TELEMETRY STUDY PREDICTS SLOWER GLOBAL AUTO SALES GROWTH THROUGH 2035
- Craig Daitch
- 6 days ago
- 3 min read
Demographic and Propulsion Changes, Affordability and Wildly Uncertain Trade Policy Suggest Uneven Growth in Advanced Economies
NOVI, Mich., April 7, 2025 — Think the auto industry is hypercompetitive in 2025? You might want to buckle up.
According to Sam Abuelsamid, a globally recognized automotive industry analyst and Vice President of Market Research at Telemetry, massive demographic and economic changes — and a fair degree of trade policy uncertainty — will vex automaker product planners, especially on powertrain choices over the next ten years.
“The auto supply chain disruptions from COVID-19 couldn’t have been predicted,” said Abuelsamid. “But our analysis shows a fair measure of predictability considering regional population changes, affordability challenges and anticipated changes along a continuum of electrification, all of which will play out differently in major global markets. Trade policy and its consequences — including recent tariffs — remain the wild card.”
All of this has come against a backdrop of the industry investing hundreds of billions of dollars to transition from the internal combustion engine (ICE) that has dominated for most of the past 140 years.
Global Light-Duty Vehicle Forecast for 2025 Through 2035
This is the context of this analyst report, in which Telemetry’s Abuelsamid forecasts light-duty vehicle (LDV) sales from 2025 through 2035. The forecasts are split up by powertrain configuration — including ICE, hybrid (HEV), plug-in hybrid (PHEV), extended-range electric vehicle (EREV), battery-electric vehicle (BEV) and fuel-cell electric vehicle (FCEV) — across eight global market regions with quantitatively modeled base, conservative and aggressive scenarios.
The forecast model starts from historical global sales data from 2012 to 2024, broken down by region and powertrain. The forward-looking forecast model considers environmental regulatory policies, market trends, population forecasts, the potential impact of trade policies, charging infrastructure and other factors in each region. Each region is evaluated independently, and the types of vehicles prevalent in each market play a role in determining the probable propulsion adoption rates.
The Factors Multiplying Global Auto Sales Uncertainty
Heading into the second half of the decade, product planning becomes more complicated as government policies that have driven electrification are being upended unevenly across markets, and the cost of BEVs has remained stubbornly high. Automakers that had planned to sunset the development and production of ICEs are having to reverse course and continue investing in traditional technologies while also expanding efforts along a continuum of intermediate electrification, including HEVs, PHEVs, and EREVs.
More challenging is that several enormous regional markets like China and Europe are beginning to lose total population. Even though electrified vehicles have come down in price with the advent of newer, cheaper technologies, base vehicles have become more expensive in North America, Europe and advanced Asian markets with the addition of added safety, fuel efficiency and connected-vehicle components and software.
The Wild Card: The Fallout of U.S. Mercantilism
Complicating planning is the sudden re-emergence of mercantilism. In a throwback to late 19th-century U.S. President William McKinley, recent U.S. trade policy is leaning heavily on tariffs on most imported goods, including those from long-time trading partners and geographic neighbors such as Canada and Mexico.
The imposition of 25% tariffs on products crossing the borders between the U.S., Canada and Mexico is projected to lead to significant retail price increases and corresponding drops in sales. While the automotive industry may respond by shifting production between the three countries, that will take several years and add billions of dollars in unplanned costs. The resulting loss of economies of scale and disruption will also cause retail prices to increase, at least in the short term.
To learn more and order the full report, visit the dedicated landing page at www.telemetryagency.com/2025-light-duty-vehicle-report. The purchase includes an enterprise-wide license and a one-hour live briefing with Abuelsamid; specific questions may be submitted in advance of the briefing.
Contact us at hello@telemetryagency.com for more information.
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