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The automotive industry is on the cusp of a transformative decade, according to a recent report by MarketsandMarkets. The study forecasts that the global automotive market, encompassing passenger vehicles, light commercial vehicles, and medium and heavy commercial vehicles, will expand from 88 million units in 2024 to a substantial 104 million units by 2030. This growth trajectory represents a compound annual growth rate (CAGR) of 2.4%, signalling a period of significant expansion and innovation in the sector.

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Several key factors are driving this growth, with the adoption of electric vehicles (EVs) leading the charge. The development and manufacturing of long-range batteries, coupled with the installation of fast and ultra-fast charging infrastructure, are accelerating the transition to electric mobility. Additionally, the introduction of autonomous vehicles, the deployment of 5G connectivity, and evolving trends in shared mobility are reshaping the automotive landscape.

Autonomous vehicles are expected to play a crucial role in this growth story. The report highlights that numerous original equipment manufacturers (OEMs) are introducing Level 2 (L2) and Level 3 (L3) autonomous vehicles. Companies like Nissan, Honda, Audi, BMW, and Mercedes-Benz are at the forefront of this technological revolution. BMW and Mercedes have already received approval for L3 autonomous vehicles in Germany and the US, respectively, with BMW also gaining permission to test its L3 vehicles in Shanghai, China.

The market for L3 autonomous vehicles is projected to grow at an impressive CAGR of 86.5% between 2023 and 2030. While Level 4 (L4) autonomous vehicles are expected to see limited commercial growth, primarily in select markets, the overall trend towards higher levels of automation is clear.

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Geographically, the Asia Pacific region is poised to dominate the automotive market during the forecast period. China, in particular, stands out as a powerhouse in the industry, leading in vehicle sales, production, and EV battery manufacturing. In 2023, China's passenger vehicle sales exceeded 25 million units, accounting for around 50% of global sales. The country's robust supply chain for EV batteries, with over 50% of global production and around 75% of component manufacturing, further cements its position as a key player in the future of automotive.

The report also identifies key market dynamics shaping the industry's future. Drivers include the consistent growth of the EV segment over traditional internal combustion engine (ICE) vehicles. However, the industry remains highly dependent on global economic factors, posing a potential restraint. Opportunities lie in the growing adoption of connected vehicles, while challenges persist in the form of limited EV range and charging times.

Leading players in this evolving landscape include Toyota Motors Corporation, Tesla, Volkswagen AG, Ford, BYD, and Hyundai Motor Corporation. These companies are actively innovating and expanding their offerings to meet changing market demands.

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Recent developments in the industry underscore its dynamic nature. Honda began production of its 2025 CR-V e:FCEV fuel cell electric vehicle in Ohio, USA, in June 2024. BYD launched its upgraded e-Platform 3.0 Evo for BEV models in May 2024, with the Sea Lion 07 EV SUV set to be the first model based on this platform. In the same month, Exicom, an Indian EV charger and power solution provider, introduced its Harmony Gen 1.5 DC fast charger.

The MarketsandMarkets report offers valuable insights for market leaders and new entrants alike, providing a comprehensive understanding of the competitive landscape, key market drivers, challenges, and opportunities. It analyses critical trends from 2023 to 2030, including electrification, the rise of 5G, connected cars, and smart manufacturing.