Automotive Transmission Market Size, Share & Trends Analysis Report By Transmission Type (Manual, Automatic), By Fuel Type (Gasoline, Diesel), By Vehicle Type (Passenger Cars, HCVs), By Region- Global Industry Analysis, Share, Growth, Regional Outlook and Forecasts, 2024-2033

The global automotive transmission market size was exhibited at USD 152.35 billion in 2023 and is projected to hit around USD 260.24 billion by 2033, growing at a CAGR of 5.5% during the forecast period of 2024 to 2033.

Key Takeaways:

• Asia Pacific accounted for the largest revenue share of more than 33% in 2023
• The manual-type segment accounted for the largest revenue share of more than 50% in 2023.
• The gasoline segment accounted for the largest revenue share of more than 55% in 2023. 
• The passenger cars segment accounted for the largest revenue share of over 70% in 2023.

Automotive Transmission Market: Overview 

The automotive transmission market plays a pivotal role in the global automotive industry, serving as the critical link between an engine and the wheels. This overview aims to delve into the current landscape of the automotive transmission market, highlighting key trends, challenges, and opportunities shaping its trajectory.

Automotive Transmission Market Growth

The growth of the automotive transmission market is fueled by various factors. Firstly, the increasing demand for electric vehicles (EVs) is driving the development of efficient transmission systems tailored to electric powertrains. Technological advancements, such as dual-clutch transmissions and continuously variable transmissions (CVTs), are enhancing fuel efficiency and performance, contributing to market expansion. Additionally, the integration of connectivity and automation features in vehicles is influencing transmission design, with smart transmission systems gaining traction for their enhanced reliability and performance. Furthermore, the expansion of emerging markets, focus on lightweight materials, and collaborative partnerships among industry stakeholders present lucrative growth opportunities for automotive transmission manufacturers.

Automotive Transmission Market Report Scope

Automotive Transmission Market Dynamics

• Technological Advancements:

The automotive transmission market is characterized by continuous technological advancements aimed at improving performance, fuel efficiency, and overall driving experience. Innovations such as dual-clutch transmissions, continuously variable transmissions (CVTs), and automated manual transmissions (AMTs) have revolutionized transmission systems, offering smoother gear shifts, better fuel economy, and enhanced driving dynamics. Moreover, the integration of connectivity and automation features in vehicles is reshaping transmission design, with smart transmission systems incorporating predictive analytics and adaptive control algorithms gaining prominence. 

• Regulatory Pressures and Emission Standards:

Stringent emissions regulations worldwide are compelling automakers to develop transmission solutions that optimize fuel efficiency and reduce greenhouse gas emissions. Government mandates and environmental concerns are pushing for the adoption of cleaner and more efficient transmission technologies. As a result, automotive transmission manufacturers are investing in research and development to design transmission systems that meet or exceed regulatory requirements while maintaining cost-effectiveness. Additionally, the shift towards electric vehicles (EVs) is accelerating, prompting transmission suppliers to develop specialized transmission solutions tailored to electric powertrains.

Automotive Transmission Market Restraint

• Supply Chain Disruptions:

The automotive transmission market faces challenges stemming from supply chain disruptions caused by various factors such as geopolitical tensions, natural disasters, and global pandemics like the COVID-19 crisis. These disruptions disrupt the flow of critical components and materials required for manufacturing transmission systems, leading to production delays, increased costs, and supply shortages. The complexity of global supply chains makes them susceptible to disruptions, impacting the ability of automotive transmission manufacturers to meet demand and fulfill orders in a timely manner. 

• Shift in Consumer Preferences:

Changing consumer preferences and purchasing behaviors pose a significant restraint on the automotive transmission market. There has been a notable shift in consumer demand towards sport utility vehicles (SUVs), crossovers, and electric vehicles (EVs), which offer different transmission requirements compared to traditional passenger cars. This shift requires automotive transmission manufacturers to adapt their product offerings to cater to diverse vehicle segments and transmission technologies. Failure to anticipate and respond to changing consumer preferences can result in market share erosion and reduced profitability for transmission suppliers. 

Automotive Transmission Market Opportunity

• Expansion in Emerging Markets:

Emerging economies present lucrative opportunities for growth in the automotive transmission market. Rapid urbanization, rising disposable incomes, and increasing vehicle ownership rates in countries such as China, India, Brazil, and Mexico are driving demand for automobiles, including passenger cars and commercial vehicles. Moreover, infrastructure development initiatives and government incentives to promote automotive manufacturing further stimulate market growth in these regions. 

• Focus on Lightweight Materials:

The automotive industry's growing emphasis on fuel efficiency and emissions reduction is creating opportunities for innovation in lightweight transmission materials. Lightweight materials such as aluminum alloys, magnesium alloys, and advanced composites offer significant weight savings compared to traditional materials like cast iron and steel. By incorporating lightweight materials into transmission components such as casings, gears, and shafts, automotive transmission manufacturers can improve fuel efficiency, reduce vehicle emissions, and enhance overall performance. Furthermore, lightweight materials contribute to vehicle electrification efforts by optimizing the efficiency of electric powertrains and extending battery range.

