The reliable operation of electronic equipment is strongly related to the thermal and mechanical conditions it is exposed to during operation. In order to ensure a long lifetime of components, it is imperative that any electronic packaging design takes into careful consideration the appropriateness of various thermal management schemes and the application-specific requirements in order to keep temperatures within certain limits. The exact requirement varies with the application, and electronic packaging designs for automotive applications are at particular risk of failure due to the naturally harsh conditions it is exposed to. Electronic devices in vehicles have to be able to operate and survive at much higher temperatures than their consumer counterparts. While that has always been an issue, the rise of electric and hybrid electric vehicles (EVs and HEVs), combined with a desire to fit as much as possible into the smallest form factor, the challenge of removing enough heat from electronic devices in automotive vehicles is constantly evolving. This paper closely examines the new challenges in thermal management in various driving environments and aims to classify each existing cooling methods in terms of their performance. Drive schedules used by the Environmental Protection Agency (EPA) for emission and fuel economy testing are taken as examples of different realistic driving scenarios and their predicted thermal profiles are evaluated against various cooling methods, both active, passive or a combination of the two (hybrid). Particular focus is placed upon emerging solutions regarded to hold great potential, such as phase change materials (PCMs). Phase change materials have been regarded for some time as a means of transferring heat quickly away from the region with the electronic components. Phase change materials are widely regarded as a possible means of carrying out cooling in large scales from small areas, considering their advantages such as high latent heat of fusion, high specific heat, controllable temperature stability and small volume change during phase change, etc. They have already been utilized as a method of passive cooling in electronics in various ways, such as in heat spreaders and finned heat sinks. The applications, however, have been mostly for system-on-chip handheld devices, and their adoption in automotive power electronics, such as those used in traction inverters, has been much slower. A brief discussion is made on some of the potential areas of application and challenges relating to more widespread adoption of PCMs. Merits of some of the existing PCM based solutions for automotive electronics applications are also discussed, as are their drawbacks and modifications.