school bus market with an order for 10 zero-emission buses from the District of Columbia. The Phoenix vehicles can be fully charged in less than two hours with a 100-kW Level III charger. The school buses, compared to their equivalent fossil-fueled alternatives, can reduce atmospheric emissions by approximately 79 tons per vehicle?annually. Secondly, in September 2023, Hyundai Motor eyes PVB market entry. Hyundai showcased a PBV test car for airport passenger pickups to be manufactured?by?Kia.

Additionally, Tesla's strategy involves the development of purpose-built vehicles. This will include high-profile launches such as the Cyber truck and the Roadster 2.0, which is touted to be the fastest-accelerating production car ever made.

Challenges in the Anticipated Market Growth

?Shared vehicles have changed over the years to include more than just cars. Shared scooters and bikes are commonly found on streets of all sizes. The full-sized counterpart’s micro-parts are typically under 500 kg and have a maximum two-passenger capacity. The lighter footprints of microcars would be electrically powered and another option would be a sustainable market development. Fast cards that reflect the microcar today are the BMW Isetta. After World War II the BMW Isetta was the complete car that people could buy if they could not afford BMWs’ more premium cars. Fast forward to the BMW is set as a phonic design that has inspired the look of current microcars as the Microlino from Switzerland. For instance, the future of microcars is pod cars. Futurists see pod cars as being autonomous vehicles that provide point-to-point transportation for two to ten people, with ample room inside for passengers to relax and enjoy the comforts?of?the?ride.

Additionally, the auto industry has expanded its manufacturing capacity as automakers require chips with higher computing power. The demand for semiconductors has surged due to trends like the growth of autonomous vehicles, increased connectivity, and the rise of autonomous driving technologies. Several factors have combined to create the semiconductor shortage.

In a nutshell, the PBV market is growing, driven by technological advancements and changing consumer needs. The growing investments from major automotive manufacturers in the industry are poised with substantial growth in the electric vehicles segment. Innovations in autonomous driving, smart manufacturing, and sustainable practices are shaping the future generation of PVBs. It enhances the efficiency and the environmental impacts. However, challenges such as the shortage of semiconductors and the growing need for sustainable solutions in shared vehicles must be addressed to ensure the expansion and success of the market.

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