Automotive Transmission Market to Hit $84.2 Billion by 2028
The automotive transmission market is estimated to grow from USD 62.4 billion in 2023 to USD 84.2 billion by 2028 at a CAGR of 6.2% over the forecast period. Market growth is fueled by consumer preferences for driving comfort, safety, and improved acceleration and traction. Technology advancements in the emerging markets, upcoming emission regulations with reduced emission limits, and transmission system innovations owing to growing demand for hybrid & electric vehicles offer growth opportunities for the automotive transmission industry.
Automotive transmission
manufacturers must advance hybrid transmission technology due to rising
consumer demand for convenience, fuel efficiency and government initiatives
promoting electric & hybrid vehicles. The automotive industry faces
pressure to adapt to evolving technology and consumer preferences, with
automatic transmission demand driven by smooth gear shifting and acceleration.
The passenger car sector
dominates the automotive transmission market, securing a substantial 71% share
by volume in 2023. China particularly, stands out as the global leader in
passenger car demand, with a noticeable shift towards electric vehicles. India
has also witnessed a significant surge in passenger vehicle sales, registering
a remarkable 27% increase, reaching a record-breaking 3.9 million units in the
last fiscal year. In Asia Pacific, in the passenger car market, automatic
transmission will be dominating by 2028, due to the ease of driving, and smooth
riding experience it offers. Whereas, in the United States, the trend for SUVs
is on a remarkable rise, driven by consumers' preference for larger, sturdier
vehicles. This trend is fueled by perceptions of enhanced safety, spaciousness,
and elevated driving positions. In North America, for passenger cars, Automatic
Transmission will be dominating in the forecasted period followed by CVT and
DCT. In the European region, SUVs dominate the market with almost 49% of total
passenger car sales. In this region, automatic transmission will be dominating
the market followed by manual transmission and DCT.
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CVT transmission type, by number
of forward gears is estimated to be the fastest growing segment. CVT
transmissions, unlike traditional transmission systems uses set of fixed gears
which allows smooth and step-less ratio changes. CVT can avoid shift shock
making it an excellent transmission alternative. CVTs offer smoother
acceleration and improved fuel efficiency compared to traditional automatic
transmissions. Furthermore, CVTs' ability to continuously adjust gear ratios
provides a seamless driving experience, particularly in urban environments with
stop-and-go traffic. As automakers strive to meet stringent fuel economy
regulations and consumer demand for more efficient vehicles grows, the adoption
of CVTs is expected to continue rising, further driving market expansion.
The by two-wheelers automatic
transmission market is estimated to be
the fastest-growing market over the forecast period. This growth can be
attributed to several factors, including convenience and ease of use, particularly
in urban environments with frequent stop-and-go traffic. This appeals to a
broader range of riders, including those needing to be more comfortable with
manual shifting. Additionally, automatic transmissions provide smoother
acceleration and gear changes, enhancing the riding experience. Furthermore, as
technology advances, automatic transmissions are becoming more efficient and
reliable, addressing concerns about performance and maintenance. Finally, with
the increasing popularity of electric scooters and motorcycles, automatic
transmissions complement the electric drivetrain technology well, offering
seamless power delivery and maximizing efficiency.
By 2028, Asia Pacific will hold a
significant share of the automotive transmission market. China and India are
expected to lead regional transmission market, with a notable global presence.
Government incentives promoting green vehicles, particularly electric and
hybrid vehicles is expected to drive the transmission market. Manufacturers in
this region, such as JATCO Ltd., Aisin Corporation, and Hyundai Transys,
prioritize energy-efficient components for electric vehicles supported by
government regulations and foreign direct investment norms. Consequently, OEMs
increasingly integrate electric and hybrid vehicles into their product
portfolios.
Key Market Players:
Key players in the market include
Aisin Corporation (Japan), ZF Friedrichshafen AG (Germany), Magna
International Inc. (Canada), JATCO Ltd. (Japan), BorgWarner Inc. (US).
These companies have a strong track record in developing and manufacturing
automotive transmissions and its components. They have facilities and
manufacturing centers across all regions, such as North America, Asia Pacific,
and Europe. They are well positioned to benefit from the growth of new
technologies such as electric and hybrid vehicles in the market as they have
already stepped into the market by developing their portfolio suitable to adopt
the same.
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