Automotive Industry Trends 2025

On the bright side, partnerships between automakers and tech companies are fuelling innovation and accelerating development, bringing their vision of safer, smarter transportation closer to reality. In 2023, the global connected car market was valued at $80.87 billion and projecting remarkable growth. It is expected to expand from $95.14 billion in 2024 to $386.82 billion by 2032, reflecting a robust compound annual growth rate (CAGR) of 19.2% over the forecast period according to some figures. Discover trends, forecasts, and global developments shaping the future of mobility. These systems will become increasingly sophisticated, moving toward semi-autonomous driving capabilities and improving the overall driving experience. Environmental consciousness is driving the automotive industry toward more sustainable and eco-friendly solutions.

Cube Intelligence builds Blockchains for Autonomous Vehicles

Self-driving vehicles are becoming increasingly common and will continue to do so in 2025. Research has indicated that autonomous cars are safer, reduce downtime, expand the last-mile delivery scope, and improve fuel efficiency by 10%. Additionally, several trucking companies have tested self-driving technology, and it will soon become commonplace, with fleets of autonomous trucks sharing the road with traditional vehicles. The market share with EVs specifically is even greater, manufacturing 58% of the world’s electric vehicles. While China’s dominance in EV and automotive production at large is not anything new, the movements being made in emerging economies outside of China are.

Important Auto Industry Trends (2025-

It’s clear that a select subset of today’s consumers are willing to pay for high-end automobiles. Power say that sales of cars worth more than $100k were outselling lower-priced cars 3 to 1 in the first quarter of 2022. Instead, they get power from a fuel-cell stack that’s fed hydrogen and oxygen to create electricity through a chemical reaction. According to a study completed by INRIX Transportation, Honolulu, New Orleans, and Nashville are the three US cities that stand to gain the most from micromobility vehicles. The market for micromobility sat at $40 billion in 2020 and is expected to grow to $195 billion by 2030.

This could allow drivers to retain their jobs, but avoid the injuries and deaths that result from exhaustion. Additionally, Chevrolet, Hyundai, Kia, Nissan, and Jaguar have all released more affordable EVs that have a range of anywhere from 200 miles to 250 miles. Right now, there are only about 73,215 public EV charging stations across the US.

Charge Your Porsche Cayenne Electric Like an iPhone

• Automakers will continue to incorporate these systems into even more affordable models, making safety technologies more accessible to a broader range of consumers.
• Rapid technological and environmental innovations have forced incumbents to adapt to new challenges.
• Technology in automotive industry forges ahead—the latest technological advancements are more and more extensively used by the domain.
• The European Union’s Vehicle General Safety Regulation (GSR2), effective July 2024, mandates several ADAS features in new vehicles.
• CARNIQ Technologies secures the auto industry by embedding compliance-driven cybersecurity into development lifecycles.
• Chinese EV automakers’ expansion into new markets, including Europe, other Asian countries, and Latin America as previously mentioned, could see a completely new global EV landscape.
• They also incorporate floating-point units that improve computational accuracy and performance.

The best-selling vehicle in the US, the Ford F-Series pickup, has an average price of $66,451, placing it in the luxury category. In this world where we are shifting to EVs, individuals usually prefer to shift to smaller vehicles which are much more affordable and environmentally friendly. They are much more convenient to use in these congested cities and parking these vehicles is much easier. Younger generations, especially Genz or millennials prefer these vehicles as they are much more attractive. The shortage may not be as bad as it was in the early 2020s; however, even with a larger output, a report has found that only 26% of organisations that are reliant on these chips have a sufficient supply. This leaves the vast majority of companies concerned with their supply and wanting for more.

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Moreover, it ensures perception in challenging conditions such as night, rain, fog, and snow. Also, cloud and edge computing balance fleet-scale analytics with millisecond in-car inference. Digital twins validate updates virtually, with Stellantis using virtual engineering workbenches to test thousands of scenarios before rollout. In addition, Move-X supports over-the-air updates, ensures continuous improvement of system performance, and allows customization across diverse use cases. Moreover, its NuPort solution extends reliability by enabling connections between automotive components that support both diagnostics and long-term endurance. Its solution, carSECURITY, provides organizations with a complete cybersecurity process landscape.

