Global Automotive Differential Market Grows Steadily at a CAGR of 6.5 %

Introduction

The differential is a crucial component of an automobile's drivetrain, enabling distinct drive wheels to execute turning and driving functions. A differential is a system that divides the engine's torque into two outputs, allowing each work to spin the vehicle's wheels at a different speed. Every modern passenger, commercial, and the electric car has a differential. All-wheel-drive automobiles necessitate a differential between each pair of driving wheels, i.e., between the front and back wheels. The need for differentials in automobiles is wholly contingent on automotive manufacturing processes.

Decreased automotive production and sales over the previous two years and rising production of automobiles with in-wheel electric motors are expected to restrict the market growth during the forecast period. Another essential tactic for gaining a competitive advantage in obtaining a contract or agreement. It is projected that these factors will soon create a more favorable atmosphere for market expansion.

Market Dynamics

Increasing Frequency of All and Four-Wheel Drive Automobiles and Demand for Commercial Vehicles Drives the Global Market

Significant technological developments in automobile drivetrains, powertrains, safety, and vehicle stability have all increased the operational efficiency of automobiles. The end-consumer demand outlook has shifted toward more luxury, enhanced comfort, and enhanced driving dynamics. Four-wheel drive (4WD) and all-wheel drive (AWD) cars can attain higher levels of safety and vehicle dynamic performance due to the changing needs of consumers. In addition, original equipment manufacturers (OEMs) are focusing on developing these drive systems to suit the ever-changing needs of end customers. In recent years, the market share of all-wheel drive (AWD) and four-wheel drive (4WD) automobiles has increased significantly, and industry analysts expect this trend to continue in the coming years. These drive systems require two or three differential assemblies to perform their driving functions.

It is predicted that the increase in demand for commercial vehicles in developing nations will demonstrate spectacular growth in the coming years due to urbanization and increased industrial production. For instance, the commercial vehicle market of the Indian automotive industry witnessed an exceptionally high growth rate which is valid for all three categories of commercial vehicles: light, medium, and heavy. Commercial vehicles, often rear-wheel-drive vehicles, need to have differential assemblies capable of excellent performance in driving activities.

Production of Electronically Controlled Limited-Slip Differentials Creates Tremendous Opportunities

A vehicle with an electronic limited-slip differential has better traction, which is advantageous on dry and wet roads. This differential offers several advantages, such as improved control and handling, excellent performance, and improved traction in slippery weather. The development of electrically limited-slip differentials is the principal focus of R&D at several of the world's leading automobile manufacturers. For instance, Hyundai Wia Corporation expanded the production capacity of its Changwon plant in Korea to manufacture electronically limited-slip differentials (ELSD).

In addition, Eaton has released the most recent generation of their electrically limited-slip differential, a rapid-response device for controlling traction. ZF has also created a brand-new networked ELSD rear axle transmission. This sort of transmission is primarily designed for sport and off-road vehicles. This unique differential is fully networked with the vehicle's braking system, which improves the vehicle's on-road and off-road driving characteristics, comfort, and stability.

Regional Analysis

Leading automakers are creating automobile differential systems to improve traction, stability, and performance, driving the Asia-Pacific market. Continuous advancements in automobile differentials drive industry expansion. The development of electrically regulated slip differentials represents a further market expansion possibility. The contribution of this territory to the global market is relatively modest due to expansion in the automotive industry and increased demand for commercial cars.

The United States, Canada, and Mexico will experience a substantial increase in differential demand. Leading luxury manufacturers deliver new vehicles with enhanced amenities and innovative differentials, stimulating the North American automobile differential market. Porsche Cars North America, Inc. debuted the 718 Boxster T and 718 Cayman T with a limited-slip differential. With the development of innovative technologies for enhanced vehicle control and dynamics, the differential market in North America is anticipated to expand. The expanding automobile industry and demand for commercial vehicles will drive the European automotive differential market. OEMs manufacture differentials. Audi’s luxury automobile manufacturer introduced a new Audi Q8 SUV S variant featuring a torque-vectoring rear differential and limited-slip center differential in Europe.

Key Highlights

• The global automotive differential market was valued at USD 19.76 billion in 2021. It is projected to reach USD 34.83 billion by 2030, growing at a CAGR of 6.5% during the forecast period (2022–2030).
• Based on drive type, the global automotive differential marketis classified into Front-Wheel Drive (FWD), Rear-Wheel Drive (RWD), and All-Wheel Drive (AWD). The front-wheel-drive (FWD) is the most dominant automotive differential and is expected to grow at a CAGR of 6.2% during the forecast period.
• Based on vehicle type, the global automotive differential marketis classified into Passenger Car, Commercial Vehicle, And Electric Vehicle.
• Based on type, the global automotive differential marketis classified into Open, Locking, LSD, ELSD, And Torque Vectoring. Open locking is the superior automotive differential and is expected to grow at a CAGR of 5.6 % during the forecast period.
• The global automotive differential market is primarily classified into three regions, namely North America, Europe, Asia-Pacific, and Asia-Pacific was the highest contributor to the global automotive differential market and is expected to grow at a CAGR of 6.2% during the forecast period.

Competitive Players

Competitive Players

The global automotive differential market’s major key players are

• American Axle & Manufacturing Inc
• BorgWarner Inc
• Dana Incorporated
• Eaton
• Hyundai WIA Corporation
• JTEKT Corporation
• Linamar Corporation
• Melrose Industries Plc
• Schaeffler Group
• ZF Friedrichshafen AG

Recent Developments

Market News

• In February 2022, AAM Invests in Autotech Ventures, Will Leverage Access to New Mobility Opportunities.
• In May 2022, BorgWarner to Provide eMotors for Leading EV Brand in China.
• In April 2022, Hyundai Wia plans to conquer Europe with the Tech Cube.
• In May 2022, Schaeffler Group starts the new year with an excellent first quarter, Automotive Technologies, with 2.0 billion euros in order intake in E Mobility BD.

Segmentation

Global Automotive Differential Market: Segmentation

By Drive Type

• Front-wheel drive (FWD)
• Rear-wheel drive (RWD)
• All-wheel drive (AWD)

By Vehicle Type

• Passenger car
• Commercial vehicle
• Electric vehicle segments

By Type

• Open
• Locking
• LSD
• ELSD
• Torque vectoring

By Regions

• North America
• Europe
• Asia-Pacific
• LAMEA