The automobile industry is regarded as one of the primary producers of greenhouse gas emissions. Hence, one major approach for promoting global sustainability is vehicle electrification. Energy source hybridization is imperative in vehicle electrification because no alternative clean energy source can match the performance of vehicles with internal combustion engines. For a compact energy source system with minimal source degradation and low operational costs, it is crucial to determine the optimal sizing of multiple sources in a hybrid electric vehicle (HEV). The objective of this article is to conduct a thorough assessment of the optimal energy source sizing methodology for HEV alongside an analysis of energy management systems. The importance of dynamic energy source characteristics in the optimal source design is explained and the dynamic modelling of these sources is investigated in detail. Moreover, this paper discusses the dynamic source degradation models used in the literature. This analysis on HEV component sizing provides a comprehensive picture of the current state-of-the-art and highlights several shortcomings, difficulties, and knowledge gaps. The findings indicate that the establishment of an energy management system and energy source sizing are interdependent activities that can prolong the usable life of the energy sources and reduce energy consumption. The aging, temperature, depth of discharge, and charging state are found to be essential characteristics of vehicle energy sources, yet these dynamic aspects have largely been neglected in previous papers. Additionally, if the source deterioration and associated factors are considered throughout the design phase, the HEV system can be built with long-life characteristics. The assessment conclusions highlight the significance of continued analysis to overcome obstacles and improve the hybrid automobile sector.