Asia Will Be Responsible for More Than Half of Car Sales by 2025

An analysis of the Asian automotive market predicts that more than half of the world's car sales will come from continental Asia by 2025. Asian car sales are expected to increase by about 5% a year over the next 12 years. 

China and India will be the two juggernauts of the Asian market over the next 12 years. Chinese auto sales are expected to double in that time to 40 million cars sold a year. It will control 30% of the global vehicle marketplace alone. In the near term, China and India are expected to build about the same number of cars annually as North America.

However in the near term, Indian car sales will increase at a faster rate than China and annual sales are set to quadruple by 2025. India is expected to control 11% of the global car market by that time. 

Car sales in established markets are expected to grow but at a slower rate over the next 12 years. Europe is expected to increase by 3% a year; North America will grow by 2% a year, and Japan and South Korea will grow by 1% a year. 

The question becomes how should established automakers react to these changes in the market, and it appears that there are two likely outcomes.

The first possibility is that cars will become more specialized to their markets. If growth outside of Asia is so slow automakers could focus on creating cars for their established customers. At 1% or 2% annual growth, it might be difficult for Chinese automakers to break into the North American or Japanese markets. The established automakers could choose to ignore China and plan for the lower growth. 

The other option is that Chinese-oriented cars could take over the world market. Not only are established automakers racing to grab a piece of the Chinese market, Chinese automakers are working to break into outside markets. If the high production and low cost model that has worked so well in Chinese-made consumer goods was applied to cars, China could undercut established automakers and offer cheap cars around the world. 

Where do you think the future of cars will be?

Source: Auto, Motor und Sport