Technological advancements, changes in consumer preferences, regulatory changes, and global economic conditions drive these trends. The automotive industry is highly dynamic, and trends are subject to change over time. Monitoring and understanding these trends is crucial for automakers, suppliers, and other stakeholders to stay competitive. Due to the pandemic, the automotive sector is undoubtedly facing one of the most challenging periods and a massive slowdown for the last couple of years. This calls for a thorough analysis of recent trends in the automotive industry, So this blog brings you some of the significant car market trends in 2025 that you must know.
Micromobility Presents a Potential Shift Among Consumers
In the first half of 2023, electrified vehicle production surged by 70%, highlighting the rapid pace of investment in EV production capabilities, and continues to grow. As battery technologies evolve, the future promises breakthroughs in recyclability and energy efficiency. Innovations like solid-state batteries are set to revolutionise manufacturing priorities and reshape the EV supply chain.
- As 2024 comes to a close, the automotive manufacturing industry continues to accelerate its transformation.
- Hyundai plans to ramp up its hybrid offerings under its ‘Hyundai Way’ strategy from seven to 14 models by 2030.
- The automobile seminar is utilized by a lot of experts working in the automotive industry, researchers, and people with an affinity for the carmaker as a forum for sharing knowledge and collaboration.
- The UK’s automotive sector offers a compelling illustration of the progress being made.
- Supplemented by the categorisation of our experts, a clear picture emerges of where the industry stands – and where it should develop in order to remain fit for the future.
- Supply chain resilience and nearshoring strengthen operational stability, while vehicle cybersecurity ensures trust in connected ecosystems.
- UK-based startup WF Telematics offers vehicle and asset tracking solutions for businesses seeking efficient fleet management and asset monitoring.
Many auto manufacturers are considering integrating in-car payments to ease refueling, paying for parking or tolls, and even grocery shopping. 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.
Innovation Map outlines Top 10 Automotive Trends & 20 Promising Startups
Developing high-performance, long-lasting, and cost-effective batteries is a key area of focus for automakers in 2025. Batteries are the heart of any electric vehicle, and improvements in battery technology will continue to shape the future of EVs. Companies focus on increasing energy density to improve range and reduce charging times. The trends shaping automotive manufacturing in 2025 emphasize innovation, sustainability, and connectivity. As electric vehicles become mainstream, digitalization reshapes production, and mobility services redefine car ownership, the industry is set to transform how vehicles are manufactured and used.
Self-driving to gain traction, but semi-autonomous cars will reign
Last year, the European Union updated the General Safety Regulation (GSR) and establishes mandatory safety requirements for cars sold in the EU. According to this regulation, starting from 2024, the following features become compulsory. However, there are yet to be more autonomous vehicles on the road due to the technological and safety challenges that must be overcome.
- Driverless cars have sometimes struggled with unexpected incidents on the road and in poor weather conditions.
- Shared micromobility vehicles are becoming a popular mode of transportation in cities where the pollution from cars and traffic congestion is particularly evident.
- Governments also enforce stricter safety standards, pushing automakers to integrate advanced sensor systems.
- XTrude models the physics of FDM processes to optimize parameters like flow rate and extrusion temperature to ensure large-scale 3D printing.
- For example, Valeo, with its SCALA LiDAR, which scans the surroundings 25 times per second at ranges beyond 200 meters.
- From electric vehicles zipping past gas guzzlers to cars that update themselves like your smartphone, the industry is in the middle of a revolution.
- A Deloitte UK study found that 52% of all consumers show no interest in car subscription models; interest is higher among younger people (age 18-34).
They have downgraded their EV targets and scaled back production of fully electric vehicles, suggesting that the transition to EVs will take longer than previously expected. The automotive industry leads in technological innovation that will reshape vehicle design, construction, and user experience in 2025. Emerging automotive industry trends include the increased adoption of electric vehicles (EVs), advanced semiconductors, and the growing focus on vehicle cybersecurity. The future trends in the automobile industry predict a roller-coaster ride for players. In 2025, the automotive industry will face global headwinds such as the energy crisis, slower global demand, and ongoing supply-chain issues.
- The system uses an app to schedule rides on autonomous vehicles, cutting down trip times compared to the available commuting options.
- Manufacturers are partnering with tech companies to design and produce the new operating systems necessary for the next generation of technologically advanced vehicles.
- For instance, India’s eBus Sewa scheme deploys 10K electric buses to curb urban pollution.
- OEMs are advancing and navigating regulatory challenges to introduce and test L3 and L4 automation, setting the background for augmented adoption of autonomous vehicles.
When it comes to the benefits of connected cars, it seems that drivers are more willing to allow for data collection, too. The same report states that 68% of drivers believe car companies should collect personal data, but only 5% agree to unrestricted collection. Most favour an opt-in approach (63%), and many are willing to share data for benefits, with 67% open to lower insurance rates, 43% for personalised features, and 36% for improved safety options. As will be discussed later, with more data being collected for premium features, the inevitable concern for data security is raised, and cyber security threats loom overhead. Connected vehicles are entering a software-defined era where 5G, AI, and V2X convert cars into real-time data nodes that communicate smoothly with infrastructure, other vehicles, and the cloud. Our new report spotlights 10 connected vehicle trends to watch in 2026 that promise safer, smarter mobility and fresh revenue streams for automakers.
