Automotive, Connected Mobility and Industrial Transition
From legacy car manufacturing to batteries, software-defined vehicles, sensors and autonomous systems.
Europe’s automotive sector is no longer defined only by vehicle production, consumer demand or the replacement of combustion engines with electric drivetrains. It is becoming a strategic industrial base in which value is moving towards batteries, processed materials, power electronics, semiconductors, sensors, software-defined architectures, vehicle data, charging infrastructure, industrial automation and grid-integrated mobility. This transition raises a direct question for Europe: whether it can retain control over the technologies, supply chains, skills and production systems that will determine the next phase of mobility, or whether it will preserve brands and assembly capacity while losing the highest-value layers to Chinese scale and American digital-industrial power.
The report is structured around four analytical movements. It first explains why automotive remains one of Europe’s core industrial systems, linking employment, manufacturing value added, exports, research and regional production networks. It then examines the new automotive technology stack, from batteries and semiconductors to software-defined vehicles, sensors, autonomous systems, charging and factory automation. The third section assesses the regulatory and competitive environment, including EU industrial policy, climate rules, battery regulation, vehicle data, cybersecurity, Chinese competition and US industrial incentives. The final section provides Defence Finance Monitor’s strategic assessment of the bottlenecks, dependencies and investable capabilities that will determine whether Europe’s automotive base remains a strategic industrial asset by 2030.