Automotive Switches Market

Market Overview

The global automotive switches market revenue was valued at USD 28,658.1 million in 2021. It is expected to reach USD 66,815.6 million by 2030, growing at a CAGR of 8% during the forecast period (2022–2030). The increasing focus on autonomous vehicles and enhanced user comfort has driven a rapid rise in the demand for electronic systems in new automobiles. With the growing popularity of technology-based aftermarket accessories and the integration of advanced features in mid-range and entry-level vehicles, there is a surging demand for automotive electronics.

The global automotive industry has undergone a profound transformation. The ever-increasing demand for passenger safety and comfort compels vehicle manufacturers to create new design experiences by efficiently incorporating new technologies and procedures. The dramatic shift from mechanical to electronic components is anticipated to significantly increase the demand for automotive switches over the forecast period. Switches are essential vehicle components because they regulate all electrical components installed in a vehicle.

Automotive switches are crucial in controlling the vehicle's lighting and nearly all other functions. In addition, they are utilized for engine start/stop applications and several other automotive parts. Increasing technological advancements and rising demand for car accessories installation is anticipated to drive the global market for automotive switches over the forecast period.

Market Dynamics

Market Drivers

Growing Demand for Automotive Switches in Commercial Vehicles

Commercial vehicles are beneficial for promoting urbanization and industrialization, particularly in developing nations around the globe. These components are widely used in passenger and commercial vehicle electrical systems. Manufacturers are installing an increasing number of automotive switches to provide comfortable, convenient, and safe interior settings for vehicles such as buses, trucks, and vans. Several automotive switches have been introduced to the market by companies like Carling Technologies in response to the growing demand for convenient and user-friendly automotive switches.

The product is well-suited for various commercial vehicles due to its three-position lever, multi-position rotary, and momentary push button functions. OEMs integrate electronics strategically to improve user functionality and appeal. Electronic component manufacturers are experiencing an increased demand for cable assemblies, switches, connectors, and other electronic technologies that enhance the safety and comfort of commercial vehicles. As a result, the growing number of automotive switches installed in commercial vehicles is expected to drive the global automotive switches market over the forecast period.

Rising Demand for Automatic Automotive Switches to Boost Market Progress

Automotive switches manage the entire electrical system installed in a vehicle. They are necessary for controlling a vehicle's various functions, including the lights, engine start/stop, mirror controls, etc. Even though manual automotive switches can perform these functions, automatic switches are gaining immense popularity worldwide due to the added convenience they provide by functioning automatically. These switches decrease driver distraction and offer an enhanced safety feature. Automatic switches operate based on the responses sent by various sensors. They are typically installed in luxury automobiles and other high-end vehicles. When the light switch is set to auto, the headlamps turn on automatically in response to low ambient light conditions, such as when the vehicle enters a tunnel at sunset or during rain/snow.

Similarly, automatic switches improve the convenience of driving a vehicle by enabling the auto-dimming mirror action. In auto or self-dimming mirror technology, a front-facing sensor detects low surrounding light from the car's headlights and instructs the rear-view sensor to check for glare. The mirrors dim automatically based on the intensity of the glare, and they clear themselves if the sensors do not detect the glow. This technology is beneficial at night and prevents road accidents. Luxury automobile manufacturers, including Audi, BMW, Mercedes, Ford, Jaguar Land Rover, and others, equip their vehicles with automatic automotive switches to improve the driving experience and passenger safety. Consequently, the increasing demand for automatic automotive switches is anticipated to propel the global market during the forecast period.

Software-defined cars are widely used.

The automobile industry is transitioning from hardware-defined to software-defined vehicles, and the average amount of electronics and software in each vehicle is rising quickly. Government participation and consumer demand for more automatic system control have contributed to a rise in the usage of electronics in automobiles. The need for electronic systems in new automobiles has also been rising quickly as an emphasis on autonomous vehicles and making cars smarter while assuring user comfort has expanded. Additionally, as people buy technology-based aftermarket accessories and technology becomes more readily available in mid-range and entry-level vehicles, there is a rising demand for automotive electronics.

