Electric Motor Market Set to Triple by 2032

The machinery that powers the modern world, from industrial assembly lines to the cooling systems of data centers, is undergoing a massive, capital-intensive overhaul.

According to a new analysis by Allied Market Research, the global electric motor market is projected to reach $373.9 billion by 2032, nearly tripling its 2020 valuation of $142.1 billion.

The data reveals a Compound Annual Growth Rate (CAGR) of 9.5% from 2023 to 2032. But beyond the growth percentages, the report outlines a structural change in how the global economy consumes energy.

As nations and corporations pledge “efficiency” and “decarbonization,” the burden of delivering those promises falls on the hardware. The result is a forced retirement of legacy infrastructure and a surge in demand for premium, high-efficiency motor systems.

For decades, the industrial motor has been a static component of the global grid. Today, it is a focal point of regulatory pressure.

The International Energy Agency (IEA) estimates that electric motor systems account for approximately 53% of global electricity use. As governments in the European Union and North America tighten Minimum Energy Performance Standards (MEPS), the industrial sector is being forced to upgrade.

The report highlights that the “prime determinants of growth” are not merely organic demand, but a systemic push for energy efficiency. The market is witnessing a replacement cycle where aging induction motors are swapped for advanced systems capable of meeting Net Zero targets.

This is not a cheap transition. The analysis notes that the “high initial cost” of these advanced motors remains a primary restraint on the market. Efficiency lowers operating costs over decades, but it demands significant upfront capital—a dynamic that favors large industrial incumbents over smaller players.

The most aggressive growth vector identified in the report is the automobile-traction motor segment.

Projected to grow at a CAGR of 14.8% through 2032, this segment represents the physical dismantling of the internal combustion engine economy.

As automakers pivot to electric vehicles (EVs), the demand for traction motors is reshaping the supply chain for copper, rare earth magnets, and steel laminations.

This shift is more than a consumer trend; it is an industrial imperative to “safeguard the environment by reducing carbon emissions,” according to the report. The traction motor is becoming the new engine block, driving a wedge between the automotive industry and its traditional fossil-fuel reliability.

The report breaks down the market into two distinct technological architectures, each serving a different function in the modern state.

• Alternate Current (AC) Motors: These remain the workhorses of the grid. Accounting for three-fourths of the market share in 2020, AC motors dominate the heavy industrial landscape. They are utilized in substations and generating stations—critical infrastructure connected directly to the bus bars that stabilize power factors across the electrical network.

• Direct Current (DC) Motors: While smaller in volume, this segment is forecast to grow at 9.9% annually. These motors are the precision instruments of the economy, mechanically commutated and essential for high-speed applications in robotics and medical equipment. As the healthcare and automation sectors expand, their reliance on these specialized motors deepens.

The geography of this boom confirms where the world’s industrial capacity truly resides.

Asia-Pacific dominated the market in 2022, accounting for more than 40% of global revenue. The region’s control is anchored by the massive manufacturing sectors of China and India, along with agricultural and pharmaceutical industries that rely heavily on motor-driven pumps, compressors, and fans.

However, the fastest growth is emerging elsewhere. The LAMEA region (Latin America, Middle East, and Africa) is projected to witness a CAGR of 10.6%. Rapid urbanization in nations like Brazil and Argentina is driving demand for consumer appliances and home electronics, expanding the grid’s load in the global south.

The surge in electric motor valuation serves as a barometer for the wider energy transition. The “electrification of everything” requires more than just software code or policy papers; it requires millions of tons of copper and steel, wound into the machines that actually do the work.

As the data makes clear, the transition to a greener economy is expensive, resource-intensive, and mechanically complex. The green arrows on the stock charts may measure sentiment, but the backlog for electric motors measures the actual build-out of the future infrastructure.

By Michael Kern for Oilprice.com

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