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Infosys'Iknowledge Insttute2|AutomotiveIndustryOutlook 2025External Document@ 2025 Infosys.Limited
Infosys'Iknowledge InstituteCONTENTSExecutivesummaryIndustry dynamicsBusinesstrendslechnologyoutlookThe way forwardAutomotiveIndustryOuatlbok2025|3
Infosys'IknowledgeInstituteEXECUTIVESUMMARYThe automotive industry faces two primaryimperatives in 2025:Eectrilicationofmobility and emeraence of software-definedsoftware-defined industrv. These trends areexperiencing a push forfasterand wideradoption but also face sianificant challenaesA visible recent commitment to electricvehicles (EVs)occuredatthe COP26conference, and the shift to EVs is a key plankachievenet zero.However.althouahsalesof EVs reached 20% of2024.USnewvehiclesales,this pace wasslower thanexoectedGlobal investments in EVs by vehicle makers-such as new EVfactories.battervmaterialsdevelopment, and new technoloaies-slowed due to falling demand.AnothersianificantindustrvtransformationSoftware is becoming a central component ofmodernvehicles.SDVscouldaccountfor909of vehicle production bv 2029. up from only3.4%hin2021.Themarketsizeforautomotivesoftware and electronics is forecast to reach$462 billion by 2030, growing at a compoundannualarowth rate(CAGR)of5.5%from2019continuous software updates, and transitionfrom hardware-first to software-centricorganizationsIn this report, we explore the broad contoursof mobilitv electrification. software-definedautomobile, challenges trend, therole of digital technolories, and providerecommendations to take action.4|AutomotvelIndustryOutlbok2025External Document@ 2025 Infosys.Limited
Infos/s|knowledgeInstituteFinancialinsightsFaure 1isaplot of2024-25 revenue andThe global automotive industry is.tax, depreciation, and amortization(EBITDAexperiencing mixed financial performancefor the laraest automotive companiesin 2025, with moderate revenue increaseInterestinaly,Porsche andMercedes-Bentcoupledwithmarain oressureolled back their decision to stop investmentsThe average new car price in the US hasthovered near record levels of $48,000,to have lowerand fallina marcins.duetowith1.7% vear-over-vear volume arowthprojectedfor2025.However,arowth in alobaldifferentiation, and high-cost batteriesautomobile sales volume has fluctuated thepast few vears, with a sharp decline durindThe automotive industrvshould balancethe pandemic in 2020, a recovery with antsfocuson revenueand orofit marainsCarmakersshould differentiate theirorodurtegrowth in 2024.with new, higher-performinamodels andfeatures; diversify their portfolios beyond EVsThe pressure on profit margins is driven bytariffs investments in new technologiescontrol initiatives explained in the followind(like EVs). raw material cost inflation. intensesections to maintain their healthv orofitcompetition, and supply chain disruptions.marginsFiaure 1.Annualrevenue2024-25 and net orofitmarainforcarmakers18.0%16.0%ToyotaMotorCorpBYDCoLtd-Mercedes-BenzGroupAG14.0%TataMotorsLtdHondaMotorCoLtd12.0%6KiaCorpVolks...
