Light Duty Vehicle Market

Light Duty Vehicle Market Size (2023 - 2028):

The Global Light Duty Vehicle Market was worth US$ 564.07 billion in 2022 and is anticipated to reach a valuation of US$ 808.75 billion by 2028 and is predicted to register a CAGR of 6.45% during 2023-2028.

Demand for light vehicles is expected to increase due to less air pollution caused by these vehicles. Additionally, stringent regulations to reduce vehicle emissions are expected to drive the adoption of electric light trucks and thus drive market growth during the forecast period. Light vehicles tend to emit lower volumes of atmospheric pollutants and, therefore, are the preferred vehicle for the transport of people and goods.

A vehicle that uses two or more different fuel sources to operate and move the vehicle is called a hybrid vehicle. This term often refers to hybrid electric vehicles, which fuse one or more electric motors into an internal combustion (IC) engine. Light commercial vehicles are used primarily for urban transportation or as personal vehicles. Current hybrid light vehicle designs are an extension of electric vehicles. At the current stage of development, electric vehicles do not offer long-range on a single charge. Also, vehicles that run on biofuel have limited power. Mild hybrids offer an advantage over these problems and provide more power and good range at the same time.

Market Drivers:

Automotive suppliers are increasingly deploying light vehicles equipped with fleet security, navigation, and tracking capabilities. Recent developments in sensor technologies, location-based services, and analytics are supporting the growth of light autonomous vehicles. The proliferation of IoT has enabled the integration of telematics systems, such as fleet telematics to track light vehicles, into automobiles. This later enabled the development of driverless passenger cars and autonomous rental cars. Another important factor contributing to the growth of the light-duty vehicle market is the growing trend to offer dynamic shuttles as part of on-demand passenger services.

Market Restraints:

One of the main factors hampering the growth of the light-duty vehicle industry is the rising raw material costs.

Market Recent Developments:

• Fiat Chrysler and Waymo have signed an exclusive agreement to develop autonomous utility vehicles, an area that some belief may be the first widespread use of autonomous technology.

• Daimler Trucks & Buses, one of the largest commercial vehicle manufacturers in the world, follows a sustainable corporate strategy and aims to offer only new vehicles that are CO2 neutral when driving ("tank to wheel") in the European Markets, Japan, and NAFTA by 2039.

• The BMW Group is accelerating its boom in electric mobility and setting new standards for industry transformation with its production.

LIGHT DUTY VEHICLE MARKET REPORT COVERAGE:

Market Segmentation:

Light Duty Vehicle Market - By Vehicle Type:

• Passenger Car
• Van
• Sports Utility Vehicle (SUV)
• Pickup Truck

The passenger car segment accounted for 28% of the market share in 2019, driven by the increasing adoption of passenger cars by established operators in the tourism industry. The growth in this segment is attributed to the increasing adoption of passenger cars by established operators in the tourism industry. In addition, the governments of several countries have enacted regulations that have led passenger car manufacturers to produce efficient and low-emission vehicles, putting considerable pressure on them to engage in research and investigation.

Light Duty Vehicle Market - By Fuel Type:

• Diesel
• Gasoline
• Hybrid
• Electric

Of all the main types of fuels for light vehicles, the gasoline segment had the largest share, with 57% in 2019. In fact, gasoline vehicles emit less emissions than diesel vehicles and can also be purchased at an affordable price. However, the electric segment is estimated to record the highest CAGR of around 14.3% during the foreseen period due to growing demand for high-performance, zero-emission vehicles. Technological advancements, along with proactive government initiatives to reduce vehicle emissions, are fostering the development and adoption of electric vehicles and the deployment of charging infrastructure for electric vehicles, thus driving the growth of the electric segment.

Light Duty Vehicle Market - By Transmission:

• Manual
• Automatic

The manual segment dominated the market in 2018. The manual transmission is more fuel efficient and typically uses 5% to 10% less fuel compared to the automatic transmission. Manual transmission vehicles also tend to be less expensive than their automatic transmission counterparts. Additionally, there has been a significant increase in demand for vehicles with a clutch-less manual transmission, eliminating the need for the clutch pedal that the driver must press before shifting gears.

Light Duty Vehicle Market - By Drivetrain:

• Front Wheel Drive (FWD)
• Rear Wheel Drive (RWD)
• Four Wheel Drive (4WD)
• All-Wheel Drive (AWD)

Rear-wheel drive is the most preferred type of transmission and is commonly found in passenger cars. The rear-wheel drive helps improve traction and balance the vehicle. These advantages combined with the rear-wheel drive are promoting the expansion of the segment.

Market Regional Analysis:

The Global Light Duty Vehicle Market Report includes the segmentation of regions:

• North America - U.S, Canada
• Europe – Norway, Germany, Sweden
• Asia Pacific- China, India, Japan
• Latin America – Brazil, Mexico, Argentina
• Middle East and Africa

North America led the market in 2019 with a 39% share due to the growing adoption of electric vehicles in line with government initiatives promoting the development and adoption of electric vehicles and the deployment of infrastructure charging electric vehicles. Europe accounted for a significant market share in 2018 due to the increasing adoption of light trucks for inland freight transport in Europe, where the majority of freight transport is carried out by road. According to Eurostat, more than 75% of national freight transport within the EU, or around 1.75 billion tonne-kilometers (km), is carried out by road. On the other hand, initiatives by car manufacturers in the region to establish new car-sharing platforms are stimulating demand for passenger cars. However, due to developments in the e-commerce industry, especially in China, India, and Japan, Asia-Pacific is expected to become the fastest-growing regional market with a CAGR of around 16.2% during the conjecture period. Strict regulations to reduce vehicle emissions are also supposed to drive demand for light-duty vehicles in the Asia Pacific.

IMPACT OF COVID-19 ON THE LIGHT-DUTY VEHICLE MARKET:

The automotive industry forecasts a loss of 7.5 lakh of production units and $ 2 billion in revenue in March 2020 alone due to closings to combat the coronavirus transmission. Despite the difficult business environment, several automakers have not fired any permanent or temporary workers. Production is nearly stagnant as provincial governments have imposed lockdowns and companies closed their factories to help break the chain of the coronavirus pandemic.

Market Key Players:

1. BMW AG
2. Daimler AG
3. Fiat Chrysler Automobiles N.V.
4. Ford Motor Company
5. General Motors Company
6. Honda Motor Company, Ltd.
7. Hyundai Motor Company
8. Nissan Motor Company, Ltd.
9. Subaru Corporation
10. Toyota Motor Corporation