Automotive Engine Market Size, Share & Trends Analysis Report By Placement Type (In-line, V-type, W Engine), By Fuel Type (Diesel, Gasoline), By Vehicle Type, By Region- Global Industry Analysis, Share, Growth, Regional Outlook and Forecasts, 2024-2033

The global automotive engine market size was exhibited at USD 95.00 billion in 2023 and is projected to hit around USD 124.00 billion by 2033, growing at a CAGR of 2.7% during the forecast period of 2024 to 2033.

Key Takeaways:

• North America accounted for a revenue share of more than 32% in 2023.
• The in-line segment held the highest market share of 45.04% in 2023.
• Gasoline held the highest market share of over 35% in 2023, attributed to the benefits offered by gasoline engines, such as less noise and vibration, as well as low fuel prices.
• Passenger cars held the highest market share of more than 67% in 2023.

Automotive Engine Market by Overview

The global automotive engine market is a dynamic and rapidly evolving industry that plays a pivotal role in the automotive sector. Automotive engines serve as the heart of vehicles, powering them with the necessary force to drive efficiently and effectively. This overview aims to provide a comprehensive understanding of the current state of the automotive engine market, highlighting key trends, challenges, and opportunities that shape its landscape.

Automotive Engine Market Growth

The growth of the automotive engine market is propelled by several key factors. Firstly, the continual rise in global vehicle production, fueled by increasing consumer demand and technological advancements, serves as a primary driver for the market. As automotive manufacturers strive to meet growing transportation needs, the demand for efficient and high-performance engines remains robust. Secondly, stringent emission regulations worldwide have spurred innovation in the sector, leading to the development of fuel-efficient and environmentally friendly engines. Adherence to these regulations has become a pivotal factor for market players, driving advancements in engine technology. Together, these factors contribute to a dynamic landscape in the automotive engine market, fostering growth, innovation, and sustainability within the industry.

Automotive Engine Market Report Scope

Automotive Engine Market Dynamics

• Growth Drivers:

The automotive engine industry is driven by a number of growth drivers, the most important of which is the continued expansion in worldwide vehicle production. Fueled by rising consumer demand and technical developments, this surge in production highlights the critical role engines play in servicing the world's growing transportation needs. Additionally, stringent emission regulations have emerged as a critical driver, necessitating the development of fuel-efficient and eco-friendly engines. Manufacturers are compelled to invest in research and innovation to ensure compliance, driving the overall growth of the automotive engine market.

• Challenges:

Amidst the dynamic landscape of the automotive engine market, challenges arise prominently from the ongoing trends in vehicle electrification. The growing emphasis on electric vehicles poses a considerable challenge to traditional internal combustion engines, urging manufacturers to adapt and invest in alternative technologies. Additionally, supply chain disruptions, influenced by factors such as geopolitical events and the ongoing semiconductor shortage, present a significant hurdle. 

Automotive Engine Market Restraint

• Electrification Trends:

One of the primary restraints in the automotive engine market stems from the accelerating shift towards vehicle electrification. The increasing popularity of electric vehicles (EVs) poses a significant challenge to traditional internal combustion engines. As governments and consumers prioritize sustainability, automotive manufacturers face the need to adapt their strategies, invest in electric propulsion technologies, and navigate the complexities associated with the transition. 

• Supply chain disruptions:

The automotive engine market faces a notable restraint due to supply chain disruptions. Factors such as geopolitical events and the ongoing semiconductor shortage contribute to fluctuations in the supply chain, impacting the production and availability of automotive engines. Manufacturers grapple with uncertainties in sourcing essential components, leading to production delays and increased costs. To mitigate these challenges, industry stakeholders must implement robust supply chain management strategies, fostering resilience and adaptability to ensure a steady flow of components essential for engine production.

Automotive Engine Market Opportunity

• Alternative Fuels and Sustainable Technologies:

A notable opportunity in the automotive engine market lies in the exploration and development of alternative fuels and sustainable technologies. As the industry undergoes a paradigm shift towards environmental consciousness, there is a growing demand for engines that operate on cleaner fuels such as hydrogen, biofuels, and synthetic fuels. Manufacturers have the chance to capitalize on this trend by investing in research and development to create engines that not only meet emission standards but also contribute to a more sustainable and eco-friendly transportation ecosystem.

• Advanced Connectivity and Autonomous Driving:

The integration of advanced connectivity features and the rise of autonomous driving present a compelling opportunity for the automotive engine market. Modern engines are becoming integral components of intelligent, connected vehicles. As vehicles become more sophisticated and reliant on data-driven technologies, there is an increasing need for engines that can seamlessly integrate with advanced systems. 

Automotive Engine Market Challenges

• Vehicle Electrification Challenges:

A prominent challenge facing the automotive engine market is the accelerating trend toward vehicle electrification. The increasing demand for electric vehicles (EVs) poses a significant hurdle for traditional internal combustion engines. Manufacturers must navigate the complexities associated with developing and integrating electric propulsion technologies. This transition requires substantial investments in research and development, retooling of production facilities, and addressing concerns related to charging infrastructure. 

