Automobile Market

The global Automobile Market is valued at USD 2810 Billion in 2023 and is projected to reach a value of USD 4006 Billion by 2032 at a CAGR (Compound Annual Growth Rate) of 4.1% between 2024 and 2032.

Key Highlights of Automobile Market

• The Asia Pacific region led the Automobile market in 2023, with 54.5% of the total market share,
• In 2023, the Passenger Vehicles segment took the lead in the market, contributing 73.2% of considerable revenue share,
• Based on Propulsion Type, the Internal Combustion Engine Vehicle segment significantly contributed to the market’s expansion in 2023,

Automobile Market: Regional Overview

• The Asia Pacific Automobile market exhibited significant dominance in 2023, with 54.5% of revenue share.
• The Asia Pacific region's robust growth in the Automobile market is underscored by China's dominant share of 56%, while India contributes a substantial 12%. Asia Pacific region is home to some of the world's biggest and most powerful car manufacturers. In countries such as China, India, Japan and South Korea there are substantial vehicle production facilities that attract investors from abroad.
• Currently, China is the world's largest producer and distributor of all types of vehicles, including electric vehicles or internal combustion engines. Chinese Automobile manufacturers are increasingly targeting the markets of developed countries to further expand their global presence.
• A large supply of raw materials essential for the production of cars is available to Asian countries. Moreover, in the case of affordable and luxury cars they have access to a highly qualified workforce as well as an increasingly developed national market. Market growth in the region is likely to be further stimulated by increased regional investment in public transport infrastructure.

Automobile Market: Type Overview

• In 2023, the Passenger Vehicles segment dominated the Global Automobile market with 73.2% of revenue share.
• The increasing income of the middle class and a substantial youth population are driving robust demand for passenger vehicles. Such demographic shifts are creating a larger market of consumers who can afford and prioritize personal vehicles for their transportation needs.
• Due to their broad appeal, serving families and individuals alike, passenger cars are dominant in the market. Because of their adaptability to the needs of daily commuting and private transport, they are a necessity for households all over the world. The continuous demand for passenger cars is ensured by this broad utility.
• The passenger vehicle segment benefits from frequent consumer preference for new models with advanced features and technology. This leads to shorter replacement cycles compared to commercial vehicles. Significant innovation, particularly in the electric vehicle (EV) sector, is also propelling the segmental growth. Automakers are focusing on EV models to meet regulatory requirements and address environmental concerns, keeping passenger vehicles at the forefront of industry advancements.

Key Trends

1. The adoption of EVs in the Automobile industry is still on the rise. The automotive industry is expanding its EV portfolio and governments around the world are offering incentives to buy electric vehicles. EVs are expected to increase their market share significantly by 2025, catching up with the price of internal combustion engine vehicles.
2. The use of Internet of Things (IoT) technology is converting Automobile into intelligent, networked systems. In order to enhance user experience and collect important data on safety enhancements and preventive maintenance, the automotive sector has adopted connectivity in various forms, e.g. infotainment systems and real time diagnostics.
3. With Level 3 & Level 4 autonomous vehicles starting the testing and deployment phases, autonomous driving technology is developing quickly. Tesla, Waymo and traditional auto manufacturers are among the companies investing heavily in self drive capabilities. This raises concerns about safety regulations and standards.
4. The sector is increasingly concerned about sustainability. Sustainable materials and recycling are increasingly being used in the production of cars by auto manufacturers. Businesses such as Tesla and Toyota are also looking for renewable energy sources to reduce their carbon footprint, in the manufacturing facilities.
5. Mobility-as-a-Service, which enables users to pay for the use of transport solutions, is becoming increasingly popular. By replacing traditional cars with alternative forms of transport that impact infrastructure development and urban planning, ridesharing, car sharing or subscription services have changed the face of public transport in cities.

Automobile Market - Government Initiatives

• India’s Automotive Mission Plan 2016-26: This collaborative initiative between the Indian government and the automotive industry outlines a development roadmap. The FAME Scheme, supporting electric mobility, has been extended until March 31, 2024.
• India’s EV Market Growth: India is projected to become the largest EV market by 2030, with an investment potential exceeding US$ 200 billion over the next 8-10 years. The sector has attracted about US$ 35.65 billion in cumulative FDI from April 2000 to December 2023.
• Production-Linked Incentive (PLI) Scheme in India: Announced by the Union Cabinet, the PLI Scheme offers financial incentives of up to 18% to boost domestic manufacturing of advanced automotive technology products. With an outlay of $3.5 billion, it aims to attract investments in the automotive manufacturing value chain.
• Extension of PLI Scheme in India: The Ministry of Heavy Industries extended the PLI Scheme for Automobile and Auto Components by one year, making incentives applicable for five consecutive financial years starting from 2023-24.
• China’s Renewed EV Subsidies: To combat slow growth and stimulate the EV market, China renewed its EV subsidies and tax reduction policies in the first half of 2023, despite plans to end them in 2022.
• China’s Major Tax Incentive Package: In June 2023, China announced a 520 billion yuan (US$72.3 billion) tax incentive package over four years, the largest ever for the automotive industry, to support EVs and environmentally friendly vehicles.
• Tax Exemptions for New Energy Vehicles (NEVs) in China: From January 1, 2023, to December 31, 2023, purchases of NEVs included in the official list are exempt from vehicle purchase tax, continuing support for green vehicle adoption.
• France’s Commitment to Clean Vehicles: President Macron aims to make France Europe's top producer of clean vehicles, targeting over one million electric and hybrid cars annually within five years. An €8 billion rescue plan includes individual grants and bonuses to promote green vehicle purchases.
• Brazil’s Financial Support for Auto Businesses: Brazil introduced payment suspensions and transferred €3.4 billion from the PIS-PASEP Fund to support businesses, alongside €853 million in credit expansion for micro, small, and medium-sized companies.
• Germany’s VAT Reduction and Green Vehicle Incentives: Germany reduced VAT from 19% to 16% for 2020 and increased purchase bonuses for green vehicles priced up to €40,000. Buyers now receive a €6,000 bonus, up from €3,000, and the ten-year tax exemption for fully electric cars is extended until 2030.
• EU’s Circular Automotive Sector Proposal: The EU Commission proposed measures to enhance the circularity of the automotive sector, including design, production, and end-of-life vehicle treatment. Expected outcomes include €1.8 billion in net revenue by 2035, job creation, and better road safety by preventing the export of non-roadworthy vehicles.
• Future Discussions on Vehicle Taxation in Germany: Germany is considering adjusting vehicle taxes based on environmental impact starting in 2023, further incentivizing green vehicle ownership and contributing to climate goals.