Market Restraints

Use of Haptics and Voice Control Technologies to Restrict Market Growth

The safety of drivers has always been the top priority for automakers worldwide. Due to the numerous accidents that occur annually, incorporating technologies into a vehicle ensures passenger safety. Therefore, the automotive industry is continually searching for ways to enhance passenger safety. Haptic technology is one technology that can reduce driver distraction from infotainment screens and operating different automotive switches. This technology relates to the perception of touch, and the automotive industry is rapidly adopting it to provide drivers with a more intuitive and informed driving experience.

Large automakers are actively working to incorporate haptic technology into their vehicles. Globally, it is available in all new-generation Audi automobiles. Audi refers to it as Multimedia Interface (MMI) Touch Response, in which the central touchscreen provides haptic feedback and a unique sound for each touch. In-car voice control is another technology that is gaining traction in the automotive industry. This technology eliminates the need for the driver to divert their attention away from the road by requiring only voice commands from the driver to activate multiple functions in a vehicle. Numerous global players have adopted this technology, including Mercedes, BMW, Ford, and Toyota. As a result of reducing the number of automotive switches installed in a vehicle, the technologies above are expected to impede the expansion of the global market for automotive switches.

The high price of raw materials

The market for automotive switches is estimated to experience growth restraints during the predicted period due to the volatility of raw material prices and the introduction of touchscreen panels.

Market Opportunities

Growing Implementation of Electronic Systems in Vehicles to Boost Market Opportunities

In recent decades, mechanical switches have been used to control most of a vehicle's functions and applications. Original equipment manufacturers have begun replacing mechanical switches with electrical ones. Numerous manufacturers are installing more electronics in automobiles in response to the growing demand for more convenient and intelligent operation of a vehicle's various functions. They are more responsive, operate quickly, and are cost-effective than mechanical switches. In passenger vehicles and light and heavy commercial vehicles, the use of electronics improves comfort, connectivity, efficiency, and safety. It is anticipated that electronics will contribute significantly to the overall cost of automobiles.

Electronic or electromechanical switches used in modern automobiles, such as rockers, toggles, pushbuttons, and others commonly found in every 12-volt electrical system in an automobile and perform various functions, including turning on the lights and controlling vital systems. With the increasing prevalence of automotive applications, the required performance of switching devices is evolving at an accelerated rate. The adoption of technologically advanced automotive switches is accelerating due to the widespread use of cutting-edge power devices with built-in intelligence features, such as safety and automatic diagnostics, for automobiles. Consequently, the increasing incorporation of electronics into automobiles is anticipated to drive the market for automotive switches over the forecast period.

The rising number of vehicles being produced in developing nations.

The automotive switch market is anticipated to benefit from the rising car production and sales in developing nations like China, India, Vietnam, and others due to rising consumer disposable income, industrialization, and urbanization. The demand for vehicles has increased due to the rapid development of infrastructure and technology in developing nations. According to the International Organization of Motor Vehicle Manufacturers, a global trade organization with its headquarters in Paris, France, the Asia-Pacific area produced almost 35 million automobiles in 2019, making it the continent with the most significant automobile production rates in the world. India and China were the two leading producers. Electronics are the basis of automobile switches, and China is the world's top producer of electronic systems. These factors are anticipated to expand the market for automotive switches during the period.

Regional Analysis

The global automotive switches market is divided into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.

Asia-Pacific's automotive switches industry share is expected to grow at a CAGR of 8% during the forecast period. Demand for automotive switches throughout the region results from the global increase in automobile sales. The expansion of the market for automotive switches is attributable to the rise in vehicle sales in developed North American nations. 

North America has the largest market for LCV automotive switches. In North America, General Motors, Ford, and Fiat Chrysler are among the market leaders for LCVs. These vehicles are starting to come equipped with new features like a camera, better navigation, and more robust engines. Because of the improved features, it is anticipated that the market for automobile switches will expand.

The European region's technological progress aids the development of new products in the automotive switches industry. In the worldwide automotive switch, Europe holds a leading position. The market will expand due to the region's growing need for cutting-edge mobility solutions that offer improved safety and comfort features in newly produced luxury, passenger, and commercial vehicles.

The expanding economies of Asia-Pacific, the Middle East and Africa, and the increase in vehicle production, are propelling the expansion of automotive switches in the region. It is anticipated that these factors will spur the development of the automotive switches market over the forecast period. Asia-Pacific and Europe accounted for approximately 79 percent of the market share in 2019, with Asia-Pacific comprising roughly 59.6 percent of the market share.

