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The market restarts with SUVs and electrified

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ROMA – For the world car market, the recovery in 2021 will be stronger than expected: sales of cars and light vehicles will reach 83 million, a net recovery compared to 77 million in 2020 (+ 8.5%), to reach 94 million in 2025 and return to the volumes of 2017.

But while in China the market will already exceed the levels of 2019 this year, in the US the full recovery will take place in 2023, while in Europe a return to the levels of 2019 is not expected in the next five years. In Italy, sales should reach 1 , 7 million in 2021 (1.5 in 2020), and then rise to 1.9 million vehicles in 2025, about 0.2 million fewer than before the pandemic.

This is what AlixPartners’ Global Automotive Outlook 2021 reveals, which also shows the confirmation of the European primacy on electrified cars, estimated at a market share of 29% (17% full electric and 12% hybrid plg-in) in 2025. and 42% in 2030 (32% full electric and 10% plug-in), against 19% in China in 2025 (17% full electric and 2% plug-in) and 36% in 2030 (34% full electric and 2% plug-in). In the world, on the other hand, forecasts are for a share of 11% of full electric and 4% of plug-in in 2025 and of 24% of full electric and 4% of plug-in in 2030. Italy also confirms the race , with a market share of electrified cars that will rise from 17% in 2020 (2% full electric and 15% plug-in) to 18% in 2025, but with an inverse ratio between full electric (13%) and plug-in ( 5%). Trend that will continue until 2030 (24% full electric and 4% plug-in).

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Despite the remarkable progress in draft cars, however, 76% of vehicles globally in 2030 will still have a combustion engine. ” It means – specifies Dario Duse, Managing Director of AlixPartners – that what manufacturers announced in terms of plans for electricity by 2030 will not always be respected. Otherwise, in ten years the share of fully electric vehicles in the world should be 35%, while we believe a share of 24% more plausible ”.

Also because the advent of electrification requires significant changes in the business model of automotive operators, from the need to reconvert the current production plants dedicated to combustion engines, to the revision of the supply chain, also linked to the greater use of internal production of components. and electrical systems that manufacturers are adopting and the strong push towards independence of battery production, which will see Europe self-sufficient by 2022. With regard to the production mix, however, the trend of moving towards SUVs will continue, which in Europe will reach in 2025 45%, to the detriment of the small segments (especially A), which will become increasingly marginal. In Italy, SUVs will also be confirmed as the first segment in 2025, with a 47% share and a growth of 44% in five years.

AlixPartners instead expects a collapse of 81% of segment A, while segment B will remain strong, whose market share will be 26% in 2025, growing by 50% in five years. According to Duse, this fact ” explains the low level of electrification in Italy, given that the largest segments will be the first to convert to electricity ”. In fact, having higher sales prices ensure greater revenues and allow manufacturers to better amortize the growth in raw material costs (+ 90%) and the enormous investments in electrification, estimated by AlixPartners at 330 billion dollars over the next 5 years. Not to mention the $ 300 billion in charging infrastructure that will be needed to support home electrical projects by 2030.

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Despite this, with the increase in electricity production, the profitability of car manufacturers will remain under pressure and, says Duse, ” will reach a positive margin around 2023 for the large segments and between 2027-2028 for the small segments ”. A problem that in Europe could put up to 12% of electric vehicle systems at risk. According to AlixPartners of the 137 current plants, only 134 could remain in 2027 and certainly 34 will have to undergo radical transformations to survive. An issue that will mainly affect component companies which, in the face of the decrease in demand from the houses will increasingly have to turn towards a less mechanical and more software production, oriented towards batteries and electrical systems.


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