Launch Mobility streamlines Shared Mobility

The industry will continue to experience disruptions from geopolitical headwinds to regulatory and legislative developments, data security and economic challenges. Maximising the ROI to investors and stakeholders while remaining competitive will be priorities of the industry. The continued global expansion of various players will require a strategic focus on supply chain efficiencies and may bring transformation and consolidation in the industry. What initially appeared to be a niche sector is now the foundation of the auto industry’s transition. While automakers spend billions developing electric cars, most governments worldwide have ambitious plans to phase out internal combustion engines.

Tree Map reveals the Impact of the Top 10 Auto Industry Trends

This will further usher the industry into a new era of smarter, more connected, and more efficient vehicles. The startup’s platform combines augmented reality (AR), smart camera, and surround-view monitoring to illuminate the route on turns, curves, slopes as well as complex junctions. This assists the drivers in keeping lanes, prevents collisions, and enables autonomous driving options.

Sustainable Automotive Technologies

The US market was worth $14 billion in 2021 and is expected to grow at a CAGR of 10.7% to reach more than $31 billion by 2028. Tesla reportedly rewrote the software it uses in its vehicles so they could run on a different type of chip. They’re so important that one analyst said, “semiconductors have moved ahead of oil as the world’s key commodity input for growth”. However, the demand for parts is also being diminished by the increasing quality of newly manufactured vehicle parts. In addition, the ecommerce automotive aftermarket market is worth an estimated $85.28 billion.

Automotive Manufacturing North America

• Looking ahead, Tesla’s strategies are likely to influence industry standards and inspire localisation efforts across the sector.
• The transformation of the automotive sector is far from complete, but the direction is clear – towards a more sustainable, connected and intelligent future of mobility.
• By addressing issues proactively, manufacturers and service providers can further reduce breakdowns, enhance vehicle reliability, and improve overall customer satisfaction.
• It enables sensor fusion and control for advanced driver assistance and autonomous driving.
• Discover how these shifts improve charging, safety, and sustainability and what they mean for your business.
• In addition, the unit supports multiple communication protocols, including CAN and FlexRay.

Autonomous driving technologies like AD and ADAS are only possible to implement with the adoption of AI. Driver assistance technology, in particular, can go as far as detecting driver fatigue by monitoring their eyes and taking measures to avoid car accidents. The systems that come together to implement such technologies are sensor fusion, computer vision, and real-time decisions to enable the vehicle to take all complex traffic scenarios easily. Significant investments in AI and Internet of Things (IoT) devices are crucial for fine-tuning self-driving algorithms, making them safer and more reliable. This also presents an emerging opportunity to connect the vehicle ecosystem, creating a dynamic adaptation of data for road and weather conditions, assisted by IoT-enabled devices. Almost 40% of all autonomous vehicles sold in 2025 are predicted to have L2 ADAS features.

Other Technology Trends in Automotive Industry

• Government incentives, environmental imperatives, technological advances, and shifting consumer preferences drive this expansion.
• In 2025, more dealerships are expected to offer online sales, vehicle inspection, and home delivery.
• Emerging companies are developing advanced sensing technologies to collect extensive vehicle data and enable vehicles to better understand their surroundings.
• In 2023, the global connected car market was valued at $80.87 billion and projecting remarkable growth.
• Moreover, the startup’s marketplace connects professionals in a secure environment.
• The startup’s technology allows these pods to adapt across industries, enhancing efficiency and safety in transporting people and goods.
• Also, its platform manages claims and mechanical breakdowns across vehicle models from manufacturers.