Segmental Analysis

The global market is segmented into Type, Design, Vehicle Type, and Sales Channel.

Based on type, the market is segmented into Ignition Switches, HVAC Switches, Steering Wheel Switches, Window Switches, Overhead Console Switches, Seat Control Switches, Door Switches, and Hazard Switches.

The HVAC switches dominate the global automotive switches market and are expected to grow at a CAGR of 9.8% during the forecast period. Heating, ventilation, and air conditioning (HVAC) automotive switches provide a required level of comfort inside an automobile's cabin. It is dominating the others. Luxury automobiles involve motorized flaps and blowers distributed across the cabin. Multifunction switches, the second dominating, bring several functions closer to the driver and facilitate the control of the lights, windshield wipers, and others. The primary benefit of a multi-purpose switch is that it reduces the likelihood of a driver becoming distracted while searching for different controls in a vehicle. Several systems in an automobile, such as the cruise control system, the infotainment system, and other customized system controls that are mounted on the steering wheel, are controlled and operated by steering wheel switches. Steering wheel switches, the third dominating, facilitate the operation of general functions, such as infotainment functions, while enhancing driver safety.

Based on the design, the global market is segmented into Rocker Switches, Rotary Switches, Toggle Switches, and Push Switches.

The push switches segment is expected to grow at a CAGR of 8.6% during the forecast period. Pushbuttons have surpassed all others in popularity as automotive start-stop buttons in recent years. In addition to making starting and stopping a vehicle more convenient, they are designed to make vehicles more secure. As no physical key is required to start a vehicle with a start-stop push switch, vehicle theft is deterred. More than two electrical circuits can be connected using automotive rotary switches as they are the second dominating. They provide superior throw and pole capabilities, making them ideal for automatic climate control, entertainment systems, voice and data communication, and radio frequency selection, among other applications. The most common type of switch controls power windows, defogger grids, heated seats, and other features. Simple rocker switches are standard in automotive systems. This switch, which serves as an electric door lock, turns off when the force is released or when a timer is deactivated in some vehicles.

Based on vehicle type, the global market is divided into Passenger Cars, Light Commercial Vehicles, and Heavy Commercial Vehicles.

The heavy commercial vehicles segment is dominating the global automotive switches market and is expected to grow at a CAGR of 9.7% during the forecast period. Increased demand for safe, convenient, and comfortable automotive interior switches in various vehicle types drives the segment's growth over the forecast period. The addition of electrical systems for enhancing the convenience and performance of the operations of heavy commercial vehicles increases demand for automotive switches. Modern navigation, AI, advanced computing, and sensor technologies offer light commercial vehicle automotive switches growth opportunities. Passenger cars have at least four wheels and up to eight seats, including the driver's seat. Sales are increasing due to electrification and government regulations for global passenger vehicle safety technologies. Passenger car switches are mainly button, rotary, and rocker types for controlling windows, mirrors, A/C, and other vehicle components. Automobiles have short-travel tactile switches.

Based on the sales channel, the global automotive switches market is segmented by OEM and Aftermarket.

The aftermarket segment owns the highest market share and is expected to grow at a CAGR of 9.2% during the forecast period. Aftermarket automotive switch manufacturers make switches for a variety of cars. Aftermarket switches improve a car's performance. Modern technologies like power semiconductors, sensors, and microcontrollers help the auto industry adopt aftermarket switches. It adds capabilities to a vehicle, such as a light bar, and offers technology-based solutions - original Equipment Manufacturers (OEMs) manufacture and market components for integration into another company's products. The switches control automotive functions such as turn indicators, power windows, seats, sensors, and ignition systems.

Recent Developments

• In September 2022, TOKAI RIKA will start a new company in Akita, Japan, to expand operations at its initial base in the Tohoku region.
• In January 2023, The independent automobile aftermarket's top full-range supplier Hella Pagid is working to strengthen its position.
• In January 2023, For the first time, HELLA introduced FlatLight technology into series production as a daytime running light.
• In February 2023, Technologies for a Sustainable Future are Unveiled by Panasonic at CES 2023.
• In February 2023, Advanced motor condition monitoring devices from OMRON will be released in the K7DD-PQ Series.