Global trends

The world is facing a period of intense change. Economies and industries are dramatically evolving, driven by development in emerging markets, the accelerated rise of new technologies, sustainability and climate change issues, and changing consumer preferences.

Urbanization – a growing sustainability challenge

The world’s urban population is expected to grow by another 2.5 billion by 20501), and more than 90 per cent of this growth will be in Asia and Africa. India alone is projected to add over 400 million new urban inhabitants by 2050. This rapid urbanization will produce challenges in infrastructure, services, job creation, climate, and environment. Reports show that cities today consume 75 per cent of the world’s natural resources and account for 80 per cent of global greenhouse gas emissions. Therefore, it is in the cities where global sustainability and climate change issues must be resolved.

Digitalization – new business opportunities

Digitalization, increasing automation, and new business models are starting to revolutionize industries and societies. In the automotive industry, trends such as electrification, autonomous driving, connectivity, and shared economy are reshaping businesses. To succeed in meeting the changes, automakers, suppliers and service providers form alliances or participate in for example the development of infrastructure for autonomous and electrified vehicles. The rise of the sharing economy will lead to higher fleet utilization, resulting in new requirements for vehicle materials and design, and therefore new business opportunities for suppliers.

Limited resources – increased importance of a circular economy

Megatrends such as urbanization, population growth, and an expanding global middle class, will have a huge impact on the economics of materials. There will be strong demand for new housing and infrastructure, electric vehicles will account for a rapidly growing share of all vehicles, and sales of smartphones and other electronics will continue to rise sharply. This will put major pressure on the world’s natural resources and create temporary or long-term shortages of critical materials such as cobalt, copper, lithium and nickel. Business models involving recycling and a circular economy will become increasingly important to meet such challenges.

1) UN, 2018 (The 2018 Revision of the World Urbanization Prospects) https://www.un.org/development/desa/en/news/population/2018-revision-of-world-urbanization-prospects.html The 2018 Revision of the World Urbanization Prospects is published by the Population Division of the United Nations Department of Economic and Social Affairs (UN DESA).