Passenger Car Market Report 2026

The passenger car market size has grown strongly in recent years. It will grow from $1.64 trillion in 2025 to $1.74 trillion in 2026 at a compound annual growth rate (CAGR) of 6.4%. The growth in the historic period can be attributed to urbanization growth, rising disposable income, expansion of road infrastructure, mass vehicle ownership trends, affordability of passenger cars.

The passenger car market size is expected to see strong growth in the next few years. It will grow to $2.32 trillion in 2030 at a compound annual growth rate (CAGR) of 7.4%. The growth in the forecast period can be attributed to electric vehicle incentives, autonomous driving adoption, emission reduction mandates, smart mobility ecosystems, consumer demand for connected features. Major trends in the forecast period include rising adoption of electric passenger cars, growing preference for utility vehicles, increasing integration of advanced safety features, higher demand for fuel efficient models, expansion of connected car technologies.

The increasing adoption of electric vehicles is anticipated to drive the growth of the passenger car market in the coming years. An electric vehicle (EV) is a vehicle that operates using an electric motor powered by a rechargeable battery that can be charged externally. The rising demand for passenger cars linked to EV adoption is driven by factors such as improved affordability, supportive government policies, growing environmental awareness, and ongoing technological progress. Passenger cars play a crucial role in enabling EV adoption by incorporating advanced electrification technologies, enhanced battery systems, and efficient charging solutions. For example, in October 2024, according to Statistics Canada, the country’s national data agency, electric vehicle registrations represented 3.9% of all light-duty vehicle registrations in 2023, increasing from 3% in 2022. Therefore, the growing adoption of electric vehicles is contributing to the expansion of the passenger car market.

Major companies operating in the passenger car market are emphasizing the development of new products, including battery-electric compact crossover SUVs built on dedicated EV platforms, to strengthen their competitive positioning. These electric SUVs combine zero-emission powertrains with the practicality of SUVs, offering an efficient alternative to traditional vehicles. For instance, in September 2024, Zeekr, a China-based automobile manufacturer, introduced the Zeekr 7X, a five-seat fully electric SUV. The Zeekr 7X features dual battery options of 75 kWh LFP or 100 kWh NMC, supports an 800-volt charging system enabling a 10-80% charge in approximately 10.5 minutes, and delivers rapid acceleration from 0 to 100 km/h in about 3.8 seconds. This development expands the SUV segment to include clean-energy vehicles, increasing its appeal among environmentally conscious consumers while capitalizing on global SUV demand, though it also presents challenges such as higher production complexity and increased requirements for charging infrastructure.

In March 2024, Chery Automobile, a China-based manufacturer of passenger cars and electric vehicles, acquired Soueast Motor for an undisclosed value. Through this acquisition, Chery seeks to increase its production capacity and reinforce its regional presence by integrating Soueast’s manufacturing operations, thereby improving its ability to address rising demand and support its global growth strategy. Soueast Motor is a China-based automobile manufacturer producing passenger vehicles, including SUVs and sedans, under its own brand and will, following the acquisition, add manufacturing capacity and distribution capabilities to Chery’s wider product portfolio.

Major companies operating in the passenger car market report include Volkswagen AG, Toyoto Motor Corp, Daimler AG, Fiat Chrysler Automobiles NV, Ford Motor Co., General Motors Company, BMW AG, Honda Motor Co Ltd., Hyundai Motor Co. Ltd., SAIC Motor Co ltd., Groupe PSA, Tesla Inc., Nissan Motor Co Ltd., Kia Motors Corporation, BYD Company Limited, Renault SA, Jeep, Tata Motors Limited, Suzuki Motor Corporation, Subaru Corporation, Mazda Motor Corporation, FCA Italy S.p.A., Geely Automobile Holdings Limited, Great Wall Motor Company Limited, Mitsubishi Motors Corporation, Guangzhou Automobile Group Co. Ltd., Changan Automobile Co. Ltd., Dongfeng Motor Corporation, Maserati S.p.A., Brilliance China Automotive Holdings Limited.

Asia-Pacific was the largest region in the passenger car market in 2025. Western Europe was the second-largest region in the passenger car market. The regions covered in the passenger car market report include Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the passenger car market report include China, India, Japan, Australia, Indonesia, South Korea, Bangladesh, Thailand, Vietnam, Malaysia, Singapore, Philippines, Hong Kong, Taiwan, New Zealand, UK, Germany, France, Italy, Spain, Austria, Belgium, Denmark, Finland, Ireland, Netherlands, Norway, Portugal, Sweden, Switzerland, Russia, Czech Republic, Poland, Romania, Ukraine, USA, Canada, Mexico, Brazil, Chile, Argentina, Colombia, Peru, Saudi Arabia, Israel, Iran, Turkey, UAE, Egypt, Nigeria, South Africa.

The passenger car market consists of sales of pickup trucks, compact cars, and minivans. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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