Toyota’s Mirai and Hyundai’s Nexo have been the two major players in the market since sales launched in 2016. Along with an increase in refueling stations, look to see an increase in the variety of FCEVs available to consumers in the coming years. In addition, Hawaii passed a bill in 2022 that will create a hydrogen refueling system rebate for developers. Any infrastructure that’s built after January 1, 2023, and utilizes renewable hydrogen will be eligible for up to $200k. The main issue holding back the popularity of these vehicles is a lack of hydrogen fueling stations. Instead, they get power from a fuel-cell stack that’s fed hydrogen and oxygen to create electricity through a chemical reaction.
Despite initial scepticism, the automotive industry is embracing enhanced connectivity by enabling real-time updates and post-production feature additions. Through our work with automotive innovators, we witness first-hand how rapidly this sector is evolving. From electrification and software integration to new mobility models, the industry faces unprecedented change.
Central to this evolution is the growing demand for electric vehicles and software-defined vehicles. British startup Cube Intelligence develops a blockchain-based security platform for autonomous vehicles. The startup’s technology utilizes hash codes to block malicious attacks or hacking attempts on autonomous cars and connected cars. Additionally, Cube Intelligence offers ride-hailing and valet parking services for AVs, as well as smart parking management systems. The automotive manufacturing sector is entering 2025 amidst seismic shifts driven by electrification, digital transformation, and the growing mandate for sustainability.
The Automotive Industry in 2025: Key Focus Areas and Trends
The platform features customizable work product templates, detailed instructions, and comprehensive checklists for self-assessment. It also provides streamlined audit management, structured frameworks for continuous improvement, and intuitive escalation processes. Companies like BYD are collaborating with TSMC and MediaTek to develop advanced chips for vehicle controllers and smart cockpits. Statevolt’s decision to build its gigafactory in the UAE rather than Europe has been a talking point this year. This article explores the strategic reasons behind the move, including the UAE’s favourable energy policies, market accessibility, and logistical advantages. By leveraging these factors, Statevolt is positioning itself to meet the rising demand for EV batteries in an increasingly competitive market.
- Also, IoT sensors such as LiDAR and radar expand perception by generating environmental data.
- The startup uses automotive sensors and compute platforms to offer a scalable solution for cars to enable large-scale fleet learning.
- The autonomous vehicle sector will advance as UN regulators lift their speed limit.
- By incorporating AI tools, the company has reduced production costs while accelerating vehicle launch timelines.
- South Korean startup BOS Semiconductors builds Eagle-N, an AI accelerator for in-vehicle infotainment (IVI) and ADAS.
Renault Twingo E-Tech Is Cute, Clever, and Electric
- These cars offer numerous benefits, not just for drivers and manufacturers, but also for passengers and the environment.
- North America led the AV market in 2024 with over 40% revenue share, while Asia-Pacific is the fastest-growing region, with an expected CAGR of 35% from 2024 to 2033.
- In addition, the startup strengthens automotive cybersecurity with features such as real-time intrusion detection and automated containment protocols.
- For businesses, the vehicle subscriptions lower capital requirements and simplify fleet management.
- Further, this also offers software solutions for fleet and asset tracking as well as connected cars.
This article offers an inside look at the facility and Xiaomi’s ambitious plans in the automotive sector. Meanwhile, we are seeing the economic case for sustainable materials strengthen as manufacturers realise operational efficiency gains and reduce their long-term costs. Cross-industry collaboration is emerging as a key enabler, with automotive companies forming partnerships to develop and implement innovative material solutions.
Safety and Security in Automobiles
Silicon carbide (SiC) semiconductors improve energy efficiency in high-voltage EV systems by reducing losses and enhancing thermal management. Moreover, Asia-Pacific leads the automotive semiconductor market with a 45% global share. In Europe, the EU’s Chips Act aims to raise the bloc’s share of global chip production from under 10% to about 20% by 2030. Moreover, the startup offers fleet-grade protection through continuous monitoring and predictive alerts. Its intelligent asset tracking defends vehicles against spoofing, ransomware, and remote control attempts.
What impact do connected cars have on the automotive market?
It uses Tenstorrent’s Tensix NPU core to deliver up to 250 tera operations per second (TOPS) for efficient AI processing. The Global Startup Heat Map showcases the distribution of 6000+ exemplary startups and scaleups analyzed using the StartUs Insights Discovery Platform. It highlights high startup activity in Western Europe and the United States, followed by India.
What are Automotive Industry Trends?
This ensures precise planning, reduces downtime, and enhances efficiency in assembly operations. This decision also highlights a broader trend toward diversification in battery production hubs. With the Middle East emerging as a significant player in the EV supply chain, manufacturers must adapt their strategies to seize these new opportunities.
