by The Automotive Assembly Market is estimated to be valued at US$ 41,490 Mn in 2022 and is expected to exhibit a CAGR of 5.80% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Automotive assembly involves fitting various vehicle components together such as engine, transmission system, electrical components, chassis etc. to form a complete automobile. It provides mobility solutions and facilitates transportation of goods and people. Growing vehicle production to cater to the rising demand is driving the automotive assembly market.
Market key trends:
One of the major trends driving the growth of the automotive assembly market is rising demand for luxury and premium vehicles. Luxury and premium vehicles offer comfortable driving experience with additional features compared to other conventional vehicles. Also, higher disposable income and changing lifestyle and consumer preference are major factors increasing sales of luxury cars globally. Rising affluence in developing countries such as India and China is creating huge demand for luxury vehicles in these markets. According to JATO Dynamics, global sales of luxury cars grew by 22% in the first quarter of 2022 as compared to previous year. This increasing demand for luxury vehicles worldwide is expected to boost automotive assembly activities over the coming years.
Porter’s Analysis
Threat of new entrants: The automotive assembly industry requires huge capital investments and economies of scale to operate efficiently which poses significant entry barriers for new players.
Bargaining power of buyers: Buyers have moderate bargaining power due to the presence of several automotive assembly companies offering similar products in the market. Switching costs are also low for buyers.
Bargaining power of suppliers: Suppliers have moderate bargaining power due to dependence of assembly companies on suppliers for key raw materials and components. However, there is a threat of forward integration by assembly companies.
Threat of new substitutes: There is low threat from substitutes currently but electric vehicles are emerging as a potential substitute in the long run.
Competitive rivalry: High competitive rivalry exists among existing players due to presence of few large players globally.
SWOT Analysis
Strength: Established global production and supply chain network, research & development capabilities, brand reputation.
Weakness: High fixed costs, vulnerability to economic cycles, stringent emission regulations.
Opportunity: Growing demand for electric and hybrid vehicles, emerging markets offering new opportunities.
Threats: Trade disputes and geopolitical tensions, driverless technology disrupting industry.
Key Takeaways
Global Automotive Assembly Market Demand is expected to witness high growth, exhibiting CAGR of 5.80% over the forecast period, due to increasing demand for personal vehicles in emerging economies. The market was valued at US$ 41,490 Mn in 2021.
The US dominates the automotive assembly market owing to presence of domestic automotive giants and increasing automobile sales. However, China is emerging as the fastest growing market in Asia Pacific due to massive production hubs of Chinese automakers coupled with rising middle class population.
Key players operating in the automotive assembly market are BMW Group, Daimler, Ford Motor, General Motors, Honda Motor, Hyundai Motor, SAIC Motor, Stellantis, Toyota Motor, Volkswagen Group, and others. Major players are focusing on expanding EV portfolio and integrating advanced technologies to strengthen their market position.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
