The global ADAS market is projected to reach USD 36.6 billion by 2025, with a CAGR of 10.8% from 2025 to 2037. Level 3 (conditional automation) and Level 4 (high automation) systems are gaining traction, with broader availability expected in Europe and North America by 2025. The AV market is projected to reach USD 1.73 trillion by 2033, growing at a CAGR of 31.85% from 2025 to 2033. Tangram Vision allows perception teams to focus on product-specific features by handling complex sensor tasks and accelerating development and deployment processes. 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.
🚗 Subscription Models and Car-Sharing Services
Its product range includes an electric modular chassis, the standard autonomous shuttle pod, and pods for other applications. The need for high-performance processors is also growing as a result of software-defined vehicles (SDVs), which rely on semiconductors for ongoing updates and subscription-based services. The global automotive semiconductor market is projected to grow from USD 53.57 billion in 2025 to USD 86.81 billion by 2033, with a CAGR of 6.22%. Join us today and access AMS’s wealth of global news, insights, intelligence and content, and to make valuable connections with your peers from across the automotive industry. Volkswagen is using digital twin technology at its Wolfsburg plant to simulate and optimise production processes for the Tayron SUV.
Vehicle purchases shift online
By 2035, approximately 16% of all new LV (light vehicle) sales in the US are predicted to consist of advanced automated vehicles (L3, L4, and L5). New vehicle inventory levels till December 2022 were 52% below December 2019 but 56% above January 2022. On the other hand, personal vehicles are on the rise due to improving urban road infrastructure, and the popularity of pre-owned cars among young people is also driving the market growth. North American and European automakers offer consumers the option to buy vehicles online without visiting dealerships. With a computer or smartphone, buyers can choose desired features, secure financing, and even take virtual walk-around and test drives. In 2025, more dealerships are expected to offer online sales, vehicle inspection, and home delivery.
Electric Vehicle (EV) Production Expansion
- Artificial intelligence (AI), the Internet of Things (IoT), blockchain, and advanced semiconductors allow autonomous driving, predictive maintenance, and secure connectivity.
- For EVs specifically, weight reduction translates directly into extended range and improved battery performance.
- Plug-in hybrid electric vehicle (PHEV) sales also hit a record high, indicating a robust consumer interest in electric mobility.
- It combines a gasoline engine with an electric motor to enhance fuel efficiency and reduce emissions.
- Blockchain technology is increasingly being utilized in the automotive industry for various applications.
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.
Automotive Industry Trends 2025: Shifting Gears Toward Innovation
- AI and predictive analytics enhance demand forecasting, risk detection, and sourcing optimization.
- The control system includes safeguards like automatic overheating prevention, battery depletion protection, and real-time torque and speed calibration for optimal performance on challenging terrains.
- The startup’s platform, Aqueduct, is easy to install, has 4 charging modules with up to 22kW, provides monthly reports, and uses a Typ2 charging cable.
- Also, MotionSafe protects the auto industry by securing vehicle data, supporting supply chains, and ensuring a safe transition to connected mobility.
- Also, the Customer Acceptance Index improves design validation by offering instant customer feedback.
- The AV industry itself is just in its infancy, as there are only 17,000 self-driving cars on the road in the US today.
- Digital twins—virtual replicas of physical systems—are gaining traction, enabling manufacturers to simulate scenarios and predict outcomes in real-time.
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.
Major transportation industry trends in 2026
As a result, vehicles become even more connected with each other and the infrastructure and provide drivers with more advanced opportunities. The future of automotive industry trends suggests that the automotive parts market will grow aggressively due to a growing demand for replacement parts and an increase in vehicle production. The segment’s sales will rise in the first six months of fiscal 2025, while the industry’s revenue will increase at the same pace to $33.8 billion. According to Globe News Wire, the entire market will grow at a CAGR of 5.5% from 2025 to 2033, logging USD 984 billion. Automakers and technology companies are forming partnerships due to vehicles’ constantly evolving tech requirements.
More automakers collaborating with tech companies
Notably, China, Europe, and the US have established themselves as the leading EV markets, with other countries following suit. Norway set a record in the electric vehicle sector in August 2024, as the number of all-electric vehicles on the road surpassed that of gasoline-powered vehicles for the first time. In terms of new car sales, Norway boasts the highest percentage of battery-electric vehicles in Europe. It also leads Europe in new EV market activity, with just 9.61 percent of new passenger car sales in 2023 attributed to gasoline, diesel, and non-rechargeable hybrid vehicles. By 2025, V2X technology is expected to significantly create more innovative transportation networks and advance autonomous driving capabilities.
Top 10 Automobile Industry Trends & Innovations (
Let’s have a closer look at the top automotive trends poised to dominate the landscape in 2025. 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. Automakers are also adopting hyper-personalized features to offer customized experiences through infotainment systems, user profiles, and real-time navigation updates. Many of these vehicles will feature over-the-air (OTA) upgrades and V2X communication. Xaba’s proprietary process and AI-driven large-scale 3D printer enable sustainable materials, such as fibers, fiber-reinforced polymers, and metals, to create functional car chassis. Toyota intends to power its battery plant in North Carolina with renewable energy by 2025.
wrap up and 2025: EV batteries, gigafactories, sustainability and smart factories in auto manufacturing
US-based startup MotionSafe provides AI-powered cybersecurity solutions that protect connected vehicles from data breaches and cyber threats. Vehicle cybersecurity drives one of the fastest-growing areas in the auto industry as connected vehicles multiply and cyber risks intensify. Analysts project the automotive cybersecurity market to increase from USD 5.24 billion in 2025 to approximately USD 18.88 billion by 2034, advancing at a CAGR of 15.3%. Geopolitical risks, regulatory frameworks, cost advantages, and compliance needs drive the auto industry toward supply chain resilience and nearshoring.
