Automotive Test Equipment Market

Market Overview

The global automotive test equipment market revenue was valued at USD 3.33 billion in 2023. It is estimated to reach USD 4.84 billion by 2032, growing at a CAGR of 4.25% during the forecast period (2024–2032). Due to the rise in road accident cases in recent years, there has been a rise in the demand for vehicle safety. This is anticipated to drive the global market growth. In addition, the rising sales of EVs in comparison to traditional internal combustion engine vehicles is further fostering the market expansion. Moreover, the market leaders are launching innovative automotive testing equipment to push new technologies and enhance vehicle performance, which is estimated to generate market growth opportunities.

Automotive test equipment encompasses tools and systems crucial for evaluating vehicles and components. From assessing performance and safety to ensuring regulatory compliance, these devices play a vital role in the automotive industry. Performance tests gauge engine power, acceleration, and fuel efficiency, while safety evaluations focus on crashworthiness and safety systems. Emissions testing measures exhaust output to adhere to environmental standards. Durability tests simulate real-world conditions to assess longevity and reliability. Component testing verifies the performance of individual parts like engines and brakes. Specialized equipment includes dynamometers, emissions analyzers, crash test dummies, and data acquisition systems. Automotive test equipment ensures vehicles meet quality standards and regulatory requirements, fostering safety, reliability, and innovation in the automotive sector.

Market Dynamics

Market Drivers

Emphasis on Vehicle Safety

The emphasis on vehicle safety is a significant driver for the automotive test equipment market. With increasing awareness of road safety and stringent regulations, there is a growing demand for testing equipment to assess vehicle safety features and crashworthiness. Automotive manufacturers must ensure their vehicles meet rigorous safety standards and incorporate advanced safety technologies such as airbags, collision avoidance systems, and pedestrian detection systems.

Moreover, testing equipment such as crash test dummies, impact sleds, and advanced simulation software are essential for evaluating vehicle safety performance. According to WHO, around 1.19 million individuals die annually due to road traffic accidents. As a result, the emphasis on vehicle safety fuels demand for automotive test equipment and services to improve safety and decrease the risk of road accidents.

Growing Demand for Electric Vehicles (EVs)

The increasing demand for electric vehicles (EVs) is driving significant changes in the automotive industry and fueling demand for specialized automotive test equipment. EVs present unique challenges and requirements compared to traditional internal combustion engine vehicles, necessitating dedicated testing solutions. Automotive test equipment for EVs includes tools and systems for evaluating battery performance, charging infrastructure, electric drivetrains, and overall vehicle efficiency.

The IEA reports that the electric car market is growing exponentially, with sales surpassing 10 million in 2022. In just three years, the share of electric vehicles in total sales has increased by over three times, from roughly 4% in 2020 to 14% in 2022. More than 2.30 million electric cars were sold in the first quarter of 2023, a 25% rise over the same period the year before. As the EV market expands and changes, there will likely be a greater need for automotive test equipment designed specifically for electric vehicles. This will create opportunities for suppliers and manufacturers in the automotive testing sector.

Market Restraint

High Cost

The high cost of automotive test equipment significantly restraints the market, impacting both potential buyers and suppliers. For automotive manufacturers, investing in sophisticated testing equipment entails substantial upfront expenses, which can strain budgets and financial resources, particularly for smaller companies or testing facilities. The costs associated with installation, maintenance, calibration, and training further add to the overall expenditure.

The high cost of creating and producing cutting-edge testing technologies results in higher prices for testing equipment suppliers' goods. This may discourage prospective purchasers from making purchases of new machinery or updating current systems, particularly in uncertain economic times or when money is tight. Moreover, intense competition among equipment suppliers exacerbates pricing pressures as companies strive to maintain profitability while offering competitive pricing to attract customers. Therefore, the high cost of automotive test equipment represents a significant barrier to entry and adoption, limiting market growth and innovation within the industry.

Market Opportunities

Introduction of Automotive Test Equipment

The key market players are introducing new and advanced automotive testing equipment to develop new technologies and improve vehicle performance. For instance, in February 2023, Mustang Advanced Engineering (MAE), a test equipment manufacturer, provided an end-of-line (EOL) test stand to Lion Electric, a maker of zero-emission vehicles such as electric commercial urban trucks and buses for schools and mass transit. The chassis dynamometer, created by MAE, can test heavy-duty electric vehicles with single or tandem axles. A test stand has been created for quality control testing of electric vehicles and buses used on roads.

Furthermore, in October 2022, Expleo, a provider of engineering, technology, and consulting services, revealed the development of a comprehensive cyber-resilience testing platform for the automotive sector. The ExpleoSmeeta Briefcase includes a cybersecurity testing framework called ExpleoSmeeta and hardware components designed for conducting security assessments, cyber forensics, and penetration tests in automotive applications. Modern automobiles operate using 100 million lines of code and many wireless connections. Therefore, software-dependent transportation systems must prioritize security measures to ensure the vehicle's and its passengers' safety. This factor creates opportunities for market expansion.

