Passenger Cars Market Size, Share & Trends Analysis Report By Propulsion Type (ICE, Electric), By Vehicle Class (Luxury, Economy), By Type (Hatchback, MUV, Sedan, SUV), By Region, And Segment Forecasts, 2024 - 2030

Passenger Cars Market Size, Share & Trends Analysis Report By Propulsion Type (ICE, Electric), By Vehicle Class (Luxury, Economy), By Type (Hatchback, MUV, Sedan, SUV), By Region, And Segment Forecasts, 2024 - 2030

Passenger Cars Market Growth & Trends

The global passenger cars market size is anticipated to reach USD 9,664.49 billion by 2030, growing at a CAGR of 16.2% from 2024 to 2030, according to a new report by Grand View Research, Inc. The market growth is attributed to the growing demand for eco-friendly and fuel-efficient vehicles. With increasing concerns about environmental sustainability and the need to reduce carbon emissions, there has been a significant shift towards electric and hybrid vehicles. This shift is driven by stringent government regulations aimed at reducing greenhouse gas emissions, as well as by consumers' increasing preference for cleaner and more sustainable transportation options.

For instance, in August 2022, the California Air Resources Board (CARB) initiated a new rule, The Advanced Clean Cars II, to rapidly increase the number Of Zero-Emission Vehicles (ZEVs) on the road and reduce greenhouse gas emissions from the transportation sector. The rule requires that by 2035, 100% of all new cars sold in California must be ZEVs. In 2026, 35% of all new cars and light trucks sold in California must be ZEVs. This percentage will increase to 50% in 2028, 65% in 2030, and 100% in 2035. As a result, this demand for eco-friendly cars has led to a surge in the development and production of electric and hybrid vehicles by major automotive manufacturers, thereby fueling the demand for passenger cars across the globe.

The global automotive industry has been witnessing a paradigm shift with the increasing investment and development in alternative transportation modes such as high-speed trains, hyperloop technology, and autonomous vehicles. These emerging modes challenge the traditional dominance of passenger cars by offering efficient, cost-effective, and environmentally friendly alternatives. For instance, high-speed trains provide a convenient and rapid transportation, particularly for long-distance travel, thereby reducing the demand for passenger cars, especially for intercity commuting. Additionally, hyperloop technology provides unprecedented speeds, potentially revolutionizing transportation and providing a viable alternative to conventional road travel, which could further dampen the demand for passenger cars. As a result, such factors hamper the market growth to a certain extent.

The rapid development and adoption of Electric Vehicle (EV) technology have significantly influenced the global passenger car market. Factors such as advancements in battery technology have driven the shift toward EVs. This transition has reshaped the automotive landscape and also sparked a wave of innovation across the industry. Additionally, the continuous evolution of battery technology has led to advancements in energy density, charging speed, and overall performance, contributing to the increased acceptance and viability of electric vehicles as a practical alternative to traditional gasoline-powered cars. For instance, in November 2023, Stellantis N.V., an automotive manufacturer and Contemporary Amperex Technology Co., Limited (CATL), a battery manufacturer for electric vehicles signed a Memorandum of Understanding (MoU) for LFP battery cell supply for Stellantis’ electric vehicle production in Europe.

Furthermore, in November 2022, American Battery Factory Inc. (ABF), a battery cell manufacturer, collaborated with Anovion, an advanced material technology company, to supply LFP battery cells with graphite anode components made in the U.S. The collaboration envisaged Anovion being the preferred supplier for ABF's synthetic graphite anode materials and ensuring that this essential battery component is sourced domestically. The two organizations were looking forward to considering long-term collaborations to increase battery efficiency and optimize the supply chain, extending beyond bolstering the domestic supplier base for LFP battery cells.

As the global focus on sustainability and eco-friendly transportation intensifies, the ongoing advancements in electric vehicle technology are poised to continue reshaping the passenger car market and driving further innovation in the automotive industry. Additionally, the increasing emphasis on personalized driving experiences has propelled the demand for vehicles equipped with advanced infotainment systems that offer customization options tailored to individual preferences. The ability to customize features such as audio settings, climate control, and digital assistant integrations within the vehicle enhances the overall appeal of the car, leading to a rise in consumer interest and, subsequently, an increase in demand for such digitally advanced passenger cars globally.

Passenger Cars Market Report Highlights

• Based on propulsion type, the electric segment is expected to register the fastest CAGR from 2024 to 2030. The growth of electric passenger cars globally can be primarily attributed to advancements in battery technology, driving improved range and affordability, and a growing infrastructure for electric vehicle charging stations.
• The luxury vehicle class segment is anticipated to register the fastest CAGR from 2024 to 2030. The convergence of luxury and technological innovation has positioned these vehicles as symbols of modernity and sophistication, driving the sustained demand observed across the global luxury car market.
• Based on car type, the sedan segment is anticipated to register the fastest CAGR from 2024 to 2030. The growing emphasis on safety and advanced technological features has prompted many consumers to opt for sedans, as these vehicles often incorporate the latest safety innovations and cutting-edge infotainment systems.
• Asia Pacific is expected to register the fastest CAGR from 2024 to 2030. The growth of passenger cars in Asia Pacific can be primarily attributed to rising urbanization, increasing disposable incomes, and a growing middle class, coupled with a shift in consumer preferences for personal mobility and convenience. Additionally, government initiatives promoting the development of infrastructure, such as improved road networks and favorable policies, have further fueled the expansion of the regional market.
• The global passenger car market remains competitive, characterized by the dominance of key players such as Tesla, Inc.; Toyota; Volkswagen; General Motors; and Ford Motor Company. These industry leaders face intensifying competition from emerging electric vehicle manufacturers such as Tesla and NIO, prompting a shift towards sustainable and technologically advanced offerings to meet evolving consumer preferences and stringent environmental regulations.
• In July 2023, BYD Co. Ltd’s Denza brand revealed a N7 electric SUV. The Denza N7 is a mid-size, five-seater SUV that is positioned as a premium offering in the Chinese electric car market. The N7 is available in two versions namely a single-motor rear-wheel drive model with a range of 540 km (336 miles) and a dual-motor all-wheel drive model with a range of 630 km (391 miles). Both versions use BYD's Blade Battery, which is known for its safety and long lifespan.

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