Automotive 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.

Related insights

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.

• For example, BMW’s San Luis Potosí facility applies digital replicas to reconfigure layouts and minimize waste.
• It enhances safety via driver-assist features and promises to revolutionize mobility with robotaxis and freight automation.
• 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).
• German startup CARNIQ Technologies enhances vehicle cybersecurity through web-based and AI-powered tools that ensure compliance with automotive standards.
• For instance, Texas Instruments‘ AWR2544 radar achieves sensing beyond 200 meters.
• The Tree Map below illustrates the top 10 automotive trends that will impact companies in 2024.

Autonomous vehicles change the face of the auto industry

Issues such as liability in the event of an accident, cybersecurity measures to prevent hacking, and how to deal with AVs in mixed-traffic environments (with human drivers) will need to be addressed. One critical challenge in transitioning to electric mobility is the availability and accessibility of charging infrastructure. By 2025, significant investments in fast-charging networks will be essential for EV adoption to reach mass-market penetration. Advanced Driver Assistance Systems (ADAS) and autonomous driving technologies continue to evolve, bringing unprecedented changes to vehicle safety and functionality.

Q) How Will Adapting to Evolving Tech Landscape Help Automakers?

Its RISC-V IP processors adopt 32/64-bit architectures supported by a nine-stage dual-issue pipeline. EVs typically use 2-3 times more semiconductor content than internal combustion engine models, and in powertrain-specific components, that multiplier is possibly higher. Demand is rising, especially for power electronics, battery management systems, and more energy-efficient chips. In parallel, the startup offers carAISuite, an AI-driven tool that automates engineering and compliance activities.

Rivian’s Big Autonomy Move Includes Its Own Chip

The simulations improve thermal management, safety, and efficiency to meet the demands of future mobility. 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. China’s automotive sector underwent substantial changes, with battery electric vehicle (BEV) sales reaching 582,813 units in August 2024—a 20.8% increase from the previous month. Plug-in hybrid electric vehicle (PHEV) sales also hit a record high, indicating a robust consumer interest in electric mobility.

• While full autonomy is still years away, incremental advances are reshaping vehicle capabilities and market offerings today.
• This leaves the vast majority of companies concerned with their supply and wanting for more.
• And it is projected to widen to 45% by 2030 due to lower labor and freight costs.
• In the UK, auto production surpassed one million units in 2023, marking a significant recovery.
• The shortages have forced manufacturers to delay product launches and reduce outputs, among other issues.
• This approach ensures our reports provide reliable, actionable insights into the automotive innovation ecosystem while highlighting startups driving technological advancements in the industry.
• In Europe, the new General Safety Regulation II (from July 2024) and related standards embed connectivity, advanced sensors, and cybersecurity requirements into safety compliance frameworks.

Reports from key manufacturing shows

• Younger buyers often prefer subscription models or shared mobility over ownership.
• These advanced technologies are widely used across a great number of industries and the automotive domain is no exception.
• The upcoming automotive industry trends refer to evolving changes in patterns within the sector that influence vehicle design, production, marketing, and usage.
• It integrates templates, examples, and practices aligned with ISO/SAE 21434, Automotive SPICE for Cybersecurity, and VDA guidelines.
• This report explores how breakthrough technologies are accelerating the shift toward safer, smarter, and more sustainable transportation systems worldwide.
• With consumers increasingly prioritizing environmental performance when purchasing vehicles, automakers must focus on reducing emissions and developing more sustainable transportation options.

It also provides lane-change algorithms that ensure comfortable lateral movement and personalized passenger comfort profiles refined with each journey. The World Health Organization links 1.35 million annual deaths to road accidents, creating urgency for autonomy. AI, ML, and computing allow vehicles to process data points per second with split-second precision. Further, Chipv creates power control chips equipped with triple RISC-V cores, extensive on-chip memory, and robust hardware security modules. In the US, the CHIPS and Science Act allocates USD 52.7 billion in funding and offers a 25% investment tax credit. It provides grants, loans, and incentives to expand domestic fabs, semiconductor R&D, and the broader supply chain.

Bring the studio to your cars.

The main issue holding back the popularity of these vehicles is a lack of hydrogen fueling stations. The market for FCEVs is expected to grow at a remarkable CAGR of nearly 70%, through 2026. However, that number is smaller than it was in 2019 when more than 80% of people commuted by car. The Wall Street Journal reports that dealerships have been known to charge $40k above MSRP on luxury cars.

