Electromobility as a way out of the automotive crisis – market opportunities and challenges
The automotive industry is under massive pressure in 2025. Raw material shortages, geopolitical risks, new emissions regulations, and technological change are challenging manufacturers, suppliers and system developers alike. In the middle of this upheaval, one segment is still seen as a vital beacon of hope: electromobility.
While new registrations of battery electric vehicles (BEV) in Germany rose by 45 percent in May 2025 according to the Kraftfahrt-Bundesamt (Federal Motor Transport Authority), the international market reveals a more nuanced picture. It is now up to the electronics industry in particular to drive forward innovations in power electronics, charging infrastructure and system integration, and to strengthen its role in the mobility transition.
Supply chains under pressure
Global conflicts are putting a strain on electromobility. China’s export restrictions on rare earth magnets interrupted production lines of European OEMs such as BMW and Mercedes-Benz. That makes it clear that electromobility is closely linked to geopolitical supply chains. Critical materials such as neodymium, cobalt and lithium are not only expensive but also politically sensitive.
The EU is responding with the Critical Raw Materials Act (CRMA) and supporting projects to secure and diversify supply chains. Nevertheless, dependence remains a structural weakness, especially for electronics suppliers that rely on the continuous availability of highly specialized components.
Electromobility is no longer a niche phenomenon
The International Energy Agency (IEA) forecast sales of around 17 million electric vehicles worldwide in 2024, and thus a growing market share with China leading the way.
Economies of scale in battery production are leading to falling prices, with lithium prices dropping for two years in a row. This will also make entry-level models more affordable and reach new customer segments. Electronics suppliers are benefiting from the growing demand for high-efficiency DC/DC converters, modular control unit architectures and V2G-capable charging units.
Challenges: infrastructure, tariff policy, market acceptance
Expanding the charging infrastructure remains one of the biggest challenges. While China and North America are setting new standards, Europe is lagging behind international market developments. Fleet operators and rural regions in particular suffer from insufficient coverage.
At the same time, the trade policy conditions are worsening: The EU and the US imposed punitive tariffs on Chinese e-cars. Although these measures have a protectionist effect, they also create uncertainty for suppliers with global production networks.
Market acceptance also suffers from range anxiety, in other words, the fear that an electric car will run out of power while driving, and questions about its suitability for everyday use. Many consumers are therefore hesitant to buy a BEV. This is where networked solutions such as smart charging, dynamic tariffs and user-centric software platforms are called for.
Innovation potential with the circular economy and digital services
The growing number of electrified vehicles also increases the pressure to sustainably recycle used batteries. New recycling methods – including hydrometallurgical approaches – and design-for-recycling concepts offer new markets for materials research and sensor technology.
At the same time, digital business models are emerging: Over-the-air updates, predictive maintenance and platform services for fleet management are turning electromobility into an IT-driven mobility platform. OEMs are gaining direct access to raw materials and infrastructure through joint ventures, as the example of the joint venture between BMW and Mercedes-Benz for developing a fast-charging network in China shows.
Learn more about the challenges of electromobility at the electronica Automotive Conference.
On September 10, 2025, you can look forward to inspiring expert presentations from international companies such as Bosch, Infineon, Microsoft, NXP, and many others.