What Lies Ahead for Electric Cars in 2025?

Beijing, December 20, 2024 – The automobile industry continues to witness stable growth, prominently marked by significant strides in the electric vehicle sector. The collaboration between technology companies and traditional car dealers is creating dazzling advancements, fostering a mature landscape for smart mobility solutions. These developments are generating expansive market opportunities amidst challenges.

IDC has forecasted the automobile market trends for 2025 based on recent advancements in technology and the evolution of the Chinese car market. The key insights are as follows:

Insight 1: Mobility Services Lead to Market Innovation

As the passenger car market in China transitions, traditional models of providing services based on single car VINs are evolving to service frameworks centered around an owner’s lifestyle. The rise of smart driving technology is facilitating this shift, with notable innovations such as Baidu's city-scale autonomous service in Wuhan and Tesla's significant focus on its autonomous fleets. Car dealers are increasingly pivoting from luxury brands to technology-driven EV brands, infusing new energy into the automobile business models supporting transportation fleets.

Insight 2: Expansion of Advanced Driver Assistance Systems (ADAS)

With the increasing urban coverage of advanced driving assistance features, fragmented functions in highways, loops, and parking are being integrated, enhancing the comprehensiveness of these systems. High user engagement with mature systems indicates their entrenched utility, accelerating the integration of edge-case scenarios and driving forward ADAS evolution.

Insight 3: Growth of New Energy Vehicles (NEVs)

With advancements in high-pressure fast-charging and semi-solid battery production, the limitations of battery cars are receding. The flexibility of battery designs is growing, allowing manufacturers more creativity in addressing issues like battery life. Efforts are being made across major battery manufacturers to develop and expand on hybrid and range-extended electric vehicles. IDC predicts that by 2025, the market for new energy cars in China will reach nearly 14 million units.

Insight 4: Rise of Plug-In Hybrid Vehicles in the NEV Market

As a critical transitional phase in the electrification of automobiles, plug-in hybrids are expected to deliver exceptional growth in the new energy car sector by 2025. The evolving chassis control systems are bridging functional gaps between traditional cars and EVs, smoothing the transition for gasoline car consumers.

Insight 5: Range-Extended Electric Cars Opening New Market Segments

Occupying a prominent position in the high-end SUV market, range-extended electric vehicles are influencing consumer perceptions and validating their technological viability. Brands like Xpeng and Zhiji have announced plans for range-extended models by 2025, ensuring a significant presence across various body styles and price ranges.

Insight 6: Enhanced Technology in the Pure Electric Market

The competitive landscape among new energy car producers is not only steering the market towards leading firms but also reshaping pure electric vehicle (EV) use cases. Tech companies are increasingly driving this momentum. Xiaomi’s promising entry into the sedan market and its plans to expand into SUVs by 2025 highlight this trend. Consumer perceptions of cars are shifting from merely transportation tools to comprehensive mobility spaces.

Insight 7: Growing Influence of Rear Entertainment Features

Consumer interest in the entertainment capabilities of electric vehicles is influencing buying decisions. Factors like in-car entertainment systems, vehicle space, and seating comfort are becoming more pivotal, emphasizing a shift in focus from driver to passenger-centric experiences.

Insight 8: Innovation in Multi-Modal In-Car Interaction

The integration of gesture and voice recognition technology signifies an evolution in human-vehicle interaction, now expanding to account for emotional and health metrics. Multi-modal interactions centered around voice technology cater to diverse user needs, with penetration rates of voice interaction features at 85% in 2023 and expected to grow further.

Insight 9: eVTOLs Poised for Growth

The development of eVTOL aircraft by both traditional and new automobile enterprises hints at a promising future for low-altitude transportation. As market trials begin in multiple cities by 2025, these vehicles will enrich the tapestry of future mobility solutions.

Insight 10: Strengthening Global Supply Chains

Following China’s significant achievements in automobile exports, Chinese manufacturers are cultivating diversified international strategies, including parts exports, overseas factory setups, and deep collaborations with global car dealers. Such global integration efforts are set to reinforce the resilience of supply chains, promoting enhanced global coordination.