Since we’ve already explored the use of AI in the auto industry, it makes perfect sense to discuss connected cars, which are undoubtedly one of the top trends for the future. Connected cars are equipped with cutting-edge technology that allows them to connect to the Internet, other vehicles, and external software. These cars offer numerous benefits, not just for drivers and manufacturers, but also for passengers and the environment. By optimizing driving routes, connected cars help reduce emissions, contributing to a greener future. Using data from IoT technology, drivers receive real-time route suggestions to avoid traffic jams and ease congestion, ensuring faster, stress-free travel. Autonomous driving technology is one of the automotive industry’s most exciting and potentially disruptive developments.

• Just days ago, Jaguar unveiled their new concept car, the Jaguar Type 00, a fully electric, futuristic vehicle that marks a departure from every other car the brand has produced.
• Until these efforts bear fruit, the industry will need to focus on mitigating risks and prioritising demand effectively.
• OEMs are advancing and navigating regulatory challenges to introduce and test L3 and L4 automation, setting the background for augmented adoption of autonomous vehicles.
• The Global Startup Heat Map showcases the distribution of 6000+ exemplary startups and scaleups analyzed using the StartUs Insights Discovery Platform.
• German startup Qumasoft offers a software-driven cybersecurity management solution for vehicles and components.
• The integration of 5G networks is accelerating advancements in vehicle-to-infrastructure (V2I) and vehicle-to-vehicle (V2V) communication, supporting autonomous driving functionalities.

Explore the most important trade fairs and conferences to boost your business success. Contact Avenga today to learn more about what industry experts have to say about these trends. For instance, China has introduced policies encouraging automakers to procure up to 25% of their chips domestically by 2025, reducing reliance on foreign suppliers. There will be continued demand for legacy process technology, with the construction and facilitation of the ESMC fab in Dresden progressing through 2025. Whether this central compute is a monolithic chip such as Nvidia Thor, which will be detailed in 2025, it will also be constructed from chiplets.

🌐 Trend 4: Global Supply Chain Resilience and Geopolitical Shifts

For instance, Audi and BMW vehicles exchanged sensor data, including camera feeds, during 5G-V2X Direct demonstrations in Berlin. This data alerted drivers to pedestrians and cyclists before they became visible. Dedicated short-range communication (DSRC) based on IEEE 802.11p facilitates direct vehicle-to-vehicle and vehicle-to-infrastructure communication. For instance, Volkswagen integrated DSRC-based V2X technology into its Golf 8 and its ID electric series in Europe. Moreover, it enables companies to customize their fleet by choosing preferred brands, models, and service options, ranging from premium to ultra-luxury vehicles. Moreover, blockchain and digital contracts enhance security and automate billing.

In addition, SWYTCHD includes access to premium electric scooters and cars such as the Ola S1 Pro, Ather 450X, TVS iQube, and Nexon EV. This approach enhances road efficiency and reduces fuel consumption, thereby lowering emissions. Regulations such as Europe’s General Safety Regulation 2 (GSR2), US mandates for automatic emergency braking, and China’s target of 70% Level 2-3 adoption by 2025 compel automakers to improve deployment. Moreover, redundancy across sensor types improves resilience in poor weather or low visibility.

This EV Just Set an Efficiency Record

Blockchain secures supply chains and in-car data, and extended reality (XR) advances design, testing, and training. Additive manufacturing shortens prototyping cycles, and IoT-driven analytics improve predictive maintenance. Australian startup V2Grid designs V2G technology that converts EVs into mobile energy resources for homes, businesses, and the national grid.

What are Automotive Industry Trends?

Software-defined vehicles (SDVs) convert the auto industry by shifting control from hardware to software. Automakers move from fleets of electronic control units (ECUs) toward centralized computing platforms that run multiple domains on Systems on Chip (SoCs). Vehicle subscriptions reduce financial barriers for consumers and offer bundled insurance, maintenance, and roadside assistance in predictable monthly fees. For businesses, the vehicle subscriptions lower capital requirements and simplify fleet management. The sensor integrates chip-level innovations that reduce power consumption, simplify hardware complexity, and enable performance through a modular architecture. This design ensures durability, compact packaging, and flexible vehicle integration.

