In 2020, the auto industry had to make its way through the pandemic with a 16% decline in production and a 12% decline in sales. Despite semiconductor supply crunch ~ 82.6 million vehicles were sold in 2021. 68% of sales are contributed by the passenger’s cars only. China remained the largest and best-performing major single-country car market in the world with sales up to 6.6% which amounts to more than 21 million vehicles.
Electric vehicle (EV) is the future of the automotive industry. Massive investments in EV ecosystems have been seen in the last few years. Growing EV infrastructure, technological advancements in battery storage, tightening emission regulation, and government incentives are likely to increase global EV sales. Public spending on subsidies and incentives for EVs nearly doubled in 2021 to nearly USD 30 billion.
After the COVID-19, the semiconductor industry has slightly improved their product delivery but the supply chain remains fragile due to the potential risks caused from the pandemic and other events. Experts have estimated the semiconductor production capacity to match the demand by mid of 2023, but it is expected to happen only by the end of 2024. Building production capacities are facing constraints due to equipment and skilled labour shortages.
In recent times, CASE (Connectivity, Autonomous driving, Shared/Smart mobility, and Electrification) technological trend are appreciably changing the concept of the automobile. Connected car penetration varies by region and country according to offered infrastructure and is the biggest enabler for autonomous vehicles. Advanced technologies like AI and 5G will fuel connected vehicle growth.
The reality of AVs once thought impossible is a stride towards success. Still, many more to develop on the technology front, but the optimism about AI and ML is growing, 1:10 vehicles is expected to be fully automated globally by 2030.
In addition to vehicle ecosystem players, others such as telecom are expected to be part of new developments and new technologies and services. With building layers of innovations, Autonomous vehicle is also estimated to reach pure autonomy without human interventions. AI and machine learning development will chip in AV adoption easily across the globe, but again different technologies such as AI, 5G, and Analytical capabilities in self-driving cars will be crucial.