Regional Analysis

Based on region, the global automotive test equipment market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

Asia-Pacific's automotive test equipment market share is expected to expand substantially during the forecast period. Asia-Pacific leads the market, owing to technological advancement, rising incidents of road accidents, progressive improvement in safety systems, and increasing consumer awareness about safety issues. According to Frontline, in 2022, road accidents rose by 11.9% compared to 2021. The number of fatalities and injuries from road accidents rose by 9.4% and 15.3%, respectively. Moreover, the rising sales of EVs in various parts of Asia-Pacific are also boosting the market expansion. China has almost 50% of the electric automobiles on roads globally, as the International Energy Agency reported. China experienced an 82% rise in new electric vehicle (EV) sales in 2022, representing nearly 60% of worldwide EV purchases.

Furthermore, the regional market players are introducing novel testing equipment with enhanced capabilities. For instance, in May 2023, an agreement was signed to provide advanced testing services by the National Automotive Test Tracks, or NATRAX, Asia's largest proving ground with 14 advanced track facilities in Indore for vehicle testing, and ATS, a major Gurgaon-based supplier of testing equipment and engineering services to the automotive industry. The two organizations plan to provide testing and certification services in ADAS, road-load data acquisition (RLDA), and vehicle dynamics to OEMs, technology, and component suppliers in the country, as outlined in the MoU. Both organizations want to use each other's strengths, with NATRAX providing its infrastructure and ATS contributing its cutting-edge equipment for testing advanced driver assistance systems (ADAS) in India. Consequently, all these factors boost the regional market growth.

Europe is a prominent market region due to well-established automobile companies such as BMW, Mercedes, Audi, and Volkswagen. Moreover, with the growing acceptance of safety certification, such manufacturers are now providing excellent safety features, which are adequately tested based on every safety criterion. Moreover, the key players in the market are involved in strategic initiatives like mergers and acquisitions, collaborations, and expansions. For instance, in December 2020, French testing group UTAC CERAM and British business Millbrook agreed to consolidate their operations to form a new group focused on vehicle testing, homologation, and developing technologies for autonomous, connected, and electric vehicles. Such factors boost the regional market expansion.

Segmental Analysis

The global automotive test equipment market is segmented by type, vehicle type, and application tool.

Based on type, the global automotive test equipment market is divided into engine dynamometers, chassis dynamometers, vehicle emission test systems, and wheel alignment testers.

A chassis dynamometer is a testing device used to evaluate the performance of vehicles while they remain stationary. It consists of a flat platform onto which the vehicle is secured, with rollers or belts underneath to simulate road conditions. During testing, sensors and instrumentation measure parameters such as engine power, torque, emissions, and fuel consumption. Chassis dynamometers enable engineers and technicians to conduct controlled tests and simulations, evaluating vehicle performance, emissions compliance, and drivability under different conditions. They are essential tools in automotive research, development, and testing facilities, providing valuable insights into vehicle performance and helping optimize design, efficiency, and compliance with regulatory standards.

Based on vehicle type, the global automotive test equipment market is divided into passenger vehicles, light commercial vehicles, and heavy commercial vehicles.

Automotive test equipment ensures the safety, reliability, and performance of heavy commercial vehicles (HCVs) like trucks and buses. It facilitates various critical tasks, including performance evaluation, emissions testing, durability assessment, safety verification, and component testing. By utilizing tools such as chassis dynamometers, emissions analyzers, suspension testers, and crash test equipment, manufacturers can ensure that HCVs meet regulatory standards, performance requirements, and customer expectations. These tests help identify defects, weaknesses, or areas for improvement in vehicle design, components, or systems, enabling manufacturers to address issues early in development and deliver high-quality, dependable vehicles to the market. Ultimately, automotive test equipment is crucial in enhancing the safety, efficiency, and reliability of heavy commercial vehicles for operators and passengers alike.

Based on application tools, the global automotive test equipment market is bifurcated into handheld tools, mobile device tools, and PC/laptop-based tools.

Handheld tools for automotive test equipment are portable devices used to diagnose, measure, and analyze vehicle performance and functionality. Common tools include OBD-II scanners for retrieving diagnostic trouble codes and real-time data, multimeters for electrical troubleshooting, compression testers for assessing engine health, and brake fluid testers for analyzing brake fluid conditions. Tire pressure gauges ensure proper tire inflation, while battery testers diagnose battery health. Moreover, diagnostic smoke machines detect leaks in-vehicle systems, and fuel pressure testers measure fuel system pressure. These tools are essential for automotive technicians and DIY enthusiasts to perform diagnostic and maintenance tasks, ensuring vehicles operate reliably and safely.

Recent Developments

February 2024- Bloomy launched the Desktop BMS HIL Test System solution to enhance the productivity of battery engineering teams by providing automated test platforms and control systems. The technology enables development teams to access the testing capabilities of hardware-in-the-loop (HIL) design laboratories on their PCs, aiming to enhance productivity and decrease time-to-market for projects such as EVs and drones.

March 2023- Mustang Advanced Engineering (MAE), a U.S. company that produces high-quality testing equipment, such as electric vehicle testing tools for research and development, showed its latest e-mobility dynamometer installation at the University of Windsor in Ontario, Canada. The MAE-AWD-500-AC/EC-LEGACY-BG chassis dynamometer was specifically designed to fulfill the school's needs for researching electric vehicles such as BEV, PHEV, and FCEV.