Automobile Manufacturers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 252 auto manufacturers in the US sell vehicles to new automobile dealers, corporations, rental car firms, utility companies, and government agencies, and make vehicles available directly to consumers through subscription services. They also sell original equipment replacement parts to dealers, fleet managers, parts wholesalers, and repair and maintenance companies.
Dependence on Economic Conditions
The automobile industry is highly cyclical: an economic boom is generally accompanied by high sales in the automobile industry, while sales usually suffer during economic downturns.
Competition from Used Vehicles
Used vehicles are a direct substitute for the new vehicles offered by automobile manufacturers.
Industry size & Structure
The average auto manufacturer employs about 1,200 workers and generates about $1.2 billion annually.
- The automobile manufacturing industry consists of about 252 establishments that employ about 295,600 workers and generate about $296 billion annually.
- The industry is highly concentrated; the top eight companies account for over 90% of industry revenue.
- Large US-based companies include General Motors, Ford, and Tesla. Chrysler is headquartered in the US, but is a subsidiary of Netherlands-based Stellantis.
Industry Forecast
Automobile Manufacturers Industry Growth
Recent Developments
Jan 17, 2025 - New Light-Vehicle Sales Up in December
- US new light-vehicle seasonally adjusted annualized sales (SAAR) rose 5.5% in December 2024 year over year, totaling 16.8 million units, according to NADA Market Beat. The results were the highest monthly SAAR since May 2021. Year to date, new light-vehicle sales totaled 15.8 million units, an increase of 2.2% compared to 2023. Categories performing well in 2024 include all segments of alternative-fueled vehicles, which represent 20% of new vehicles sold. Ten percent of all new vehicles sold were conventional hybrids in 2024, up from 7.6% in 2023. Average incentive spending per unit increased to $3,442 in December 2024, up $809 year over year. Light-vehicle sales in Q4 2024 totaled 4.1 million units, up 7.7% from Q4 2023. New light-vehicle inventory is expected to be just below 3 million units for most of 2025. The forecast for light-vehicle sales in 2025 is 16.2 million units, up 2% compared to 2024.
- A new loyalty study from LexisNexis found that US brand affinity increased 1.8% in 2024 to 52.6% and is closer to pre-pandemic levels, according to Body Shop Business. There were 47 brands analyzed in the study; 11 surpassed the industry average in brand loyalty, an increase from the nine brands in 2024. The study also tracked fuel type loyalty among consumers who replaced a new vehicle with another. The transition to electric vehicle (EV) and hybrid powertrains from legacy internal combustion engines (ICE) powertrains has led to lower ICE brand loyalty rates, falling from 97.6% in 2019 to 85.2% in 2024. Electric vehicle loyalty declined slightly to 74.7% in 2024 and hybrid vehicle replacements jumped 5 percentage points to 52% in 2024.
- Consumer confidence levels declined in December 2024, falling by 8.1 points from the previous month, according to The Conference Board. The Consumer Confidence Index was 104.7 in December 2024 from 112.8 in November 2024. Dana Peterson, chief economist at The Conference Board, noted that those remaining most confident on a six-month moving average basis confidence were those aged under 35 and those in the income category of over $100,000. Per Peterson, “The recent rebound in consumer confidence was not sustained in December as the Index dropped back to the middle of the range that has prevailed over the past two years.” Purchasing plans for homes decreased while plans to buy new cars and big-ticket items rose in December 2024 on a six-month average basis.
- According to a report in Nikkei Asia, the election of Donald Trump as president could raise US auto production costs by $40 billion due to his plans for 10-20% tariffs on all imports and additional tariffs of up to 60% on Chinese goods. The increased tariffs could have a major impact on the auto industry, which has sales of 15 million vehicles per year. Many of the vehicles are imported from Mexico, Canada, and Japan. The tariffs would apply to finished cars and auto parts. Mexico accounted for over 40% of auto parts imported into the US in the first half of 2024. According to calculations by consulting firm AlixPartners, higher tariffs on imported parts could increase the manufacturing cost per US-made car by up to $4,000. It is expected that the tariffs would lead automakers to increase production in the US. While research nonprofit organization Tax Foundation estimates the tariffs could increase US revenue by $3.8 trillion in the long term, it is anticipated that companies will cover the higher costs by raising prices, per the report.
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