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Automotive Industry: Difference between revisions
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== Current Trends == | == Current Trends == | ||
=== ING 2024 === | |||
* In 2024, we expect this positive sales momentum to continue but at a much slower pace after a strong increase in the previous year and given a muted macroeconomic backdrop. Our cautious outlook for sales growth across the regions stems from the muted economic outlook for this year across the key geographies with consumer confidence still subdued. With interest rates remaining more elevated right now and second-hand car prices falling, demand for new vehicles is more muted. <ref>https://think.ing.com/downloads/pdf/article/global-car-market-outlook-hitting-speed-bumps</ref> | |||
* Anticipate that light vehicle production volumes will stay flat or increase only slightly year-onyear in 2024. This is because we believe that after the robust rates of production growth during the past two years, in excess of the respective yearly sales volumes, inventories have now been rebuilt sufficiently to allow for more balanced production volumes relative to sales volumes. | |||
* While we anticipate margins softening in 2024 year-on-year, we do not expect, and so far the car manufacturers are not flagging, a particularly pronounced margin dilution this year either. | |||
* Europe and also the US, face a slowdown in EV uptake compared to previous expectations. The main reason behind this is the scaling back of subsidies in large car markets, while subsidies are currently still an important driver for EV sales growth. | |||
* The pressure on new EV prices challenges new and incumbent manufacturers to reduce costs and puts them in a THINK economic and financial analysis Article | 23 February 2024 5 difficult strategic position On the one hand, they are pressed to temporise EV production increases as conventional cars still generate higher margins. On the other hand, progress is important to secure future market share in the run-up to 2030, when EVs will likely see more traction among drivers with further improving economics and improved charging infrastructure. | |||
* Despite the current slackening in demand, the electrification trend inevitably continues and EV rates are still expected to hit 25% in Europe (from 23%). The US is behind in the market penetration of EVs but, supported by IRA subsidies, its share is still expected to go up to 11% in 2024. | |||
=== RSM Global === | |||
* It appears that the EV movement has been dealt a bit of a reality check regarding the speed of consumer adoption. The close of 2023 in North America saw a marked pullback in consumer sentiment regarding EVs, signalling to Original Equipment Manufacturers (OEMs) that the speed of adoption of EVs may be a longer journey than anticipated. <ref>https://www.rsm.global/insights/automotive-and-mobility-trends-watch-2024</ref> | |||
* It is expected that OEMs will continue to invest in this technology (AV) but recognise that aspirations of fully autonomous vehicles will extend into the next decade. | |||
* A new wave of Chinese and Indian automakers and OEMs have begun marketing their products overseas in the EU, US, and Africa, where longstanding brands like Toyota and Volkswagen are losing significant market share. This could significantly impact established European and American brands, compelling them to innovate and reconsider market strategies to stay competitive. | |||
* The move towards non-ownership models like leasing and car-sharing will necessitate a significant strategic shift for the automotive industry. | |||
* The increase in micro-mobility, particularly through e-bikes and e-scooters, is having a profound impact on the automotive industry, especially due to rising urbanisation. | |||
* The growing demand for environmental, social, and governance (ESG) initiatives has been a huge driver of change within the auto industry and looks to continue doing so for the foreseeable future. New regulations in the EU and US are focussed on bringing transparency to sustainability targets. | |||
* That being said, the transformation of the car from a simple means of transportation to a networked system on wheels is having a significant impact on the entire value chain. “Central value creation is increasingly shifting to the software and semiconductor industries, which are the main drivers of this development,” says Mühlenbruch. | |||
== References == | == References == | ||