Automotive transmission systems are components in a vehicle that transmit power from the engine to the wheels. Automatic and manual transmissions are the most common types of transmission systems used in vehicles. Automatic transmissions are gaining popularity as they provide a comfortable driving experience with more advanced features like paddle shifters and different drive modes.
The global automotive transmission market is estimated to be valued at US$ 43.40 Bn in 2024 and is expected to exhibit a CAGR of 6.3% over the forecast period 2023 to 2030.
Key Takeaways
Key players operating in the automotive transmission systems are ZF Friedrichshafen AG, Aisin Seiki Co., Ltd., BorgWarner Inc., and Eaton Corporation plc. The major players are focusing on development of advanced automatic transmission technologies like continuously variable transmission (CVT), dual-clutch transmission (DCT), and automatic manual transmission (AMT) to meet the growing demand. Growing demand for fuel-efficient and high-performance vehicles are creating significant opportunities in the market. Technologies like automated manual transmission and dual-clutch transmission are helping automakers in improving the fuel economy of vehicles.
The increasing production of vehicles equipped with automatic transmissions globally is driving the growth of the automotive transmission market. Government regulations regarding vehicle emissions and fuel economy are accelerating the demand for efficient automatic transmissions. Growing demand for luxury vehicles equipped with advanced automatic transmissions in developing nations is expected to create new revenue pockets for market players.
Market drivers
Stringent fuel economy and emission norms: Stringent emission and fuel economy norms implemented by governments globally are driving OEMs to integrate lightweight and efficient automatic transmission systems in vehicles. This is a key factor driving the demand for advanced automatic transmission technologies.
Growing vehicle production: Rising vehicle production led by increasing vehicle ownership in developing nations is fueling the demand for automotive transmission systems. Asia Pacific region accounts for major share of global vehicle production.
Preference for automatic transmissions: Consumer preference is rapidly shifting towards automatic transmission vehicles due to convenience they offer in traffic conditions. This is propelling the deployment of advanced automatic transmissions in new vehicles.
Current challenges in the Automotive Transmission Systems Market:
The automotive transmission systems market is currently facing challenges due to rising demand for EVs and hybrid vehicles. Traditional automatic and manual transmission systems are facing declining demand as more consumers prefer electric and hybrid powertrains that do not require multi-speed gearboxes. This is negatively impacting established transmission system manufacturers. Another key challenge is the high development costs associated with developing advanced and more efficient transmission technologies. Companies need to make massive investments in R&D to design innovative automatic, automated manual, and continuously variable transmission systems with better fuel efficiency and performance.
SWOT Analysis
Strength: Established global supply chains and economies of scale due to large production volumes. Transmission system manufacturers possess strong technical expertise in designing reliable gearboxes.
Weakness: Huge costs incurred in transitioning to new technologies like EVT and DCT that are replacing traditional automatic transmissions. Declining revenues from gas-powered vehicles as EVs grow in market share.
Opportunity: Growing demand for lower-cost dual-clutch transmissions in Asian and European markets. Increasing focus on designing lightweight transmission systems can enhance vehicle dynamics and fuel efficiency.
Threats: Stiff competition from new local players in emerging economies. Disruptions from startups focusing on innovative EV powertrains not requiring conventional transmissions.
Geographical Regions
In terms of value, the automotive transmission systems market is currently concentrated in Asia Pacific and North America. Asia Pacific accounts for a significant share due to the large automobile production and sales volumes in China, Japan, India, and other Asian countries. The presence of leading transmission manufacturers and tier-1 suppliers in the region has also aided market growth.
The fastest growing regional market for automotive transmission systems is expected to be Europe over the forecast period. This can be attributed to the region’s strong focus on lowering vehicle emissions and transitioning to hybrid and electric technologies. Rising EV sales are driving innovations in transmission architectures and contributing to the industry’s expansion in Europe.
*Note:
- Source: Coherent Market Insights, Public sources, Desk research
- We have leveraged AI tools to mine information and compile it
