Global Automotive Industry Outlook for 2025

Avinash Puri1 day ago

Overview

The global automotive industry is set for a dynamic year in 2025, as S&P Global forecasts a slight decline in global light vehicle production. According to the latest report, production is expected to decrease by 0.4% to 88.7 million units, with an additional 1.6% decline in production levels to 89.1 million units. The primary driver behind this decline is the anticipated tariff regime by the incoming US administration, imposing a universal 10% tariff on all imported goods and a 30% tariff on Chinese imports.

Regional Auto Production Trends for 2025

Mainland China: Stability Amid Global Decline

Despite the global slowdown, Mainland China’s production levels are expected to remain stable, rising slightly by 0.1% to 29.6 million units. Strong domestic demand for New Energy Vehicles (NEVs) and robust exports are key factors driving this growth. However, EU import tariffs on Chinese-made battery electric vehicles (BEVs) could temper overall expansion.

North America: Production Set to Decline

In contrast, North America’s auto production is forecasted to decline by 2.4% to 15.1 million units. The US administration’s trade policies are expected to play a major role in shaping demand and vehicle mix assumptions. Deregulation could provide tailwinds for the industry in the latter half of the administration’s term.

Europe: Adjustments Ahead of 2025 EU Emissions Rules

Europe’s auto production is projected to decline by 2.6% to 16.6 million units, down from an estimated 17.0 million in 2024. Automakers are adjusting propulsion mix strategies to comply with 2025 EU emissions regulations. Additionally, new tariffs under the Trump administration are expected to impact premium vehicle production.

Electric Vehicles: A Key Growth Sector

Despite concerns surrounding electrification, the EV market remains a bright spot. Global sales of battery electric passenger vehicles are expected to surge by 30% in 2025, reaching 15.1 million units and accounting for 16.7% of global light vehicle sales. In 2024, an estimated 11.6 million BEVs were sold, representing a 13.2% market share.

Fastest Growing Auto Stocks to Watch in 2025

Using year-over-year and three-year sales growth as key indicators, we compiled a list of the top auto stocks with the highest growth potential. These include auto manufacturers, auto parts suppliers, and auto dealership companies with a year-over-year sales growth of more than 15% and a positive three-year sales growth. Data was sourced from Finviz, Seeking Alpha, and Insider Monkey’s Q4 2024 hedge fund database.

Lucid Group Inc. (NASDAQ: LCID): A Fast-Rising EV Contender

Year-Over-Year Sales Growth: 35.71%
3-Year Sales Growth: 210.02%
Number of Hedge Fund Holders: 24

Lucid Group, Inc. (NASDAQ: LCID) is an automotive technology company specializing in luxury electric vehicles, EV powertrains, and battery systems. Known for its flagship model, the Lucid Air, the company offers high-performance and long-range luxury sedans that compete with both traditional gas-powered and electric vehicles.

Lucid’s Record-Breaking 2024 Performance

In 2024, Lucid achieved a major milestone, delivering 10,241 vehicles. The Lucid Air emerged as a top-selling EV in its class in the US, outperforming some gas-powered models in the second half of the year. The company’s production aligned with projections, with 9,029 vehicles produced against a target of 9,000.

Lucid’s financials also showed signs of improvement. The company reported fourth-quarter revenue of $234.5 million, with gross margins improving to negative 114% from negative 225% previously. These figures indicate progress toward better financial health and long-term profitability.

Lucid’s Growth Strategy for 2025

Looking ahead, Lucid is focusing on increasing customer deliveries through aggressive marketing and retail expansion. The company is also advancing its technology with hands-free driving capabilities, positioning itself as a leader in autonomous driving innovation. With robust sales growth and strong investor interest, Lucid remains one of the fastest-growing auto stocks to watch in 2025.

Political and Economic Impacts on Auto Stocks

Representative Gilbert Ray Cisneros, Jr. and Ford Motor Stock Sale

In a move that has caught the attention of investors, Representative Gilbert Ray Cisneros, Jr. (D-California) has sold shares of Ford Motor Company (NYSE: F), signaling a potential strategic shift in his investment portfolio. According to a filing disclosed on March 6, Cisneros sold shares valued between $1,001 and $15,000 on February 26. The trade was executed through his “150 MAIN STREET TRUST > BANK OF AMERICA” account.

A Closer Look at Cisneros’ Recent Trades

Representative Cisneros has been actively trading stocks, with recent filings revealing a series of notable transactions across different sectors. His latest moves include:

Purchases:

$1,001 – $15,000 in Sterling Infrastructure (NASDAQ: STRL) on March 3.
$1,001 – $15,000 in Hillman Solutions (NASDAQ: HLMN) on March 3.
$1,001 – $15,000 in Uber Technologies (NYSE: UBER) on February 26.
$15,001 – $50,000 in Microsoft (NASDAQ: MSFT) on February 26.
$1,001 – $15,000 in Tesla (NASDAQ: TSLA) on February 26.
$1,001 – $15,000 in Dollar General (NYSE: DG) on February 26.

Sales:

$15,001 – $50,000 in UnitedHealth Group (NYSE: UNH) on February 26.
$1,001 – $15,000 in General Motors (NYSE: GM) on February 26.
$1,001 – $15,000 in Akamai Technologies (NASDAQ: AKAM) on February 26.
$1,001 – $15,000 in Danaher (NYSE: DHR) on February 26.

These transactions suggest a diversified investment approach, with a focus on infrastructure, healthcare, technology, and consumer goods.

Ford Motor Stock Performance and Analyst Sentiments

Ford Motor’s stock has been gaining traction, with shares trading up 3.1% at $9.91 as of Friday. The auto manufacturer has been navigating market fluctuations with a 52-week range between $9.06 and $14.85. Currently, Ford has a market capitalization of $39.26 billion, a P/E ratio of 6.78, and a dividend yield of 6.06%.

Institutional Activity in Ford Motor Stock

Institutional investors continue to play a significant role in Ford’s stock dynamics. Recent activity includes:

Wood Tarver Financial Group LLC initiated a new position in Ford during Q4.
Probity Advisors Inc. increased its stake by 18.6%, now holding 33,055 shares.
Universal Beteiligungs und Servicegesellschaft mbH made a large purchase worth $19.2 million.
Bernard Wealth Management Corp. also entered the stock with a new position.

Currently, 58.74% of Ford’s stock is owned by hedge funds and institutional investors, highlighting continued market interest.