US Automotive Market 2024–2033

Reports Description

US Automotive Market was valued at USD 4.8 Billion in 2024 and is expected to reach USD 13.8 Billion by 2033, at a CAGR of 10.6% during the forecast period 2024 - 2033.

The automotive industry includes the design, development, manufacture, marketing, and sale of automobiles, trucks, buses, and motorbikes. It involves a complicated network of businesses, including automakers, suppliers, dealerships, and aftermarket service providers.

US Automotive Market Growth Factors

Demand for compact size, aesthetic look and affordability

Compact size, fashionable design, and affordability are key factors that propel the market for passenger vehicles. Urban residents looking for convenient parking alternatives and mobility in crowded metropolitan situations are drawn to compact sizes.

Attractive design has a major role in drawing customers since aesthetics affect the items. Furthermore, economic value appeals to growing countries and consumers on a tight budget since it is affordable, fuel-efficient, and requires little maintenance.

In addition to improving passenger cars' overall appeal, these features also take care of practical problems like usability and pricing, meeting the demands and tastes of a broad spectrum of customers.

As an outcome, in the cutthroat automobile industry, cars that combine small size, fashionable design, and affordable price are in more demand and have greater market success.

For instance, Suzuki has unveiled the 2024 Swift hatchback in Germany, marking its third international market launch following Japan and the United Kingdom. The fourth generation of the hatchback boasts a redesigned external design, a completely new interior, several new amenities, and a smaller three-cylinder petrol engine.

Rising popularity of electric vehicle

The growing popularity of electric cars (EVs) is having a substantial influence on the US automobile sector on several levels. Increased concern about climate change and the quest for sustainable transportation solutions have fuelled customer interest in EVs, driving automakers to extend their electric car options.

This has resulted in increasing market rivalry, which is pushing innovation and technological breakthroughs in EV technology. Furthermore, government incentives and regulations targeted at lowering carbon emissions have played an important role in increasing EV adoption.

Federal tax credits, state rebates, and subsidies for EV purchases have made electric vehicles cheaper to customers, therefore encouraging their adoption. Furthermore, stricter pollution rules and mandates for zero-emission vehicle (ZEV) sales quotas in certain states have spurred automakers to invest in electric vehicles.

Furthermore, advances in battery technology, which resulted in reduced costs and longer driving ranges, have addressed important issues such as range anxiety, making EVs a more practical alternative for regular customers.

As a result, the US automotive sector has seen a dramatic shift towards electric cars, with EV sales continuously growing and electric models gaining market share from traditional internal combustion engines. This trend is projected to continue as EV infrastructure improves and customer awareness rises, altering the automotive environment.

For instance, Hyundai launched IONIQ 5 as the first model in Hyundai’s new IONIQ brand line-up in Germany. IONIQ 5 is built on the Electric Global Modular Platform (E-GMP), Hyundai Motor Group’s platform dedicated to battery electric vehicles. Customers can select between either all-wheel (AWD) or rear-wheel drive (2WD) with a 72.6 kWh battery.

US Automotive Market: Restraints

High cost and supply chain disruption

High production expenses result in higher car prices, which lower accessibility and decrease buyer demand. These costs are influenced by several variables, including labour expenses, costs of raw materials, and compliance with regulations.

Disruptions to the supply chain, such as delays in logistics or shortages of essential parts, can also affect production schedules and car availability, which increases pricing pressure and affects sales. These difficulties not only affect manufacturers but also auto dealers, suppliers, and customers, clouding the market and preventing expansion.

Moreover, supply chain interruptions have become more severe in the context of international events like the COVID-19 epidemic, and Russia Russia-Ukrainian War demonstrating the passenger car market's susceptibility to outside shocks and emphasizing the necessity of resilience and adaptation amid such difficulties.

US Automotive Market: Opportunities

Integration of IoT and ADAS

The blending of Internet of Things (IoT) technology with Advanced Driver Assistance Systems (ADAS) has transformed the passenger vehicle business by improving security, comfort, and connectivity. More precise and flexible driver assistance features are made possible by the Internet of Things, which makes it possible for ADAS-equipped cars to gather and send real-time data from many cameras, sensors, and linked devices.

IoT-enabled ADAS systems, for instance, can give proactive breakdown warnings, automated cruise control, and lane keeping assistance by analyzing traffic patterns, highway conditions, and vehicle performance data.

IoT connectivity also makes it possible for mobile devices and smart home systems to integrate seamlessly, giving drivers the ability to remotely monitor and manage their cars, access navigational aids, and get tailored suggestions.

In general, the combination of ADAS and IoT technology enhances not just driving enjoyment and safety but also transforms the passenger vehicle market by offering innovative features and personalized experiences to consumers.

For instance, Here Technologies, a location data business, announced a new cooperation with Bosch and Daimler Trucks' German branch to create an advanced driver assistance system (ADAS) for commercial vehicles.

