Automotive Torque Converter Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Automotive Torque Converter Market was valued at USD 16580 million in 2021 and is expected to reach USD 24192 million by 2027 registering a CAGR of above 6.5% during the Forecasts period (2022 - 2027).

Recent COVID-19 has disrupted the market growth. With lockdowns and travel restrictions, the demand for vehicle has declined. As a result, the growth of automotive parts of automotive industry has been also decline in past two year . This trend is seen in the all segment related to automotive industry.

Over medium term increasing adoption of torque converters in commercial vehicles expected to drive demand in the market over the Forecasts period. The increasing adoption of automatic transmission in commercial vehicles is driven by the increasing construction activities and rising freight and logistics sectors. Futher, Ongoing technological advancements, increasing demand for hybrid electric vehicles expected to further support demand in the market.

The torque converter in an automatic transmission serves a purpose similar to a clutch in a manual transmission. The demand for torque converters is directly related to the increased use of automatic transmission in modern vehicles.

Besides these factors, increasing vehicle fleet, development of efficient transportation and logistics industry, and the need to enhance the driving experience by manufacturers are expected to boost the Global Automotive Torque Converter Market growth in the Forecasts period. However, high maintenance costs and the risk of malfunctioning automotive torque converts may hinder the market growth in the Forecasts period.

North America followed by Europe and Asia-Pacific region anticipated to have significant growth during the Forecasts period, mainly due to the early adoption of these converters and the high demand for premium vehicles in the region. Additionally, the market growth in these regions projected to be driven by the growing adoption of automatic transmission systems in medium and heavy-duty trucks over the Forecasts period.

Key Market Trends

Increasing Adoption of Automatic Transmissions in Commercial Vehicles

With the improvement in technology, fully automatic commercial vehicles are as fuel-efficient as manual commercial vehicles. Automatic Transmission provides the user with a fatigue-free experience as the user is free from frequent gear shifting. Ease of driving, especially in heavy traffic is creating a demand for an automatic transmission. Over the years many major automotive companies are focusing on technologies to improve automatic transmission in commercial vehicles.

• In Jan 2022, The iTC torque converter from Schaeffler represents an entirely new generation of components that are lighter and reduce vibrations. A key feature of the iTC - or “integrated torque converter”, to give it its full name - is a lock-up clutch that is integrated into the converter’s turbine. This not only makes the system lighter, it also creates space for more efficient torsion dampers, such as the centrifugal pendulum-type absorber

In the light of increasing commercial vehicle sales and higher penetration of automatic transmission systems, key players have introduced some innovative solutions for commercial vehicles. For instance,

• ZF’s TraXon offers more torque, an optimal gear ratio spread and the best efficiency in its class, thus setting the bar for transmissions designed for cranes, commercial and special vehicles. The TraXon Torque variant which integrates a torque converter with a dry clutch as a launch element.

Such aforementioned factors and developments anticipated to poise positive outlook for the market over the Forecasts period.

North America Likely to Play Significant Role in the Development of Market

North America was estimated to play key role in development of market during the Forecasts period. The prospects for growth of the torque converter market in America will be significantly affected by the increased adoption of automatic transmission in passenger cars as well as heavy-duty and medium-duty commercial vehicles. For instance,

• In 2021, Around 12 million commercial vehicles were sold in United States, up from approximately 11.5 million units reported in 2020. This type of vehicle includes motor vehicles used for transporting goods or paid passengers. Further, In 2021 the year started positively for the USA market, in fact, in Q1 3.97 million units have been sold, reporting a 13.2%, followed by an impressive 46.9% increase in sales in Q2 with 4,35 million units compared to previous year.

High fuel efficiency, comfort, ease of driving, and low driving skill requirement will compel the fleet owners to opt for automatic transmission in these vehicles.The high growth rate in these regions is mostly attributed to the technological advancement and easy adoption of the new technology in countries such as U.S, Canada, etc. Apart from North America Europe and Asia-Pacific regions are also witnessing notable growth supported by active engagement of key players and automotive OEMS launch of latest car models with these torque converter technologies to attract consumers. For instance,

• Volkswagen unveiled the 2022 Virtus in India with some changes compared to the model, which is on sale in the international markets. Volkswagen to offer two petrol engines with the Virtus. The 1.0L turbo petrol engine will produce 110PS of power and 175Nm of torque, mated to either a 6-speed manual or a 6-speed torque converter automatic transmission. The 1.5L turbo petrol engine will produce 150PS of power and 250Nm of torque, mated to either a 6-speed manual or a 7-speed dual-clutch automatic transmission.

Thus, aforementioned factors indicate the active progressions happening across these regions and hence such developments expected to contribute for overall development of the market during the Forecasts period.

Competitive Landscape

The automotive automatic transmission market is highly consolidated, with major players, like Exedy, Borgwarner, Aisin Seiki, Valeo, and Others dominating the market. These players are focusing on designing various growth startegies to improve their share in the market. Some of the latest developments like expansion, patnerships, product launches, etc have been briefed below for better understanding of the market. For instance,

• In September 2020 The Skoda Rapid automatic was launched with automatic transmission with their turbo petrol engines in India. The Rapid AT will compete with the Hyundai Verna turbo DCT, Honda City CVT and the Toyota Yaris CVT. The only other torque converter automatic happens to be the Maruti Suzuki Ciaz but then it uses a 4-speed AT.

The market has also witnessed numerous partnerships especially between players in automatic transmission be it OEM-OEM (Example - Ford and GM patnerhsip) or OEM-Suppliers (Example - BMW and ZF, Land Rover and ZF, Chrysler and ZF, Allison and China National Heavy Duty Truck Group, etc.). Most of the partnerships have centred around building efficient, 8,9 and even 10 speed transmission which can be used in multiple vehicle platforms.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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