Mexico Automotive Parts Die Casting Market - Analysis of Growth, Trends, and Forecast (2020 - 2025)

The Mexican Automotive Die Casting Market is expected to register a CAGR of over 6% during the forecast period (2020 - 2025).

• The market studied is largely driven by supply chain complexities in the die casting industry, expanding the automotive market, increasing penetration of die casting parts within the current automotive industry, and future use of die casting in electric vehicles.
• The automotive industry has witnessed dramatic growth over the past couple of years. Owning to inviting new innovation, it has never restricted itself. At present, automotive manufacturers are striving to meet the targets for highly tensile chassis frames and strong automotive parts that are long-standing, lightweight and cost-effective.
• CAFÉ standards and EPA policies, to cut down the automobile emissions and increase fuel efficiency, are driving the automobile manufacturers to reduce the weight of the automobile, by using lightweight non-ferrous metals. Subsequently, the use of die-cast parts as a weight reduction strategy is acting as a major driver for the market studied.
• Rules imposed by the OSHA and the initiatives by the NADCA to improve the technical workforce in the die casting industry are expected to improve the overall production of the market studied.

The automobile industry is highly dependent on the Environment Protection Agency (EPA) regulations, owing to the high emissions of the automotive units. The move by the EPA to raise the miles per gallons (mpg) standards to 54.5 mpg by 2025, has actually helped the die casting industry, as the automotive industry concluded that the only way to get to those mileage standards is by manufacturing lightweight vehicles.

Key Market Trends

Vacuum die casting is expected to witness a high growth rate

There have been significant developments and improvements in the conventional die casting process. Currently, the ultra-high-vacuum die casting process is applied for producing large and thin component parts, such as space-frames and pillars, which are usually welded to automobile chassis.

Electrical and hydraulic components in an automobile work simultaneously. Reliability and quality are given prime importance in transmission parts. The transmission system in an automobile is a complex combination of mechanical functions. It is prone to extreme conditions and environments. This enhances the importance of integrity. Valve bodies, stators, and clutch pistons are some of the commonly die casted transmission parts in the automotive industry.

It has been accepted that ultra-vacuum die casting produces better weldable automotive products than most of the die casting processes. However, products produced in this process are large and require huge-sized die casting machine, like 2,500-4,000 metric ton of die clamping force. This impacted the popularity of the ultra-high-vacuum die casting process among OEMs and large die casters.

However, vacuum die casting production process eliminates the air from the mold and allows the front of molten metal to merge freely without forming any shuts or pores, which is a major issue in pressure die casting process.

A sudden shift from pressure die casting to vacuum may not be possible due to the higher productivity and ease of manufacture of the automotive die casting parts, which employ pressure die casting method. However, this change is gradual and expected to continue to increase, during the forecast period.

Rising Demand for Vacuum Die Casting and Enactment of Stringent Emission Regulations

Globally, countries have formulated stringent emission norms to cater to the cause of reducing global warming. Efforts are being made by governments worldwide, to minimize the negative effects of global warming and reduce the carbon footprint.

The European Union introduced the Euro VI norms in 2014, according to which, nitrogen oxide emissions must be below 0.4g/KWh and particulate emissions must be below 0.01g/KWh. Japan is in the process of introducing new emission norms that are based on the Euro VI norms.

A number of countries are implementing emission standards, OEMs worldwide are expected to explore new technologies that help in reducing emission in automobiles. The freight companies and fleet owners are extensively moving toward technologies, which are expected to reduce the average emission rate.

Earlier, pressure die casting was the majorly employed production process. However, the vacuum die casting process has been gaining popularity over the past couple of years, due to its better welding characteristics, higher mechanical strength, and lower gas porosi

Competitive Landscape

The Mexico market for die casting is highly fragmented with many regional small-medium scale players from the developing countries entering the market.

Major recognized players, such as Nemak, Georg Fischer Automotive, Ryobi Die casting, Rheinmetall AG, Form Technologies Inc. (Dynacast), and Shiloh Industries together accounted to over 16% of the overall global market share.

Koch Enterprises (Gibbs Die Casting Group), Linamar Corporation, Bocar Group, Endurance Group, Sandhar technologies, Sundaram Clayton Ltd. and Rockman Industries are few other key players in the market.

These key players have focused their revenues on R&D to come up with better production processes and alloys. This strategy may assist in the production of premium quality die cast parts for the global automotive and industrial sectors. Key players have also expanded their reign globally by various mergers, expansions, partnerships, joint-ventures, and acquisitions. For instance, Rheinmetall AG development activities were very diverse in 2018. In the field of aluminum casting, the company focused on the development and production activities relating to engine blocks, structural and chassis parts, and components for electromobility with their joint venture partner HUAYU Automotive Systems Co. Ltd (HASCO).

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