Automotive Market Intelligence Report, Key Trends, Innovations and Market Dynamics

Automotive Market Evolution Growth, Challenges and Opportunities

The automotive market is anticipated to grow from USD 4543.97 billion in 2025 to USD 7458.15 billion by 2034, with a compound annual growth rate (CAGR) of 5.66% during the forecast period from 2025 to 2034.

Introduction

The automotive market deals in manufacturing and distribution of automotive across the globe. There are several types of passenger vehicles developed in this sector consisting of sedans, hatchback, SUVs and MUVs. Also, numerous types of commercial vehicles are manufactured in this industry comprising of LCVs, heavy trucks, buses and coaches. The growing sales of passenger cars along with rapid investments in EV industry has fostered the industrial expansion. This market is evolving rapidly with the growth of the electric vehicles industry around the world.

• According to the OICA, around 58644601 passenger vehicles were sold globally in 2022 that increased to 65272367 in 2023.

Highlights of the Automotive Market

• Asia Pacific held the largest share of the automotive market due to the rising sales of commercial vehicles in this region.
• North America is expected to grow with the highest CAGR due to the growing demand for electric vehicles in this region.

Key Metrics and Overview

Automotive: Stats and Figures

• According to the International Organization of Motor Vehicle Manufacturers, around 92724668 vehicles were sold globally in 2023.
• According to the India Brand Equity Foundation, around 2773039 vehicles were manufactured in India during September 2024.
• According to the International Energy Agency, around 1.7 million electric vehicles were sold in the U.S. during 2024.
• According to the U.S. Energy Information Administration, around 8.6% of the light-duty vehicles sold in the U.S. during 1st quarter of 2024 were hybrid vehicles.

Industry Leader Announcement

In February 2025, Andreas Lehe, the Bentley’s Member of the Board for Manufacturing, “The Excellence Centre for Quality & Launch is a key building block for the successful delivery of the Beyond100+ strategy. The facility represents a significant step forward in transforming our historic Crewe site into a world-leading hub for sustainable luxury automotive production, The new facility will be a collaborative workspace for both Quality & Launch teams and will play a crucial role in upholding the unparalleled quality, precision, and craftsmanship that defines Bentley, as we deliver our first fully electric vehicle.”

Segmental Outlook

The passenger car segment held a dominant share of the market due to the increasing demand for SUVs around the world. Also, the growing demand for hybrid vehicles along with the presence of various automotive manufacturers in Asia Pacific has boosted the industrial expansion. Moreover, the rising sales of luxury vehicles coupled with rapid investment in EV sector has propelled the market expansion.

The ICE vehicle segment led the industry due to the upsurge in demand for diesel powered vehicles in hilly areas. Moreover, the growing demand for gasoline vehicles in Europe and North America has fostered the industrial expansion. Additionally, the rising consumer preference for luxury vehicles in developed nations is driving the industry in a positive direction.

Driving Factors

• Investment in Public Transport: There is a growing demand for large vehicles, such as large cars and long-distance buses, driven by increased investment in public transport. Local governments are under pressure to revamp existing transportation systems to meet the evolving needs of users and alleviate road congestion caused by private vehicles. Companies like UBS Univers Busservice GmbH and MarinoBus are introducing longer buses equipped with driver assistance and LED lighting to cater to long-distance travel needs.
• Demand in Emerging Markets: Automotive companies are capitalizing on the rising demand for affordable private cars in developing countries like India, China, and Africa. With the middle-income group expanding in these regions, companies are introducing affordable new cars and motorcycles. For instance, Maruti Suzuki introduced the Fronx SUV in the South African market, targeting affordability and regional preferences.

Geographical Insights

Asia Pacific held the highest share of automotive market. The rise in number of automotive manufacturers along with rapid investment in automobile industry has boosted the industrial expansion. Also, the growing development in the EV industry coupled with availability of raw materials is projected to propel the market growth. Moreover, the presence of skilled labor force as well as rising disposable income of the people is accelerating the industry in a positive direction.

• In March 2025, Tata Motors collaborated with DIMO. This collaboration is done for launching a new range of passenger vehicles in Sri Lanka.

North America is expected to grow with a significant CAGR during the forecast period. The market in this region is driven by the rising demand for hybrid vehicles along with technological advancements in automotive sector. Moreover, the presence of several automotive companies such as Tesla, Ford, Chevrolet, Rivian and some others has boosted the industrial expansion. Additionally, the growing consumer preference for luxury cars in Canada and the U.S. is driving the market growth.

• In September 2024, Lotus launched a new ultra-luxury variant of its electric hyper-SUV Eletre, Eletre Carbon in North America. This car is designed for the driving enthusiasts consumer of the U.S. and Canada.

Competitive Landscape

The automotive market is a highly fragmented industry with the presence of several dominating players. Some of the crucial players in this industry consists of Tesla Inc, Toyota Motor Corporation, Nissan Motor Co Ltd, Fiat S.P.A, Volkswagen AG, Mercedes-Benz Group AG, Ford Motor Company, BYD Company Ltd, and some others. These companies are constantly engaged in developing automotives and adopting numerous strategies to maintain their dominant position in this industry.

• According to the annual report of Tesla, the revenue of the automotive segment in 2022 was US$ 71462 million that increased to US$ 82419 million in 2023.

Automobile Market Segmentation

By Vehicle Type (Billion/Unit)

• Two-Wheelers
• Three-Wheelers
• Passenger Car
  • Hatchback
  • Sedan
  • SUV
  • Others
• Commercial Vehicle
  • LCVs
  • HCVs

By Propulsion Type

• ICE Vehicles
  • Diesel
  • Petrol
  • CNG and LPG
• Electric Vehicle
  • Battery Vehicles
  • Plug-in Vehicles
  • Hybrid Vehicles
• Others

By Region

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East and Africa