MotionSafe enables AI-powered Automotive Cybersecurity
Owing to these advancements, the global SDV market is set to reach USD 3.3 trillion by 2034, growing at 31.2% annually. Also, GPS and V2X connectivity improve fleet distribution and service reliability. Telematics and IoT sensors monitor vehicle condition and enable predictive maintenance. For instance, Planet42 extends access to underbanked consumers in South Africa and Mexico. Additionally, the startup offers features such as platooning algorithms for safe and efficient vehicle grouping.
a. Urban Mobility and Shared Vehicles
We expect to see the concept of Mobility-as-a-Service (MaaS) develop through 2025. Initial deployments focus on simpler, grid-like cities such as Phoenix in the USA, Milton Keynes in the UK, and Singapore. Soon, this will expand to more complex urban environments as vehicle access becomes increasingly prioritised over ownership among the driving masses.
As per market and industry experts, these four trends represent the future of the automotive industry. It won’t take too long for the CASE to accelerate the transition of the automotive industry from the way it has been working for hundreds of years. The modernized vehicles available in the market have opened an opportunity for the firms that supply and also manufacture the parts.
It offers more sustainable 3D printing by developing its own large-scale printing hardware and using fully recycled composite materials. DAM can print parts as large as 1000x3000x1000mm using engineering-grade recycled plastics. Firstly, it accelerates the design and testing process through rapid prototyping.
From these, 20 promising startups are featured below, selected based on factors like founding year, location, and funding. We don’t just regurgitate press releases—we road-trip, wrench, code, and occasionally sleep in dealership parking lots to bring you unfiltered truth. Our proprietary data blends EPA fuel-economy dumps, NHTSA complaint logs, insurance quote engines, and Reddit sentiment (yes, really). The final trend, and one which has been subject to a lot of attention (and hype), is driverless transportation. In addition, it adapts to applications across fleets, workplaces, airports, and multi-housing units.
The Starkenn Brake Safe, a collision mitigation system features automatic emergency braking in critical scenarios. AI-powered semiconductors drive transformation in autonomous driving systems by enabling real-time communication with road infrastructure and enhancing safety features such as emergency braking systems. Tesla’s relentless drive to expand its global gigafactory network has been a defining feature of 2024. This article dives into the company’s ambitious production targets, including the development of Gigafactory Mexico and its innovative approaches to battery cell technology. By streamlining its supply chain through vertical integration, Tesla is raising the bar for EV production efficiency and sustainability.
Discover all Automotive Trends, Technologies & Startups
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.
Xaba builds Industrial AI-driven Control Systems
These pods use AI and machine learning algorithms for real-time perception and adaptive decision-making. The startup’s technology allows these pods to adapt across industries, enhancing efficiency and safety in transporting people and goods. Singaporean startup EVIE Autonomous designs electric, autonomous shuttles for last-mile delivery, passenger transport, agriculture, and cargo movement. Its product range includes an electric modular chassis, the standard autonomous shuttle pod, and pods for other applications.
The region’s substantial market share results from government incentives and the growth of the automobile industry. The increasing adoption of EVs globally drives the optimization of energy usage and enhances features like regenerative braking systems through sensor fusion technologies. To accommodate the rising demand for EVs and autonomous vehicles, major automakers such as BMW, Hyundai, and Stellantis are investing in EV battery plants and semiconductor-related facilities. Sensor fusion and autonomous vehicle technologies enhance safety and enable intelligent driving solutions while ADAS bridges the gap to full autonomy.
The US-based startup Launch Mobility develops a platform for a range of shared mobility solutions. The platform LM Mission ControlTM offers free-floating or station-based car sharing, advanced shuttle services, shared dockless scooters, keyless rental programs, and peer-to-peer shared mobility. Further, their drivers use out-of-the-box or white-labeled apps to manage reservations or remotely access vehicles. Factories equipped with IoT-enabled devices and machine learning capabilities are emerging as the backbone of next-generation automotive production. These facilities use data-driven insights to optimise processes, reduce energy consumption, and increase operational efficiency.
While the market for cars valued below $80k is expected to remain flat through 2031, the luxury car market is predicted to grow at up to 14% CAGR. The chip shortage is one-factor holding cars back from getting to the dealership lots. But, there are other various supply chain issues and factory closures that have led to low inventory, too. After demand started coming back, there simply wasn’t an adequate supply of chips, and the auto industry has been feeling the effects ever since. The parts industry is benefiting from the ever-increasing average age of vehicles on the road.
The AV market is projected to reach USD 1.73 trillion by 2033, growing at a CAGR of 31.85% from 2025 to 2033. Automakers are investing in cybersecurity SaveDelete VIN check explainer article technologies such as hardware security modules (HSMs), AI-based intrusion detection systems, and secure over-the-air (OTA) updates to address these challenges. Automotive Manufacturing Solutions (AMS) is the essential resource for automotive manufacturing professionals and suppliers globally. We invite you to revisit these top stories, share your perspectives, and stay tuned for more in-depth coverage of the trends shaping the automotive world. Looking ahead, JLR’s focus on carbon-neutral manufacturing and environmentally responsible practices sets a powerful example for the industry. The answer lies in education, infrastructure, and trust-building—slow but steady wins the race.