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Global Powertrain Market Reaping Benefits of a Booming Automotive Sector

Blog Description

Powertrains are one of the most essential components of any vehicle, irrespective of size, because it generates power and gives it the ability to move. The powertrain system includes drive shafts, differentials, engine, transmission, and final drive, and is present in all types of vehicles: light commercial vehicles, heavy commercial vehicles, construction equipment, farm tractors, cars, infantry carrier vehicles, off-road vehicles, and defense vehicles.

The global powertrain market is fueled by stringent government norms pertaining to emission levels, fuel efficiency, and vehicular weight, growing demand for environment-friendly vehicles, and availability of technologically advanced powertrain systems. Developing a powertrain system that works on alternative fuel, is noise-free and environmentally-friendly, and has the advantages of a hybrid vehicle presents massive opportunities for players in this market. According to a report by Transparency Market Research, the global powertrain market is projected to witness a 5.30% CAGR from 2014 to 2020, rising from a value of US$365.6 bn in 2013 to US$524.6 bn by 2020.

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Here’s a look at the status of some of the regional powertrain markets.

Asia Pacific Emerges as Most Promising Powertrain Market: Of the four regional powertrain markets, Asia Pacific emerges as the leading component and holds immense potential for future growth. Rise in vehicle sales, development of the industrial and construction sectors, and the growing demand for automated transmission are key forces that boost the powertrain market in Asia Pacific, especially in countries such as Japan, China, India, and South Korea. Vehicle manufacturers such as Honda, Toyota, and Hyundai, and tier 1 suppliers such as GKN Plc, Aisin Seiki, and JTEKT boast of a strong presence in this region, adding support to the powertrain market. Stringent emission norms encouraging vehicle manufacturers to bring down the overall weight of the automobile will also boost the market.

North America Powertrain Market Focused on Luxury and Comfort: Similar to other regional markets, the trend of forward-wheel drive vehicles enjoys the most impressionable position at present. However, given that consumers in this part of the country are more inclined towards luxury and comfort, front-wheel drive and rear-wheel drive vehicles are being replaced with all-wheel drive vehicles. Of the main country-wise segments in North America – namely Canada, the US, and Mexico, the US enjoys the majority share of the powertrain market in terms of both value and volume.

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Recovery of Europe Powertrain Market in the Cards: The economic slump of 2009 has had a catastrophic impact on the European economy, which has negatively affected almost all industries and verticals. However, gradual but sure recovery is certain over the coming years, allowing the powertrain market to witness stable growth. Strict norms pertaining to fuel economy and emission have forced vehicle manufacturers to downsize engines, thereby improving fuel efficiency and overall performance, and curbing emissions. This, in turn, is anticipated to propel the powertrain market in Europe.