• Supply chain disruptions:

The automotive engine market is confronted with challenges arising from supply chain disruptions. Factors such as geopolitical events, natural disasters, and the ongoing semiconductor shortage contribute to significant fluctuations in the supply chain. These disruptions impact the timely sourcing of critical components, leading to production delays, increased costs, and potential supply shortages.

Segments Insights:

Placement Type Insights

The in-line segment held the highest market share of 45.04% in 2023. In-line engines are the most common type of engine for passenger cars. These engines can be seen in family-level hatchback cars to luxury sedans like BMW and Mercedes due to their easy and inexpensive manufacturing along with their easy installation process. Thus making it a preferred choice for OEMs.

The W-engine segment is expected to register a CAGR of 3.3% from 2023 to 2033. In W-engine, three or four sets of cylinders can be coupled to one or two crankshafts. Because W-engines take up less space and produce greater power, they are employed in heavy-duty trucks and luxury cars. The V-type engine is the most used in all high-performance vehicles. Almost all high-performance car manufacturers, such as Ferrari, Alfa Romeo, and Mercedes-Benz, opt for the V-engine layout.

In-line engines are the most common engines used in passenger cars, mostly seen in family-level hatchbacks and luxury sedans like BMW and Mercedes, due to their easy and inexpensive manufacturing and easy installation process. Thus making them a preferred choice for OEMs.

Fuel Type Insights

Gasoline held the highest market share of over 35% in 2023, attributed to the benefits offered by gasoline engines, such as less noise and vibration, as well as low fuel prices. Gasoline engines are most commonly used in passenger vehicles due to their advantages, such as efficiency, cost-effectiveness, and lightweight. High-speed gasoline engines are less noisy. Thus, these are the major growth drivers for the adoption of gasoline engines.

Diesel is expected to expand at a CAGR of 3.1% over the forecast period. Diesel engines are used in various equipment and vehicles, from medium-duty trucks to overseas cruise ships and power generators. Factors such as high fuel efficiency, resulting in low operating costs and reliability, have made diesel engines a preferred option. As diesel engines run at a much slower revolution per minute (RPM), less wear and tear results in a longer engine life cycle. These technical advantages have made diesel engines a preferred choice among manufacturers, driving the growth of the segment.

Vehicle Type Insights

Passenger car held the highest market share of more than 67% in 2023. As the ownership of vehicles increases around the world, OEMs are developing various engines based on different kinds of passenger car segments. Multi-fuel engines, Variable Valve Technology (VVT), turbocharger technology, and Common Rail Direct Injection (CRDI) are examples of technological breakthroughs in automobile engines that deliver the high power and torque necessary for luxury category vehicles.

OEMs are developing engines that are lightweight and capable of producing high power. Deployment of advanced engines in passenger cars and growing demand for passenger car sales are among the factors propelling the market growth of the vehicle type segment.

The commercial vehicle segment is expected to grow at a CAGR of around 3.0% over the forecast period. The growth can be attributed to the rising demand for trucks across the logistics sector. Logistics is one of the key industries used to transport goods. The use of trucks and trailers to transport goods has increased significantly. With changing lifestyles and growing urbanization, people are more inclined to get goods and products delivered to them. All these factors bode well for the market's growth.

Additionally, the potential implementation of a vehicle scrappage program, increased budgetary allocation towards the development of infrastructure in rural sectors, stringent implementation of regulatory norms, particularly those related to vehicle length & overloading, and recommencement of mining activities in certain areas leading to increased demand for commercial vehicles. The developing infrastructure sector, coupled with the rising disposable incomes of consumers, is propelling the demand for commercial vehicles.

Regional Insights

North America accounted for a revenue share of more than 32% in 2023. North America is home to developed economies, such as the U.S. and Canada. The growth in the market is majorly driven by of existence of long-established original equipment manufacturers, providing a firm foundation for the region's robust development and expansion of the market.Rising infrastructure investment, innovation in terms of drive technologies, and the ongoing expansion from local to global supply chain networks are anticipated to drive the demand for commercial vehicles in North America.

Asia-Pacific is expected to grow at a CAGR of 3.3% over the forecast period. The evolving automotive industry in emerging economies such as China and India will drive market growth. The Make In India campaign is expected to draw substantial investment in the automotive sector, as there are several benefits in India, such as cheaper raw materials and low-cost labor. Furthermore, countries such as China and India have large logistics networks & supply chains and are among the fastest-growing economies globally. All these factors will boost the demand for an automotive engine.

Some of the prominent players in the automotive engine market include:

• AB Volvo
• Cummins Inc.
• Fiat Automobiles S.p.A
• Volkswagen AG
• Ford Motor Company
• Mitsubishi Heavy Industries, Ltd.
• General Motors
• Honda Motor Co., Ltd.
• Mercedes-Benz
• Renault Group

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2021 to 2033. For this study, Nova one advisor, Inc. has segmented the global automotive engine market.

Placement Type

• In-line Engine
• V-type Engine
• W Engine

Fuel Type

• Gasoline
• Diesel
• Other Fuel

Vehicle Type

• Passengers Car
• Commercial Vehicle

By Region

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East & Africa (MEA)