Automotive Industry in 2024: Predictions vs. Reality

Table of content

1. Introduction: Where We Are?
2. RSB: Adapting to 2024 Changes
3. Electrifying Electrification: Expected Growth vs. Actual Slowdowns
4. Connected Vehicles: The Internet of Things on Wheels
5. Software: The New Heart of Cars
6. Urban Mobility: New Behaviors and Opportunities
7. Online Shopping: Revolutionizing Car Buying
8. Conclusion: Visions and Challenges

Introduction: Where We Are?

The automotive industry is a constantly evolving landscape of innovations and challenges. At the beginning of 2024, on our RSB LinkedIn profile, we posted technological and business predictions for the whole year. Our predictions were based on various market trends and technological advancements in 2023. Let’s go through them after nine months to see which forecasts proved accurate and which ones are still waiting for their moment. Buckle up as we embark on a journey through the world of automotive predictions and reality!

RSB: Adapting to 2024 Changes

As an part of the team at RSB Automotive Consulting, a firm deeply involved in cutting-edge automotive technology, we’ve had front-row access to these industry shifts. Our firm has worked extensively on key areas like Advanced Driver Assistance Systems (ADAS), electric powertrains, and systems engineering, allowing us to gauge how the sector has responded to both the challenges and opportunities that 2024 presented.

Electrifying Electrification: Expected Growth vs. Actual Slowdowns

Predictions: We were told that electric vehicles (EVs) would dominate the roads, making every journey quieter, greener, and more economical. By 2030, 30% of all cars were expected to be electric, with falling battery prices fueling this trend.

Reality: Reality, as often happens, surprised us. EV sales are growing, but not as rapidly as anticipated. Current data suggests that EV adoption is accelerating, though it may not yet fully meet the earlier optimistic expectations globally.

In the first quarter of 2024, global EV sales are expected to rise by around 20%, reaching about 17 million units, a notable increase from the previous year. China is a major contributor to this growth, expected to account for around 10 million of these sales.

In Europe, the growth is more modest. EV sales are projected to reach about 3.5 million units in 2024, reflecting a less than 10% increase compared to 2023. Although EVs are expected to make up roughly one-fourth of all car sales in Europe, the growth rate is slower than in other regions. In the United States, EV sales are forecasted to grow by 20%, adding about half a million units, with plug-in hybrids seeing a more significant boost of 50%.

Despite these gains, several challenges remain for widespread EV adoption. High interest rates, economic uncertainties, and changing regulations could slow down progress. However, rapid expansion into new markets and growing competition among automakers might speed up adoption, potentially exceeding early predictions. The shift towards an electric future is underway but is moving at a slower pace than originally anticipated.

Connected Vehicles: The Internet of Things on Wheels

Predictions: Imagine a world where our cars talk to us – informing us about oil changes, suggesting routes to avoid traffic, and even playing our favorite playlists. The development of 5G and IoT is set to make this a reality. With these technologies, vehicles will not only provide real-time diagnostics and personalized navigation but will also seamlessly integrate with smart city infrastructure to enhance overall efficiency and convenience. As these innovations unfold, they promise to transform the driving experience into a highly interactive and intuitive journey.

Reality: This is already happening! The collaboration of tech giants like Google and Ford shows that connected vehicles are no longer a thing of the future, but the present. Cars equipped with artificial intelligence are becoming the norm, and we are starting to treat them like our digital assistants on wheels.

Here are some key aspects:

• Internet Connectivity and Data Sharing
• Advanced Navigation and Smart City Integration
• Safety Features
• Entertainment and Convenience
• Data as a Product

Just as we were tentatively stepping into the world of Industry 4.0, we’re already moving into its enhanced version—Industry 5.0. This new phase in the automotive industry focuses on blending human creativity with advanced technology. Industry 5.0 takes personalization to unprecedented levels, allowing vehicles to be finely tuned to each owner’s unique preferences. By integrating AI and robotics with individual needs, cars are becoming more innovative and tailored. While sustainability remains important, the primary goal now is to deliver exceptional, customized experiences that truly resonate with every driver.

Software: The New Heart of Cars

Predictions: Software was predicted to become the backbone of modern vehicles. The expectation was clear: software would be central to managing complex safety systems, ensuring higher quality performance, and navigating the increasingly stringent regulatory landscape. As cars became more connected and autonomous, these predictions emphasized that traditional hardware alone wouldn’t suffice—the future of driving would depend on the seamless integration of advanced software to meet these evolving demands.

Reality: It truly is the heart of our cars. In line with predictions, automotive manufacturers are investing massive resources into software development. This shift is evident not only in growing in-house teams but also in strategic partnerships with tech companies. Software is central to ensuring cybersecurity, vehicle safety, and regulatory compliance. The complexity of these systems is growing exponentially, making collaboration with IT sectors essential for the industry’s future.