The startup’s sensors provide consistent performance by transmitting and interpreting signals effectively. They also prevent crowding in frequency bands, which is essential for ADAS and autonomous driving. LiDAR provides high-resolution 3D mapping that allows vehicles to detect road geometry, obstacles, and pedestrians with centimeter-level accuracy. Also, radar ensures long-range detection of moving objects in all weather conditions, which is critical for adaptive cruise control and highway safety. Chinese startup Chipv offers automotive semiconductors that combine computing capabilities with motor control and power management.

Moreover, Asia-Pacific is the fastest-growing region, with a projected CAGR of 14.8%. This is fueled by increased vehicle production and sales in China, Japan, and South Korea. The adoption of augmented reality (AR) in head-up displays and automated parking systems is expanding, which is advancing ADAS technologies.

These articles highlight not just the progress made but also the opportunities and challenges that lie ahead. The integration of renewable energy into automotive production took centre stage in 2024. This article sheds light on how OEMs are embracing solar, wind, and hydrogen power to achieve sustainability goals. From energy-efficient factories to green hydrogen applications, the examples showcased highlight the industry’s shift toward greener production methods. Xiaomi’s foray into the electric vehicle market is exemplified by its state-of-the-art factory, capable of producing an electric car every 76 seconds.

• The study offers data-based insights and recommendations for action for decision-makers in the automotive sector.
• By 2025, we could see a broader adoption of fuel cell vehicles, especially in regions like Europe and Asia, where hydrogen infrastructure is beginning to grow.
• Whilst the U.S. may be bucking it, there is certainly a global trend towards a more sustainability-forward manufacturing scene.
• Along with battery-powered electric vehicles, fuel cell electric vehicles (FCEV) are another alternative to internal combustion engines.

For instance, India’s eBus Sewa scheme deploys 10K electric buses to curb urban pollution. Further, it establishes local manufacturing facilities, which reduce supply chain dependency and generate employment and stimulate economic growth. Read on to explore each trend in depth – uncover key drivers, current market stats, cutting-edge innovations, and the 20 leading innovators shaping the future.

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Its vehicle tracking system provides 24/7 real-time visibility, supported by self-install and engineer-fitted options, with no minimum fleet size required. With the introduction of 5G networks, advanced telematics features like real-time diagnostics, autonomous driving, and improved safety systems are becoming even more feasible. Canadian startup Xaba develops intelligent automation solutions, materials, and processes for sustainable manufacturing. Its AI-driven control systems, xCognition and xTrude, enhance industrial robotics and additive manufacturing by automating programming and improving precision. US-based startup Aviva Links builds in-vehicle connectivity solutions that include multi-gigabit Ethernet and ASA Motion Link (ASA-ML) semiconductor products for ADAS systems.

Shift Toward Mobility Services

Its product, THINKey, transforms smartphones into digital keys that allow users to lock, unlock, and start their vehicles. The integration of 5G networks is accelerating advancements in vehicle-to-infrastructure (V2I) and vehicle-to-vehicle (V2V) communication, supporting autonomous driving functionalities. The startup offers tools for real-time calibration health checks for deployed fleets to reduce time-to-market and operational risks. Further, its AI-enabled depth sensor, HiFi, enhances 3D sensing with 1.6-megapixel supersampled depth, 8 TOPS of AI compute, a 136° ultra-wide field of view, and connectivity options like PoE and USB-C. This platform uses secured safety assurance and risk-mitigation principles to detect and address failures in assisted and self-driving systems. Qumasoft’s solution enables companies to develop, produce, and operate cybersecure vehicles and components efficiently.

There are already over 30 million vehicles on the road that meet the Level 1 standard. Some countries (and California) have even committed to phasing why VIN data security matters online out all new sales of combustion engine vehicles over the next few decades. Even with this rapid growth, EV’s share of cars on the road is expected to remain at just 8% by 2030. Sales for BEV and PHEV in Europe increased by 137% in 2020 compared with the previous year (despite a 20% year-over-year decrease in the total car market). Espite growing inventory levels, new vehicle prices continue to rise, reaching a record average transaction price of $49,507 in December 2022.