Automotive Industry Trends + 2024 Outlook

Automotive Industry Experts Share The Strongest Predictors for 2024 

Every calendar year, momentous events take place that define the present and shape the future, evolving as time progresses. Cloud Theory’s unique automotive industry trends perspective on comprehensive supply and demand points to five major issues that will dominate the automotive environment in 2024.




Supply Dynamics

A look at the rapid increase of new vehicle inventory due to the easing of post-COVID supply chain issues, though not without continuing challenges and complexities

Demand Dynamics

How buying behaviors have shifted in relation to the supply rebound and the likely impact this will have on pricing and incentives

Electric Vehicles

The ever-evolving trends associated with EVs as OEMs calibrate their investments and production in this sector to meet looming regulatory requirements

Economic Influences

The impact of inflation and higher interest rates on model and trim selections

Inventory Efficiency

A view of the top 10 makes that got more than their fair market share given their relative inventory position in the marketplace

Top 5 Major Trends that Will Dominate the Automotive Environment in 2024

Down arrow png


Achieving 3 Million Monthly New Vehicle Count by Year End: Not Just Attainable, but Highly Probable.

According to our data and sources, it is almost a given that inventories will continue to grow, but there are still some residual headwinds that will put a ceiling on how high production can go. Here's why.



Persistent Parts and Manufacturing Challenges: Expect Sustained Supply-Demand Imbalance, ~30% Turn Rates, and $2,000 Marketed vs. MSRP Gaps.

In 2024, OEMs will be operating in a more challenging environment than has been in place for the past three years, and these manufacturers will have to work harder to push demand for their vehicles in an increasingly supply-driven market. View Full Details.



EV Turn Rates Languished Below 30% for Much of the Latter Half of the 2023, While Days-To-Move Doubled From the Mid-30s to the 70s.

Cloud Theory has previously published a comprehensive EV Report entitled “Charging Ahead: Which EV Brands Will Dominate the Next Decade?”, which provided a detailed view of each OEM’s past, present, and future state in this dynamic and ever-evolving space. 

The EV industry will continue to make headlines as OEMs navigate production issues, pricing and profitability considerations, regulatory shifts, battery innovations, charging infrastructure development, consumer concerns. Learn More.



Driving Expenses Surge: Consumers Grapple with Over $100 Monthly Spike in Average Car Payments, 2023's Multi-Faceted Increase Unveiled.

The interest rate increase on vehicle loans that began in spring 2022 continued throughout 2023, as the Federal Reserve instituted multiple hikes to combat accelerating inflation. With 2024 looking similar to 2023 in terms of interest rates, manufacturers will be well served to offer a balanced portfolio of vehicle trims that best suit the economic realities that consumers will continue to face. See why.



Eight of the Top 10 Makes Carried Over From 2022 to 2023, the Rise of General Motors Brands Demonstrates That Moving Upwards Is Achievable.

With this in mind, the makes that are getting more than their fair market share relative to their inventory share have an inherent advantage. View Details.


QUICK ACCESS: Jump to Different Chapters of the Automotive Trend Report by Clicking the Numbers and Links Below

What Are Automotive Industry Trends?

Automotive Industry Trends encapsulate the dynamic and evolving directions shaping the automotive sector today and into the future. These trends reflect how companies within the industry are innovating and adapting to meet the changing demands of technology, regulation, consumer behavior, and the global economy. Key areas of focus include:

  • Electrification: The shift towards electric vehicles (EVs) as part of a broader commitment to reducing carbon emissions and promoting sustainable mobility solutions.
  • Autonomous Driving: The development of self-driving technologies aimed at enhancing safety, efficiency, and accessibility in transportation.
  • Connectivity: The integration of connected car technologies, enabling vehicles to communicate with each other, infrastructure, and the internet to improve the driving experience and vehicle functionality.
  • Sustainability: The adoption of eco-friendly manufacturing processes and materials to minimize the environmental impact of vehicle production and operation.
  • Digital Transformation: The digitalization of customer interactions and operational processes, from the car buying experience to after-sales services, reflecting the industry's shift towards a more service-oriented approach.
  • Mobility-as-a-Service (MaaS): The transition from vehicle ownership to mobility solutions that offer on-demand transportation services, underlining changing consumer preferences and the rise of the sharing economy.
  • Supply and Demand Dynamics: The balance between the supply of vehicles and consumer demand is a critical factor driving the automotive industry. Economic conditions, advancements in vehicle technology, global supply chain challenges, regulatory changes, and evolving consumer preferences all influence this dynamic balance. Automakers must continuously adapt their production strategies and vehicle offerings to align with these shifting supply and demand trends, ensuring they can meet market needs while optimizing operational efficiency and profitability.

These trends collectively represent the forefront of innovation in the automotive industry, highlighting the pathway towards a more sustainable, efficient, and technologically advanced future in mobility. Understanding these trends is essential for industry stakeholders, including manufacturers, suppliers, policymakers, and consumers, to navigate the challenges and opportunities presented by the rapidly changing automotive landscape.


Achieving 3 Million Monthly New Vehicle Count by Year End: Not Just Attainable, but Highly Probable.

New vehicle inventories ended 2022 at 1.64 million—more than double the supply chain-challenged low of September 2021, but still well below historical (i.e., pre-pandemic) levels. For eight months, those inventory levels were on a slow but steady climb, adding an average of 2.9% each period. In September 2023, inventory levels surpassed 2 million for the first time in two-and-a-half years as supply gains accelerated, and the last three months of the year added 11%, 8%, and 6% to supply counts. 2023 inventories ended exactly one million vehicles higher than a year prior.

