This blog is based on the recent Frost & Sullivan analyses:
Top Transformations Driving the Global Automotive Market, 2025, authored by Joe Praveen, Associate Director-Business Strategy & Innovation Group
Global Macroeconomic Risks and Opportunities Emerging from Trump 2.0, 2025–2028 authored by Rituparna Majumder, Industry Principal at Frost & Sullivan
The Era of Automotive Realignment is Here
Trade wars, tariff surges, and military conflict. These aren’t just words that make up headlines — they’re major forces that are redefining supply chains, and in some ways, the global business order.
For instance, within just 100 days of President Trump’s second term in the U.S., automotive OEMs and suppliers were confronted with a 12x jump in average tariff rates. From 25% duties on imported vehicles and components to 145%+ levies on Chinese goods, the impact seemed significant — before many of these measures were reversed or adjusted.
But this shift emphasized a period of uncertainty that continues to push OEMs towards relooking business models and carving out opportunity from chaos. In other words, the auto industry stands at a pivotal crossroads: those who adapt boldly can unlock tomorrow’s competitive edge.
Read on to explore Frost & Sullivan’s strategies for success in today’s business world or gain access to our complete in-depth growth analysis here.
Strategic Imperative #1: EV Momentum in a Volatile Ecosystem
Are you still betting on incentives, or evolving your EV growth strategy for global relevance?
The U.S. oil and gas resurgence, disappearing subsidies, and rising battery tariffs are casting shadows on the EV sector. But global leaders are recalibrating:
- Short-term: Focus on internal combustion engine (ICE) models to hedge against EV slowdowns
- Mid-term: Localize battery and EV production
- Long-term: Target emerging automotive regions with demand for affordable EVs
From biofuels and hybrid ICEs to electric mobility strategies tailored for regions like India and ASEAN, innovation is alive in the EV space; It just requires a strategic pivot.
Access Key EV Strategy Insights and Opportunities here
Strategic Imperative #2: Rethinking the Supply Chain
Are you reimagining supply, demand, and your commercial strategy in a fragmented global economy?
Global sourcing from high-import regions like China, Mexico, and Canada to the US is now costlier and less predictable. Ecosystem leaders are responding with:
- Localization and automation investments
- Diversification across Europe and Asia
- Nearshoring to ASEAN and India
Beyond just survival, supply chain recalibration is becoming a differentiator.
Explore Global Sourcing Growth Opportunities here
Strategic Imperative #3: Cost Control as Innovation
Are you leveraging innovative business models as a catalyst for intelligent transformation?
Tariff-fueled volatility is prompting a leaner, smarter operational approach. Companies are embracing:
- Digital twins to simulate production and reduce waste
- Predictive maintenance and AI-powered logistics
- Battery recycling ecosystems to recover critical resources
Every cost saved is capital redirected toward strategic growth.
Discover Best Practices from Ecosystem Leaders Embracing New Business Models
Industry Perspectives: What the Data Is Telling Us
Frost & Sullivan’s experts have mapped transformational shifts including:
- Rising viability of used electric vehicles
- Regional divergence in supply chain recalibration
- OEMs investing in strategic local partnerships
- Smart cost modeling using Total Cost of Ownership (TCO) analytics
These opportunities reflect not just consumer preferences — they reveal best practices, competitor benchmarks, and emerging companies to action.
View the Full Growth Opportunity Analysis
Charting a Resilient Future: Next Steps
Frost & Sullivan helps OEMs, suppliers, and mobility innovators:
- Leverage data-driven market intelligence to navigate disruption
- Identify and action growth opportunities across emerging regions
- Align innovation and investment strategy with geopolitical dynamics
Get Started now! Engage with our experts in an exclusive Growth Pipeline Dialog.
