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On 13th June 2024, Frost & Sullivan presented a comprehensive analysis of the global automotive market during the 2024 APAC Fleet Summit in Bangkok, highlighting transformative trends and their impact on Southeast Asia. The presentation provided valuable insights into market dynamics, key trends, and predictions for 2024, focusing on the automotive industry’s growth pipeline and future outlook.

Below is a summary of their findings:

Key Global Insights 2023 & 2024

In 2023, the light vehicle market experienced a 0.8% growth, driven by economic recovery and resolved supply chain challenges, particularly in semiconductor chips. China led the growth with an 11% year-on-year (YoY) increase in vehicle units sold, followed by the USA (12%), India (8%), Japan (15%), and Germany (9%). Global electric vehicle (EV) sales reached 14.1 million units, with battery electric vehicles (BEVs) accounting for 70% and plug-in hybrid electric vehicles (PHEVs) for 30%. BYD remained the market leader, selling 2.9 million units globally, while Tesla followed with 1.8 million units.

Automotive LV Market Predictions for 2024

The light vehicle market is expected to grow by 1.3% YoY in 2024, with sales projected to reach 81.5 million units. China, Europe, North America, South America, India, Japan, and Korea are anticipated to be the major contributors to this growth. The top five markets will account for 65% of all new light vehicles sold, with China continuing to lead the pack.

Top Trends Driving the Global Automotive Industry
  1. Battery as a Service: The rise of battery leasing models to reduce upfront costs and enhance EV adoption.
  2. Gigacasting: Adoption of large-scale casting processes to streamline vehicle manufacturing.
  3. Micromobility: Increased popularity of small, electric-powered personal transportation options.
  4. Vehicle-to-Grid (V2G) Compatibility: Development of vehicles capable of returning power to the grid, promoting energy efficiency.
  5. Green Materials: Use of sustainable materials in vehicle production to reduce environmental impact.
  6. New Battery Chemistries: Introduction of advanced battery technologies like sodium-ion and solid-state batteries.
  7. Software-Defined Vehicles: Acceleration in the development of vehicles that rely on software for key functions.
  8. Generative AI: Integration of AI technologies to enhance automotive manufacturing, supply chain management, and in-vehicle experiences.
  9. Online Sales: Growth of digital platforms for vehicle sales and customer engagement.
  10. Surge of Chinese Automakers: Continued expansion and influence of Chinese automotive manufacturers in the global market.
Impact on Southeast Asia

Southeast Asia (ASEAN) plays a significant role in the global automotive market, with key countries like Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam contributing to the region’s economic growth. The automotive market in ASEAN is poised for steady growth, driven by increasing demand for private vehicles and favourable economic conditions.

  • Thailand: Emerged as the primary automotive production hub, with significant investments from Chinese OEMs like BYD and Great Wall Motor. The country aims to produce 725,000 EVs annually by 2030 under its 30@30 policy.
  • Indonesia: Known for its abundant nickel resources, Indonesia has attracted substantial investments in EV production. Key projects include BYD’s $1.3 billion factory and Hyundai’s battery cell factory in Karawang.
  • Vietnam: Domestic brand VinFast dominated BEV sales in 2023, reflecting the country’s growing focus on EV adoption.

The global automotive industry is undergoing a significant transformation, driven by advancements in EV technology, sustainable practices, and digitalisation. Southeast Asia is set to become a pivotal player in this evolution, with countries like Thailand and Indonesia leading the charge in EV production and adoption. As the industry navigates these changes, strategic partnerships, innovative technologies, and a focus on sustainability will be crucial for continued growth and success.

Thank you to the Fleet APAC organisers for their invitation and to Frost & Sullivan for sharing their expertise.

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