BCG: A 50% Market Share by Alternative Proteins Could Equal Removing Half of Gas Cars

A new report jointly published by Boston Consulting Group (BCG), The Good Food Institute (GFI), and Synthesis Capital examines the lessons the alternative protein industry can learn from the rapid evolution of electric vehicles (EVs). The report underscores significant parallels between these two sectors, both keyt in addressing global greenhouse gas emissions and transforming traditional industries.

Alternative proteins, including plant-based and cultivated meat products, hold promise as sustainable alternatives to conventional animal agriculture, which currently contributes between 15% to 20% of global greenhouse gas emissions—exceeding those from passenger vehicles. The report highlights that if alternative proteins were to capture half of the global protein market, including dairy, they could potentially mitigate 5 gigatons of CO2 equivalents annually, akin to removing 50% of gas-fueled cars from the roads.

Despite this potential, the alternative protein industry faces substantial challenges in achieving widespread adoption. While electric vehicles surged from less than 0.2% of total new car sales in 2012 to 18% in 2023, plant-based meats have struggled to capture more than 1% of total meat dollar sales in US retail over the past five years.

A critical disparity lies in governmental support and private investment. EVs globally benefited from approximately $40 billion in direct purchase subsidies, whereas the alternative protein industry received only $635 million in government support in 2022. This stark contrast in financial backing inhibits innovation, scale-up, and competitiveness against traditional meat products.

The report calls for increased regulatory backing to propel the alternative protein industry forward. Initiatives in countries such as the US, Denmark, Israel, Singapore, and South Korea to establish policy frameworks for cultivated and fermentation-derived proteins indicate initial regulatory support. However, sustained and enhanced support is essential to realize the industry’s full economic, environmental, and food security benefits.

Elfrun von Koeller, a BCG partner and report coauthor, emphasizes the necessity for collaborative efforts among private companies, governments, and investors to build a resilient and sustainable food system. Drawing lessons from the EV sector’s trajectory, she advocates for strategic investments and policy frameworks that facilitate consumer adoption by addressing taste, price, and accessibility challenges.

Emma Ignaszewski from the Good Food Institute underscores that, similar to EVs offering a straightforward transition to sustainable transportation, alternative proteins promise a comparable shift in the food sector without significant behavioral changes. Securing public funding—crucial for EV innovation—is identified as pivotal for alternative proteins to achieve cost competitiveness and appeal to consumer preferences.

Rosie Wardle, co-founder of Synthesis Capital, highlights the growing momentum in governmental recognition of alternative proteins’ potential to fulfill climate commitments, ensure food security, and stimulate economic growth. However, sustained support is imperative for the industry to transition from its ‘alternative’ status to mainstream adoption.

The report urges stakeholders to leverage successful strategies from the EV industry—innovation, supportive policies, and substantial investment—to accelerate the adoption of alternative proteins. By doing so, they can catalyze a transformative shift towards a sustainable and secure global food system.