A clear indicator of this trend is the increasing number of events like the Software Defined Vehicles conferences. These events bring together experts to discuss the next steps for vehicles where software dictates performance and behavior. However, this evolution raises important questions: Are we moving in the right direction? The focus on software-defined systems is undoubtedly exciting, but is there a risk that we are pushing too far too fast? The growing interdependence between traditional automotive manufacturers and tech companies brings great potential, but it also opens doors to complexities that might be hard to manage.

One could ask whether the automotive industry, by putting so much emphasis on software, is heading towards a situation where cars become more like mobile devices—frequent updates, potential cyber vulnerabilities, and constant need for maintenance. While innovation is inevitable, it is crucial to ensure that we questioning the possible long-term consequences of this software-centric approach.

Urban Mobility: New Behaviors and Opportunities

Predictions: It was expected that an increasing number of city dwellers would gradually give up owning personal cars in favour of more convenient smart mobility solutions, such as car-sharing services (the practice of renting cars for short periods of time, often through an app) and various forms of micro-mobility (small, often electric vehicles like scooters or bikes designed for short-distance travel).

Reality: This trend is proving true. Car-sharing has indeed gained popularity, especially in urban areas. According to recent data, the global car-sharing market is expected to grow significantly, with Europe being one of the leading regions. Many cities have integrated car-sharing services into their public transport systems, making it easier for residents to access these services.

The rise in popularity of electric transportation is significant. Micromobility is becoming the norm, especially in crowded and polluted cities. People are increasingly looking for more sustainable forms of transport and are finding them in these modern solutions. It doesn’t seem like this trend will slow down anytime soon.

Even though RSB is fundamentally focused on cars, it’s hard not to notice that on our way to the office in Cracow, we’re increasingly encountering not just traffic jams but also poorly parked scooters, electric bikes, and other more inventive short-distance transport options

Online Shopping: Revolutionizing Car Buying

Predictions: It was widely anticipated that the trend of online car shopping would experience significant growth, fundamentally altering the traditional dealership model. This shift was expected to lead to substantial changes in how vehicles are sold and purchased, transforming the established practices of in-person dealership interactions.

Reality: In 2024, the automotive industry has indeed seen a significant transformation due to the rise of online car shopping. The predictions have largely come true, with several key developments reshaping the car buying experience:

• Virtual Showrooms: Explore cars from home with AR and VR, checking out features and taking virtual test drives without visiting a dealership.
• Convenience and Transparency: Browse, compare, and buy vehicles online with detailed specs, high-resolution images, and clear pricing. Access to vehicle histories and customer reviews helps make informed decisions.
• Streamlined Financing and Delivery: Digital platforms simplify financing and speed up delivery, enhancing the overall efficiency of the buying process.
• Innovative Competition: The rise of online sales has pushed dealerships to innovate with advanced digital services, offering better choices and deals.
• Data-Driven Insights: Online data helps brands personalize their marketing and offerings, improving the customer experience.

All in all, online sales are gaining popularity. More and more manufacturers are offering their models directly online, reducing time spent in showrooms and increasing convenience for buyers. Traditional car dealerships are becoming a thing of the past. This trend seems unstoppable—just take a look at the chart below!

Conclusion: Visions and Challenges

In 2024, the automotive industry is navigating a delicate balance between dreams and reality. Electrification is advancing, albeit slower than anticipated, while connected vehicles and intelligent systems are becoming increasingly mainstream. The focus in autonomous driving is on achieving Level 3 autonomy. Software has emerged as the backbone of modern vehicles, and online car buying is transforming the sales landscape. At the same time, urban mobility is evolving with a rise in car-sharing and micro-mobility solutions. The coming months promise further innovations that will shape the future of transportation. As Henry Ford once said, “Failure is simply the opportunity to begin again, this time more intelligently.” It’s time to discover what the future holds for the automotive world!

Predictions for 2024 were drawn from the following industry articles:
Global Automotive Market: Predictions For 2024
Automotive industry forecasts and challenges in 2024 | Knauf
Trends in the automotive industry in 2024

Other sources:
Trends in electric cars – Global EV Outlook 2024 – Analysis – IEA
Automotive Industry 5.0: Innovation and Balance for the Future
Autonomous (Driverless) Car Market Insights
New EU rules to improve road safety and enable fully driverless vehicles in the EU
www.automotive-iq.com/events-sdv-software-defined-vehicles-europe/agenda-mc
Micro-mobility Market Size to Hit USD 11.83 Billion by 2032
Revolutionizing Car Shopping: Virtual Showrooms in the Automotive Industry
The Rise Of Online Car Buying: How E-Commerce Is Revolutionizing The Automotive Industry
Online Car Buying Market Size, Trends, Forecast [2032]