The agreement, announced at CES, coincides with the release of Here's new Advanced Traffic Patterns technology, which uses sensors, telematics systems, and mobile devices to produce precise traffic data. Bosch and Daimler are working together to create ADAS technology that will automatically detect the most energy- and emissions-efficient driving style, assisting vehicles in transitioning to a more sustainable future.

US Automotive Market: Segmentation Analysis

US Automotive market is segmented by vehicle type, propulsion type, and region. Based on vehicle type, the market is classified into passenger cars, commercial vehicles, and two wheelers. Passenger cars dominated the market in 2023 with a market share of 56.1% and are expected to keep their dominance during the forecast period 2024-2033.

Passenger vehicles have historically played an important part in the United States automotive market, accounting for a sizable share of vehicle sales and consumer preferences. However, in recent years, their supremacy has been threatened by the increasing popularity of light vehicles such as SUVs, crossovers, and pickup trucks.

This transition is being driven by changing customer choices, growing lifestyle requirements, and technological breakthroughs in automobiles. Consumers are increasingly valuing utility, adaptability, and fuel efficiency, which light trucks frequently provide over traditional passenger vehicles.

Furthermore, decreasing petrol costs, increased fuel efficiency in light trucks, and strong marketing techniques by automakers have all contributed to their increasing market share. As a result, several manufacturers have altered their manufacturing and marketing efforts to suit consumer demand for light trucks.

However, passenger cars continue to play a considerable role in the US automotive market, notably in classes such as sedans, hatchbacks, and electric vehicles. Some buyers like the handling, manoeuvrability, and affordability of passenger automobiles, particularly in metropolitan areas.

Based on propulsion type, the market is classified into internal combustion engines, electric and hybrid. Internal combustion engines dominated the market in 2023 with a market share of 46.8% and are expected to keep their dominance during the forecast period 2024-2033.

The internal combustion engine (ICE) has been the major driver of the United States automobile market due to its adaptability, dependability, and efficiency. ICE-powered automobiles gave Americans a handy and accessible method of transportation, influencing not only personal mobility but also industry, business, and society.

ICE-powered cars have a wide range of fuel options, starting with petrol and progressing to diesel, ethanol, and other alternatives. This versatility enables producers to meet a wide range of customer demands and regulatory needs.

Furthermore, the broad availability of petrol and the establishment of a vast network of petrol stations aided the nationwide adoption of ICE cars. This infrastructure enabled long-distance travel, resulting in the spread of suburban life and business.

Moreover, ongoing innovation in ICE technology has resulted in gains in performance, fuel efficiency, and pollution control, increasing the attractiveness of these cars among customers. Despite recent advances in electric and hybrid cars, internal combustion engines continue to dominate the US automobile sector, accounting for the vast majority of vehicle sales.

However, growing concerns about the environment and reliance on fossil fuels are pushing a move towards cleaner and more sustainable alternatives, undermining the internal combustion engine's long-held supremacy.

Report Scope

US Automotive Market Recent Developments

• In July 2023, Porsche introduced the Cayenne SUV line with an approximately 500-horsepower twin-turbo four-liter V8 and an approximately 200-horsepower electric motor, producing 664 pound-feet of torque. The Cayenne E-Hybrid and Cayenne S versions are available in the United States.

• In September 2023, BMW Group and Qualcomm Technologies, Inc. expanded their collaboration to include the latest Snapdragon® Digital Chassis™ Solution advancements. This will power BMW Group's new vehicles, providing drivers and passengers with safer, smarter, and more sophisticated experiences.

• In August 2023, Tesla unveiled less expensive variants of its Model S sedan and Model X SUV with shorter driving ranges in the US The Model X SUV has a range of up to 269 miles, well below its more expensive versions that offer up to 348 miles. The Model S has a driving range of up to 320 miles (515 km), which is lower than the regular dual-motor and tri-motor Plaid variants which offer up to 405 miles and 396 miles.

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List of the prominent players in the US Automotive Market:

• General Motors
• Ford Motor Company
• Tesla Inc.
• Toyota Motor Corporation
• Honda Motor Co. Ltd.
• Fiat Chrysler Automobiles
• Nissan Motor Corporation
• Volkswagen Group of America
• BMW Group
• Mercedes-Benz USA
• Hyundai Motor America
• Subaru of America
• Kia Motors America
• Audi
• Porsche
• Mazda North American Operations
• Volvo Car USA
• Mitsubishi Motors North America
• Jaguar Land Rover North America
• Rivian Automotive
• Others

These key players are adopting various growth strategies such as mergers & acquisitions, joint ventures, expansion, strategic alliances, new product launches, etc. to enhance their business operations and revenues.

The US Automotive Market is segmented as follows:

By Vehicle Type

• Passenger Cars
• Commercial Vehicle
• Two Wheelers

By Propulsion Type

• Internal Combustion Engine
• Electric
• Hybrid