ANNUAL REPORT 2021

MARKET REPORT

The global automotive sector will grow continuously in the coming years, although the speed and quality of growth will vary from region to region. Short-term economic fluctuations are also to be expected. Electrification and digitization will continue to gain momentum – with the corresponding shift in value creation.

The initial phase of the pandemic hit the automotive industry particularly hard, but a gradual trend toward recovery was evident in many markets shortly thereafter. By the second half of 2020, for example, 76 percent more new cars were sold in China than in the first three months of the year. In Japan, this figure stood at four percent, in the United States at 11 percent, and Europe lagged behind with one percent more newly registered vehicles. Then, in 2021, the situation developed in which supply could no longer keep up with demand. The entire automotive sector was hit by the global shortage of computer chips, which led to a significant drop in sales in the second half of the reporting period; millions of vehicles couldn’t be completed and sold.

Even though sales have declined in the recent past due to various factors mentioned above, we can assume that the automotive market will grow in the coming years, with the pandemic accelerating certain developments in the automotive sector. Consumers around the world seem to have rediscovered or redeveloped an appreciation for individual means of transportation, with their own car being the preferred way to get around because of its (health-related) safety and convenience.

Investments in e-mobility will shape the future of the automotive industry

The transformation toward e-mobility has also received a boost. Of 100 million vehicles sold worldwide in 2030, 70 percent will be powered by an internal combustion engine, with hybrid drive systems in turn accounting for around two-thirds of this figure. This means the breakdown of vehicles on our roads in 2030 by drivetrain is likely to be as follows: 45 percent of cars will have hybrid engines, 25 percent will be powered solely by internal combustion engines, and 30 percent will be powered by a battery or fuel cell. Overall, it is safe to assume that the trend toward all-electric drive systems will not only stabilize but accelerate even further. Over the long term, the all-electric drives will displace hybrid drives from the market, in some regions sooner, in others somewhat later. This trend is still subject to certain risks however – electricity price increases, the as yet insufficient level of electricity generated from renewable sources, the lack of charging infrastructure, and the excessively high prices for EVs – all of which could put the brakes on the expected growth.

On the one hand, therefore, components for vehicles with combustion engines (hybrids and vehicles powered solely by combustion engines) will continue to be needed for many years to come, albeit with declining market shares. On the other hand, the demand for components for all-electric drive systems has already reached a considerable level, with a strong upward trend. This means that OEMs need suppliers who can both offer a reliable supply of components for combustion technology and master the technologies needed for the electric-powered future. Feintool can do both and is therefore perfectly prepared for the changes ahead.

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