Rise in autonomous self-driving cars
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.
Toyota Launches the Urban Cruiser EV—Just Not Here
Ransomware-related costs in the automotive industry skyrocketed from $74.7 million to $209.6 million in just the first half of 2023. System downtime caused by these attacks reached $1.99 billion, compared to $1.3 billion in 2021. AI, automation, and an ‘electric-first’ mindset are impacting every industry, and automotive is no exception.
- The massive rotation in the global vehicle fleet is predicted to take place in the 2030s.
- These advancements are driving the future of connected vehicles, which are increasingly becoming a standard feature in new cars.
- The US National Highway Traffic Safety Administration (NHTSA) estimates that V2X addresses up to 80% of crashes involving non-impaired drivers.
- Whilst these acts have been active for some years now, the landscape has not changed drastically.
- Paul Marinelli gets straight to the point—exploring key trends and innovations shaping tomorrow’s mobility in just five minutes.
- In some cases, car dealerships are charging huge markups on the inventory they do have.
- Also, applications extend from adaptive cruise control, lane-keeping, and traffic jam assistance to robotaxis and driverless trucking.
🌐 Trend 4: Global Supply Chain Resilience and Geopolitical Shifts
The global automotive industry, responsible for 10% of the world’s carbon dioxide emissions, faces ongoing pressure to overhaul its practices. However, the landscape is proving difficult to steady with an intricate maze of regulations that differ by country or region and lack a unified benchmarking process for sustainability. In these regions, shared mobility options like vans, minibuses, and two- and three-wheelers are more common and often electrified due to their affordability.
- The startup also operates PartSmart, a real-time parts ordering platform that connects insurers, workshops, fleet owners, and suppliers.
- If you want to learn more about 10 of the most important auto industry trends for the next months, read on.
- The startup emphasizes comfort with electric doors, extended safety features, and panoramic views from all seats.
- They shift the industry toward electrification, digitalization, and connected mobility.
- The simulations enhance precision and minimise waste in this energy-intensive stage of manufacturing.
- Automotive Manufacturing Solutions (AMS) is the essential resource for automotive manufacturing professionals and suppliers globally.
- With established automakers facing nimble startups in the mobility race, building new businesses should be a priority for auto executives.
- Autonomous vehicles (AVs) are advancing transportation by minimizing the need for human drivers and enhancing last-mile delivery efficiency.
Its technology transports ultra-high-bandwidth video and data from sensors to processors with ultra-low latency. For this, it uses advanced system-on-chips (SoCs) that integrate mixed-signal analog and digital signal processing (DSP) algorithms. This includes driver monitoring systems, adaptive cruise control, and collision avoidance systems.
Advancements in ADAS and Autonomous Technologies
OEMs are advancing and navigating regulatory challenges to introduce and test L3 and L4 automation, setting the background for augmented adoption of autonomous vehicles. Additionally, smart virtual assistants are emerging as a key HMI feature, aiding drivers and passengers in interacting with vehicles and external services. The global Automotive Human Machine Interface market, valued at USD 70.41 billion in 2022, is expected to grow significantly, reflecting these advancements in automotive technology. These solutions decrease fleet wait times and cut pollution from petrol or diesel vehicles. Modern vehicles are now equipped with a unique digital identity, making it easier to track and share data for applications like insurance, driver safety, predictive maintenance, and fleet management.
What technology is used in the automotive industry?
Toyota’s North Carolina battery plant exemplifies this commitment, with operations fully powered by renewables. Recycling initiatives, such as reusing EV batteries, further emphasize the industry’s shift toward circular manufacturing. “Advanced sensors will make a significant impact on ADAS solutions by providing more accurate data and improving safety maneuvers, from lane-keep-assist to auto parking and braking,” added Lyons. The automotive industry was perhaps the saving grace protect your family budget from bad cars of the European semiconductor industry in 2023, but reality has hit hard in 2024. Auto brands that stay on top of these trends and continue to innovate will be able to build a resilient business, that will help nurture a more electrified, connected, and sustainable future. With EV makers in China engaging in a price war due to declining demand, Chinese brands with strong hybrid presently are gaining popularity.
- New vehicle inventory levels till December 2022 were 52% below December 2019 but 56% above January 2022.
- With the new administration of Donald Trump in January, the trade war with China will have a major impact on the automotive industry in 2025.
- The currently available infotainment systems can connect with smartphones, sensors, ADAS (advanced driver assistance systems) as well as other in-vehicle and external systems.
- The trends shaping automotive manufacturing in 2025 emphasize innovation, sustainability, and connectivity.
- The auto industry is one of the largest and most influential markets on the planet.
- Expect more robotaxi pilots, fleet autonomy, and advanced safety features integrated into mainstream cars.
Supply chains are being restructured to secure critical minerals and diversify chip sources. The industry is also innovating in battery chemistry, thermal management, and vehicle-to-grid (V2G) tech to improve EV usability. As we progress through 2025, these trends will continue to reshape the automotive landscape.
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).