2021 was a historic year for the automotive industry, following the unprecedented disruption of 2020’s COVID-19 pandemic and more than a decade of responding to CASE megatrends; connected cars, autonomous vehicles, shared mobility, and electrification.
Hopes were high in the first half of the year that production and sales would achieve an impressive recovery from the depths of the pandemic. Consumer spending remained strong and demand for vehicles was robust, but rough seas lay ahead as shortages of semiconductor-based components began to bite. In short order, many automakers found themselves unable to secure parts to power their advanced driver-assistance systems (ADAS), infotainment systems, and other onboard electronics. This led to lost production as automakers rationed what little chip supplies they still had across their most profitable models.
The vehicle manufacturing sector scorecard provides a top-down, comprehensive outlook for the major players in the automotive industry over the next two years, based on the key themes that are set to transform their market.
Demand for Li-ion batteries has risen sharply, driven by accelerating EV production. Battery producers are launching multi-billion-dollar ‘gigafactories’ to supply cells to automakers. Cathode choice is playing a key role in battery development, with two varieties accounting for most deployments. Most EVs currently use nickel-cobalt chemistries, which offer great energy density and range. However, lithium iron phosphate (LFP) has emerged as an alternative and is widely utilized by Chinese players. It offers slightly less energy density but counters improved cost, safety, and lifecycle performance. LFP also omits cobalt—a financial and ESG concern due to the risk of illicit mines using child labor.
Autonomous Vehicles (AVs)
A host of tech and auto companies are racing to deliver autonomous vehicles—capable of making journeys with little or no human input. Many OEMs are introducing semi-autonomous and automated driver assist (ADAS) functions including auto-braking, lane departure, and blind-spot warning. Tesla, Ford, and Cadillac have all deployed Level 2 systems with driver supervision. Honda currently has the only Level 3 (eyes off) system with regulatory approval, which can autonomously manage stop-start traffic without supervision.
Internet of Things (IoT)
The fundamental purpose of the internet of things (IoT) is to connect various computer-controlled devices to enable them to communicate with one another. This enables efficiencies by allowing the analysis of data from these various devices. The past decade has seen radical improvements in the range of phenomena that can be sensed and reported by IoT devices. More importantly, however, design innovations have driven the cost of sensors down, allowing more devices to be brought into the IoT network, enabling further efficiency improvements.
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Market report scope
|Key themes||Lithium-ion Batteries, Autonomous Vehicles (AVs), and the Internet of Things (IoT)|
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The key themes that will impact the automotive industry in 2022 are lithium-ion batteries, autonomous vehicles, and the internet of things.