# Global automotive market instability and competition

> Live situation record from CLSTR: https://clstr.news/situations/global-automotive-market-instability-and-competition
> Updated: 2026-10-21T12:34:53.000Z. Sources: 9. Developments: 2.

The automotive industry is facing significant challenges characterized by declining sales and increased competition. In China, passenger car sales fell by 28 percent year-on-year in September, marking the largest decline of the year. This slump is attributed to the reduction of government subsidies and tax incentives, alongside a dual challenge of declining domestic demand and massive overcapacity. While internal combustion engine sales dropped by 43 percent, electric vehicles (EVs) captured a record 67 percent of monthly new car sales.

In Italy, the automotive component industry experienced a downturn in 2025, with turnover dropping by 3.0 percent to 53.5 billion euros and employment falling by 2.3 percent. This decline followed a 19.9 percent collapse in national vehicle production. The Italian sector faces pressure from market instability, the energy transition, and increasing competition from Chinese manufacturers, who now account for over one-third of global vehicle production.

## Claims

- The Italian automotive component sector turnover fell by 3.0% in 2025. (corroborated by 3 sources)
- Employment in the sector decreased by 2.3% in 2025. (corroborated by 3 sources)
- Italian vehicle production fell by 19.9% in 2025 to approximately 473,000 units. (corroborated by 3 sources)
- The sector consists of 2,110 companies. (corroborated by 3 sources)
- China accounts for more than one-third of global vehicle production. (corroborated by 2 sources)
- Motorsport specialists saw a 4.2% increase in revenue. (single source)
- Piedmont hosts 34.8% of Italy's automotive component companies. (single source)
- Piedmont's regional revenues decreased by 4.6% in 2025. (single source)

## Timeline

### 2026-10-21: Italian automotive component industry faces crisis in 2025

Italy's automotive component sector saw a 3% drop in turnover and a 2.3% decline in employment in 2025, driven by falling vehicle production and rising competition from Chinese manufacturers.

6 sources. https://clstr.news/cluster/italian-automotive-component-industry-faces-crisis-in-2025

### 2026-10-14: China automotive market faces crisis as car sales drop 28%

China's car market faces a crisis as September sales dropped 28% year-on-year, driven by overcapacity and falling demand, forcing manufacturers to look toward European exports for survival.

3 sources. https://clstr.news/cluster/china-automotive-market-faces-crisis-as-car-sales-drop-28

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Cite as: Global automotive market instability and competition. CLSTR, https://clstr.news/situations/global-automotive-market-instability-and-competition