Small Cars Market Size, Share & Trends Analysis Report By Fuel Type (Petrol, Diesel, Electric), By Region (North America, Europe, Asia Pacific, Central & South America, Middle East & Africa), And Segment Forecasts, 2021 - 2028

Report Overview

The global small cars market size was valued at USD 105.91 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 7.9% from 2021 to 2028. The growing number of entry-level buyers and affordable pricing of small cars are the factors driving the growth. In addition, skyrocketing fuel prices and growing environmental concerns further boost the demand for fuel-efficient small cars in the global passenger cars market. An increase in disposable income and growing spending on vehicles will benefit the growth of the market in the forthcoming years. The increased inclination of automakers toward producing fuel-efficient cars by reducing the weight and size of vehicles and stringent carbon emission laws will drive the demand for small cars globally. Increased steel and plastic prices are forcing the automakers to shift their focus toward small cars, further propelling the growth of the market.

A rise in middle-class population across the globe along with the availability of affordable small cars are the factors attracting entry-level buyers, resulting in growing demand. To expand the share in the growing smart cars segment, automakers are expanding their small cars portfolios by not limiting to the petrol and diesel fuel types, but also by providing options in hybrid electric cars, battery-electric cars and plug-in hybrid electric cars, which is expected to appeal to a large consumer base and accelerate the growth of the market. 

Factors such as the new product developments and technological advancements in different fuel categories are expected to open up new market opportunities for the makers and create attractive buying options for the customers in near future. Higher prices of electric-based models, stricter CO2 emission norms, and the growing popularity of SUVs is anticipated to hamper the growth of the market for small cars during the forecast period. 

The COVID-19 pandemic has adversely affected global sales of small cars. To control the spread of the coronavirus, many countries imposed country-wise strict lockdown as well as stopped international trading. This resulted in restrictions on stepping outside of the house, lowering the demand for small cars. However, as things get back to normal, it is expected that small cars will witness a significant rise in demand in near future.

Fuel Type Insights

Petrol-based small cars accounted for the largest market share of the small car market with over 45% of the global revenue in 2020. The segment is expected to expand at a substantial CAGR from 2021 to 2028. The conventional petrol cars segment holds the majority of the market share as these cars are less harmful to the environment compared to diesel cars. The increased inclination of consumers toward green fuel type is expected to hamper the demand for the growth in demand for petrol-based cars in near future. 

The electric-based small cars segment held a considerable market share in 2020. The segment is and expected to witness the fastest CAGR of 13.5% from 2021 to 2028. Growing hype among the consumers regarding electric-based cars due to their ability to provide sustainable and environment-friendly solutions to growing pollution is expected to contribute to the growth. The new product developments from a majority of market players in this segment as well as huge investments in research will further propel the growth. Battery-based electric cars and hybrid plug-in electric cars have a huge demand in this segment.

Regional Insights

Europe held the largest market share of over 45% in terms of global revenue in 2020 and is anticipated to continue to witness a substantial CAGR over the forecast period. Small cars are highly popular and hold the largest share of passenger cars sold in this region. The presence of top brands, increased spending on vehicles, availability and affordability of electric vehicles, are some of the key factors driving the growth of the regional market. Growing emission standards may benefit the growth in demand for electric-based cars. 

The Asia Pacific regional market is expected to register the fastest CAGR of 8.3% from 2021 to 2028. Japan, South Korea, and India are the major contributors to the high demand for small cars in the region. The increasing middle-class population, a large number of working young people, presence of local and global players, increased disposable income and expansion of distribution channels from top brands, are some of the key factors positively influencing the growth of the market. 

Key Companies & Market Share Insights

the global market for small cars is highly competitive. A large number of regional and global players have a vital role in driving the growth of the market. Some big players operating in this market are, Stellantis NV, Toyota Motor, Renault, Volkswagen, Hyundai Motor Company, General Motors (Chevrolet), Ford Motor Company, Honda Motor Company, Ltd., and Suzuki Motor Corporation. Top western automakers shifted their production facilities to the BRIC nations to tap into the market and benefit from the low production facility. Some of the prominent players operating in the global small cars market are:

• Stellantis NV
• Toyota Motor
• Renault
• Volkswagen 
• Hyundai Motor Company
• Kia Corporation
• Suzuki Motor Corporation
• General Motors (Chevrolet)
• Ford Motor Company
• BMW Group
• Honda Motor Company, Ltd.

Small Cars Market Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2028. For this study, Million Insights has segmented the global small cars market report based on fuel type and region:

• Fuel Type Outlook (Revenue, USD Million, 2017 - 2028)
  • Petrol
  • Diesel
  • Electric
  • Others
• Regional Outlook (Revenue, USD Million, 2017 - 2028)
  • North America
    • U.S.
    • Canada
  • Europe
    • Germany
    • U.K.
    • France
    • Russia
    • Italy
  • Asia Pacific
    • China
    • Japan
    • India
  • Central & South America
    • Brazil
    • Argentina
  • Middle East & Africa
    • South Africa
    • Saudi Arabia