Sweden’s automotive industry is known for innovation – whether that’s developing new safety technologies or leading in sustainable mobility, the biggest brands have been attempting to set a new standard to rival competition from the likes of China.
But commitment to future-proof technology comes with challenges, as proved by the news of Northvolt’s bankruptcy. The business that was once Europe’s leading hope to – in the words of Northvolt chair Tom Johnstone – “drive real change in the battery, EV and wider European industry and accelerate the transition to a green and sustainable future” has fizzled under increased costs caused by supply chain issues, changing customer demand and variations in government support.
In light of this – just the latest business impacted by setbacks across the industry, where does that leave Sweden’s automotive market and how are others navigating the changing opportunities?
Navigating a transforming industry
Despite the challenges, the market is still very positive for Sweden’s growth, with the country remaining one of Europe’s key electric automotive markets. January 2025 saw a. 14.4% YoY growth in passenger cars, with 51.6% of new registrations being plug-in-vehicles.
Sustainable transport also leads the way in Sweden, with a 15.8% YoY increase in heavy-duty trucks (8.9% YoY in electric trucks) and a massive 222.4% increase in registrations in the bus market (with 67.9% of those being electric).
“We estimate that BEVs will account for 40% of new car registrations this year, helping reduce emissions and lower fuel costs for consumers.” Said Sofia Linder, Chief Economist at Mobility Sweden.
Major brands like Volvo and Scania are also reaffirming their commitments to staying at the forefront of advanced embedded technology and electrification.Autonomous and connected vehicle technology is also remaining a priority for Sweden’s automotive landscape, led by companies like Einride who are pioneering autonomous electric trucks, transforming logistics and freight transport. Volvo’s autonomous driving subsidiary, Zenseact, continues to lead in developing advanced driver assistance systems (ADAS) and self-driving capabilities.
Sweden’s well-developed automotive testing infrastructure, including AstaZero, provides a world-class environment for connected and autonomous vehicle research. As software-defined vehicles become the industry norm, embedded systems engineers play a critical role in developing robust, secure, and efficient software architectures that enable automation, connectivity, and AI-driven decision-making.
The embedded expertise problem
Increasing reliance on electronics and software-defined systems fuels a surge in demand for experts in embedded systems. The growing complexity of vehicle functions creates a skills shortage, and if the above systems remain as in demand as we predict, it creates a huge market for those who have access to that expertise.
Sweden’s government know this, having launched a STEM strategy to increase students in higher education STEM subjects from 83,000 to 90,000 by 2035 to address the incoming skills shortage. But educating new talent for the future doesn’t solve the immediate problem.
The Swedish automotive electronics market was valued at USD 1,378.5 million in 2023. By 2030 it’s expected to more than double, growing at a CAGR of 12.5%.
Planning for future workforces is important – but so is ensuring you have access to the right experts today, to make the most of the incoming demand.
True Expertise Delivered
Coalesce Management Consulting’s specialist automotive consultancy operations include dedicated resources focused on Sweden’s electronic and embedded market. By driving a close focus within the region, we have a deep understanding of the strategic priorities of the major players across the market.
Our Sweden embedded automotive team build relationships with the biggest technology providers and industry front-runners to ensure that we are able to work closely with the latest innovations, and enhance our service offerings across the full reach of the market.
This means that we are continuously able to build our virtual workbench with the true experts in emerging technologies:- those who can deliver a level of skill that can’t be found anywhere else, and is highly in demand by those who want to push the boundaries of vehicle technology.
Our track record of successful project deliveries speaks for itself, but if you want to know more about how our Sweden team pioneer the automotive market, reach out to us for a discussion of our expert consulting services.
Or meet us in person – we’ll be at the VECs conference in Gothenburg on the 18th-19th March, discussing the latest market dynamics and innovations with all the biggest automotive business leaders. Book some time in with our core team: Andy Grogan, David Marsh, Sam Catto, us at the conference if you’re going to be there – or if you’re not attending the conference, get in touch anyway to set up a call to discuss how your business can benefit from CMC’s experts.