Premium Insights

Sustainable transportation and the continuous transition towards electric cars (EVs) are the main forces behind the global Automobile business. The International Energy Agency published data showing a 41% increase in electric vehicle sales by 2020, which indicates that customers are becoming more and more aware of the benefits of environmentally friendly solutions. The uptake of energy vehicles has a significant impact on government policies and incentives promoting greener & cleaner modes of transport. In addition, new developments in connectivity & autonomous driving are changing the way people will move around in the future and improving driving pleasure, safety, and convenience. There is a growing trend of cooperation between established automakers and digital giants, indicating the significance of innovation and digitization in this sector.

‹›

Report Coverage & Deliverables

PDF report & online dashboard will help you understand:

• Real-Time Data Updates:
• Competitor Benchmarking
• Market Trends Heatmap
• Custom Research Queries
• Market Sentiment Analysis
• Demographic and Geographic Insights

Book Demo

Get Access Now

Track market trends LIVE & outsmart rivals with our Premium Data Intel Tool: Vantage Point

Market Dynamics

• The global Automobile market is set to grow due to increased focus and investment in public transport, particularly in heavy duty and long range buses. The need for reducing traffic congestion resulting from the proliferation of personal vehicles is at the heart of this transition. In order to meet today's consumer needs, governments are under pressure to modernize their current transport systems and address issues such as bad bus conditions, inadequate connectivity or a shortage of seats in order to increase the attractiveness of mass transit while reducing reliance on private cars.
• Emerging economies with growing middle-income populations, such as India, China, and Africa, are being targeted by car manufacturers and suppliers. To meet increasing demand, top companies are introducing the segment of cheaper cars and motorcycles. They are building new production facilities to comply with local regulations and improve the service of local markets in these regions by taking advantage of changes in buying patterns.
• The automotive sector, which ranges from small passenger cars to much larger buses & trucks, is experiencing strong growth due to the demand for electric vehicles. Increased awareness of the environment, rising fuel costs and the growing number of electric vehicle providers have stimulated consumer interest in sustainable transport options. With the entry of more players in the market, electric vehicles have been able to reach wider audiences thanks to lower costs.

Competitive Landscape

• The market's competitive environment is defined by fierce rivalry amongst the leading players. Well known automakers like Toyota, Volkswagen, and General Motors fight for market dominance by providing a wide variety of Automobile, including electric and driverless models.
• Tech firms like Waymo and Tesla are upending conventional wisdom by using cutting-edge mobility strategies. Furthermore, Chinese automakers are growing quickly abroad, including BYD and NIO.
• Rivian and Lucid Motors, two startups in the electric and autonomous vehicle field, are posing a threat to established players. Technological developments and the industry's growing emphasis on sustainability and connection are the driving forces behind this intense rivalry.

Recent Market Developments

PSA Singapore Extends Joint Venture Partnership for Asia Automobile Terminal Singapore (AATS)

• In May 2024, PSA Singapore, along with Nippon Yusen Kabushiki Kaisha (NYK) and “K” Line, extended their joint venture partnership for the Asia Automobile Terminal Singapore (AATS) for another 12 years. This renewal aims to address the increasing demand for automotive transhipment capacity and connectivity. AATS, capable of handling 1 million vehicles annually, is the largest transhipment hub for finished vehicles in Southeast Asia. It features two specialised deepwater Roll-on/Roll-off (RoRo) berths and a Multi-level Automotive Yard at PSA Singapore’s Pasir Panjang Terminal.

Nissan Announces Investment Agreement with Kasai Kogyo

• In May 2024, Nissan Motor Co., Ltd. (Nissan) announced an investment agreement with Kasai Kogyo Co., Ltd. (Kasai Kogyo), wherein Nissan will acquire newly issued Class A preferred shares of Kasai Kogyo worth 6 billion yen. This acquisition is contingent upon approval at Kasai Kogyo’s general shareholders meeting, completion of regulatory approvals, and other necessary processes.

Honda Plans Comprehensive EV Value Chain in Canada

• In April 2024, Honda Motor Co., Ltd. announced plans to establish a comprehensive EV value chain in Canada with an investment of approximately CAD$15 billion (USD$11 billion), including contributions from joint venture partners. This investment aims to bolster Honda’s EV supply system and prepare for increased EV demand in North America. Honda is evaluating the requirements for constructing a new, environmentally responsible EV plant and a standalone EV battery plant in Alliston, Ontario.

General Motors Invests in Arlington Assembly Plant for Future ICE Full-Size SUVs

• In June 2023, General Motors Co. announced an investment of over $500 million in its Arlington Assembly plant to prepare for the production of future internal combustion engine (ICE) full-size SUVs. This investment, pending successful discussions with local government officials, aims to strengthen GM's leadership in the full-size SUV market.

The global Automobile market can be categorized as Type, Application, and Region.