With consumers increasingly prioritizing environmental performance when
purchasing vehicles, automakers must focus on reducing emissions and
developing more sustainable transportation options. Most car buyers now
consider a vehicle’s environmental impact before purchasing, with many willing to
pay a premium of over £2,000 for greener emissions.
Luxury Car Brands See Growth in 2023
The Luxury Cars market had a value of USD 409,263.47 million in 2022,
according to Market Watch. Recent trends in automobile industry help various
projects grow, they need to grow at a CAGR of 9.15 percent during the forecast
period, with an estimated value of USD 691,878.75 million by 2028.
Luxury car brands are experiencing growth due to increased tangible luxury
offerings and rising disposable incomes. The demand for sustainable and eco-
friendly transportation, like electric luxury vehicles, also drives market growth.
The adoption of pre-owned luxury cars is increasing due to easy access to
financing and lower entry prices. Manufacturers are investing in innovative
mobility technologies, such as personal voice assistance, autonomous driving,
and AI and ML, creating a positive market outlook.
Automotive Sourcing Models are Changing
The car market trends are shifting towards regional suppliers to diversify their
supply chains and mitigate risks. This trend is driven by increasing demand and
supply chain disruptions. OEMs seek alternative sources to improve sourcing
flexibility and bring products to market faster. The U.S. and China trade war has
also influenced the search for alternative sourcing options. Labor costs are
another factor in the rise of local sourcing, with countries such as Taiwan,
Cambodia, and Laos providing a lower-cost labor alternative to China.
In addition, assembling a car involves a massive number of parts (30,000 on
average), with materials accounting for a significant portion (40-50 percent) of the
manufacturing cost. To maintain cost competitiveness, automotive procurement
teams must be critical in managing supplier networks and supply chains for
existing and upcoming vehicle models. This includes aligning new technologies
and business models with the company’s vision.