Industry 4.0 and Digitalization in Manufacturing

Singapore’s adaptive traffic signal systems, along with real-time monitoring, ERP pricing, and predictive analytics, improve traffic efficiency. The automotive V2X market reached USD 2.87 billion in 2025 and is expected to expand to USD 18.67 billion by 2030 at a CAGR of 45.43%. This rapid expansion reflects its role in reducing road accidents, enabling connected mobility, and smart city systems worldwide. Moreover, the startup engineers the ECU platform with compliance to ISO for functional safety. It also aligns with ISO for cybersecurity and ensures reliability under demanding automotive standards. Also, automotive Ethernet and time-sensitive networking (TSN) provide deterministic in-vehicle data highways that keep safety-critical communication reliable.

Distributed Additive Manufacturing enables Large Scale Sustainable Parts Production

The move highlights the scale of investment required to meet zero-emission vehicle targets and align with regulatory pressures for decarbonisation. The road to 2025 is set to bring even more dynamic changes, with global collaborations, technological breakthroughs, and bold strategies defining the future of manufacturing. This article profiles the top five Chinese automotive original equipment manufacturers (OEMs) leading the industry in sales volume and market capitalization.

Launching of fuel cell EVs

• German startup ChargeX offers a modular EV charging solution that converts parking spaces into charging stations.
• EV sales are going to increase aggressively in 2025, providing a bright spot in the automotive industry.
• The same report states that 68% of drivers believe car companies should collect personal data, but only 5% agree to unrestricted collection.
• Leading companies such as Volkswagen, General Motors, and Volvo have committed to producing zero-emission vehicles and achieving carbon-neutral operations by mid-century.
• BOS Semiconductors focuses on high-performance, energy-efficient AI solutions to drive innovation in autonomous driving and enhance in-cabin experiences.
• Most consumers today are much more concerned with what the in-cabin experience is going to be, than the size and power of the engine.
• 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.
• While some regions already allow limited AV testing and deployment, 2025 will likely see a more transparent legal framework surrounding autonomous driving technology.
• Get in touch to easily and exhaustively scout relevant technologies & startups that matter to you.
• One of the most promising companies in the autonomous trucking ecosystem is TuSimple.

Companies like Toyota and Hyundai are investing in hydrogen fuel cell technology. 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. In addition to electrification, hydrogen fuel cell technology is gaining traction as a potential solution for zero-emission transportation. Hydrogen-powered vehicles produce only water vapor as a byproduct, making them a strong contender for sectors that are harder to electrify, such as long-haul trucking and commercial transportation. While regulatory hurdles remain, 2025 will likely see significant progress in integrating these services into urban infrastructure, offering consumers affordable, sustainable alternatives to owning a car. On top of all the 2025 automotive trends there will be the impact of tariffs set by the US and Europe.

Further, this also offers software solutions for fleet and asset tracking as well as connected cars. AI is also transforming automotive manufacturing by speeding up production and cutting costs. 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. In 2024, the automotive industry experienced significant transformations, with advancements in electric vehicles (EVs), autonomous driving technologies, and shifts in global markets. The auto manufacturers who rely on the older versions of chips which are not advanced and powerful will disrupt the growth of the automotive industry.

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 transform car shopping with full transparency 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.

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.

Dealerships can take advantage of different video formats, like how-to videos, car highlights, and customer testimonials. For this in-depth research on the Top Automotive Trends & Startups, we analyzed a sample of 6000+ global startups & scaleups. Volvo has adopted megacasting techniques to simplify EV production, reducing the number of components required and streamlining assembly processes. This both lowers costs and improves vehicle performance, addressing both market demands and sustainability goals. Connectivity is one of the key trends in automotive industry, and 5G is what takes it to a more advanced level. 5G facilitates faster data transmission, higher network and bandwidth capacity as well as improves security (e.g., protection from cyberattacks).

• 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.
• It processes these tasks in real time at over 120 frames per second on consumer-grade graphics processing units (GPUs).
• Manufacturing was not spared either, representing 29% of global ransomware targets, an alarming 56% rise over the previous year.
• For businesses, the vehicle subscriptions lower capital requirements and simplify fleet management.
• Collecting user data through these sensors creates ample opportunities for marketers to promote upselling.
• The next decade will undoubtedly see dramatic changes in how we drive, how we share vehicles, and how we engage with the technology that powers our transportation systems.

Lithium-ion battery prices have fallen by 89% over the last decade, reaching a price of $137/kWh in 2020. After a disappointing 2019 in terms of EV sales, 2020 sales surpassed expectations, growing over 40% year-over-year. The industry itself, however, has remained relatively stable over the last decade.

The convergence of AI-driven production systems, the scaling of EV capabilities, and the adoption of sustainable practices will reshape the competitive landscape. Manufacturers that successfully integrate these elements into their strategies will not only navigate the challenges of today but also position themselves as leaders in the future of mobility. Artificial Intelligence and Smart Factory technologies are no longer aspirational but integral to modern automotive manufacturing. Stellantis, for instance, has demonstrated how AI can transform production efficiency. By incorporating AI tools, the company has reduced production costs while accelerating vehicle launch timelines.