2023 inventories ended exactly one million vehicles higher than a year prior.

This recent rapid ramp-up is a reflection of supply chain issues easing and a shared desire across all OEMs to fill their pipelines and introduce/refresh vehicles after two years of delays and deferrals.


2024 Outlook and Key Considerations

The inventory dynamics of 2023 will undoubtably continue to echo into 2024, though it’s impossible to predict the exact inventory levels that will be reached. It is a safe bet to say that supply levels will continue to accelerate, and even a 1.5% compounded monthly rate of growth would push average monthly new vehicle counts above 3 million by the end of the year. How the inventory situation plays out over the next year (and beyond) is subject to two interrelated factors: shorter-term and longer-term.

...Supply levels will continue to accelerate, and a 1.5% compounded monthly rate of growth would push average monthly new vehicle counts above 3 million...

Shorter-Term Factor

The short-term factor is that supply chain disruptions, while easing, will continue into the new year. A recent Deloitte study pointed to a situation in which parts suppliers are unable to fulfill the demands of their OEM customers due to economic vulnerabilities that started during the parts shortage crisis and continue as inflation and interest rates have weighed on bottom lines.

“Although the OEMs were able to turn the [parts shortage] situation to their advantage through increased pricing and profitability, suppliers were largely left to struggle with the low-volume environment that was accentuated by production planning instability and expedited freight.” Additionally, “the prolonged inflationary environment is applying significant pressure to a relatively vulnerable supply base that is struggling to find the resources necessary to invest in future products and solutions.”

These pressures and vulnerabilities have increased the likelihood of supplier bankruptcies, exacerbating the risk of delayed parts deliveries and the perpetuation of production disruptions.

Longer-Term Factor

A Boston Consulting Group study found that, prior to the pandemic, “Supply chain systems and management practices have long favored optimizing operations by making supply chains as lean as possible, while simultaneously pressuring suppliers to reduce costs and inventory. Current just-in-time approaches leave little buffer to absorb disruptions.”

The aftermath of the COVID-19 pandemic has led many OEMs to rethink this approach and to begin focusing on ways to simplify production, logistics, and parts procurement through more direct partnerships and alliances (especially in the EV sector) and to improve understanding of their supply chains in order to anticipate issues and react more rapidly when they occur.

In September 2023, for example, Ford Motor Company announced that it would restructure its supply chain to “support efficient and reliable sourcing of components, internal development of key technologies and capabilities, and world-class cost and quality execution.” This includes the formation of a Chief Supply Chain Officer position, reporting directly to CEO Jim Farley.

Ford is not alone in making these moves. According to an industry analysis performed by Capgemini Research Institute, “automakers have been forced to rethink, restructure, and refinance their supply chain management.” The report goes on to say that “A global re-orchestration is underway as procurement from offshore locations fell by 22% in the past two years.”

The migration toward EVs is accelerating the pursuit of restructuring tactics such as “giga-casting,” which is the production of integrated vehicle systems in larger sections rather than the assembly of multiple parts from a myriad of suppliers. The simpler structure of an EV powertrain compared to an ICE one (20 parts vs. 2,000) drives this shift, but it is also being applied to more traditional vehicle systems as time progresses.

While progress on these fronts is being explored and pursued, another aspect of the response to supply chain challenges has been slower to take hold. Having detailed visibility and insights regarding suppliers—especially second-tier vendors—has proven to be difficult, and this impediment is likely to continue until OEMs put more formalized mechanisms to track these complex ecosystems into place. As the BCG analysis put it, “companies lack adequate supply chain visibility. Supply chains have become so complex that automakers are frequently unable to identify suppliers beyond tier one. As a result, automakers do not know these suppliers’ manufacturing locations, lead times, and production and shipment track records—or even the parts or materials they supply.”

That same BCG analysis drew from a survey performed in 2022 across various industries to determine supply chain resiliency. The vast majority of respondents indicated that their companies were reactive, with slow response time and low levels of structural operations to deal with disruptions. Most notably, all automotive responses were in that reactive quadrant.

Automotive Companies Are Unprepared for Disruptions


The Ford efforts noted above are an example of how it and other OEMs are taking a long, hard look at their supply chain knowledge and planning in light of the disruptions that took hold in 2021 and continued to wreak havoc over the next two years. But this is by no means a short-term fix; it will be a long-term transition to build a new model to replace long-standing just-in-time practices that have ruled the day for many years.


Overall, it is almost a given that inventories will continue to grow throughout 2024 as OEMs move to fill product pipelines, launch new vehicles, and pursue refreshes that were previously delayed or deferred. Getting to an average monthly new vehicle count of 3 million by the end of the year appears not only attainable but likely.

It is almost a given that inventories will continue to grow ...but there are still some residual headwinds that will put a ceiling on how high production can go

But while supply chain issues are definitely easing and OEMs are placing greater focus on their management and simplification of them, there are still some residual headwinds that will put a ceiling on how high production can go.

These come in the form of continuing supplier disruptions due to enduring economic and financial issues (particularly at the second-tier level and below) and lack of detailed knowledge of and visibility into complex parts systems in order to affect change.

Explore Our Sister Resource: Supply Dynamics Insight
Auto Industry Adds One Million Vehicles to Inventory Since September 2021 Low

Request a demo from Cloud Theory.

Jump to the Top of This Navigator

Download Your FREE Report Now


Want Access to Real-Time Daily Automotive Insights?

(including free competitive insights you can use today)

Request a Demo