Automotive Transmission Market Challenges

• Regulatory Compliance and Emission Standards:

One of the primary challenges confronting the automotive transmission market is the need to comply with stringent regulatory requirements and emission standards. Governments worldwide are imposing increasingly strict regulations aimed at reducing greenhouse gas emissions and improving fuel efficiency in vehicles. These regulations drive automakers and transmission manufacturers to invest heavily in research and development to develop transmission systems that meet or exceed these standards. However, achieving compliance while maintaining cost-effectiveness poses a significant challenge, particularly as regulations continue to evolve and become more stringent over time. 

• Rapid Technological Advancements:

The automotive industry is undergoing rapid technological advancements, particularly in areas such as electrification, connectivity, and autonomous driving. These advancements bring both opportunities and challenges for automotive transmission manufacturers. On one hand, technological innovations such as dual-clutch transmissions, continuously variable transmissions (CVTs), and automated manual transmissions (AMTs) offer improved performance, fuel efficiency, and driving dynamics. On the other hand, keeping pace with these advancements and incorporating new technologies into transmission systems requires significant investments in research, development, and manufacturing capabilities. 

Segments Insights:

Transmission Type Insights

The manual type segment accounted for the largest revenue share of more than 50% in 2023. This growth is attributed to the price difference in vehicles with manual and automatic transmission variants. Consumers are inclined to opt for manual transmission owing to price sensitivity. Moreover, manual type also provides better mileage compared to its automatic variant as the gear shifting can be manually adjusted to deduce fuel consumption.

The automatic type segment is projected to register the fastest CAGR from 2023 to 2033. The growth can be attributed to the advancements in the automotive industry and improvements in automatic transmissions. Moreover, automatic types are easier to operate, efficient, and more powerful and accurate. The high price of these products may hamper their adoption in countries, such as India and Mexico. However, changing preferences and increasing consumer purchasing power in these countries are expected to support the segment growth over the forecast period.

Fuel Type Insights

The gasoline segment accounted for the largest revenue share of more than 55% in 2023. Gasoline cars comply with almost all emission regulations. They are efficient and emit lesser gas as compared to their diesel counterparts. The rising demand for gasoline across countries, such as the U.S., China, and India, is anticipated to drive the segment growth over the forecast period. According to the International Energy Agency (IEA), the gasoline demand is anticipated to increase over the next few years, due to the fast-growing markets in Asia, Central & South America, Africa, and the Middle East, which accounts for about 70% of the global demand growth in 2023.

The diesel segment is estimated to register a steady CAGR from 2023 to 2033. Diesel cars also have a significant demand owing to their high compression ratio, which allows better engine efficiency. A diesel engine is simpler than a gas engine as it does not require any associated electrical system and spark plugs. This engine type is widely adopted for use in cars and SUVs as it offers improved performance, similar to that of a gas engine, but with added gas mileage and reliability.

Vehicle Type Insights

The passenger cars segment accounted for the largest revenue share of over 70% in 2023. Volatile fuel prices and the transportation infrastructure influence the demand for passenger cars. The global demand for passenger cars is expected to gain traction owing to the improving economic outlook in the U.S. and many developing markets, such as China and India.

Moreover, innovations in transmission technology in the passenger cars segment from 4-speed automatic transmissions to 8-speed and 9-speed automatic transmissions have led to enhancements in the overall comfort, driving experience, and fuel efficiency of these vehicles, which, in turn, augments the segment growth.

The HCVs segment is estimated to register the maximum CAGR of more than 8% from 2023 to 2033. Increasing manufacturing and infrastructure building activities have spurred the sales of HCVs. In addition, the growing number of HCVs in Europe has led the EU regulatory bodies and OEMs to enhance and improve the safety aspects of HCVs, thus driving their demand.

Regional Insights

Asia Pacific accounted for the largest revenue share of more than 33% in 2023 and is anticipated to continue its dominance, growing at the fastest CAGR during the forecast period. The market's growth is driven by the presence of several prominent automobile manufacturers and ancillaries in the region. Stringent regulations across Asia and the Pacific have encouraged companies to adopt efficient transmission systems. In addition, increasing automotive sales, especially in countries like China, India, Japan, and South Korea, are anticipated to have a positive impact on regional market growth over the forecast period.

The markets in North America and Europe are expected to witness significant growth with the increasing penetration of electrified transmissions, owing to the increasing focus on hybrid vehicles and their beneficial impact on fuel economy and emissions. In 2019, over 91% of passenger cars sold in the U.S. were internal combustion engine (ICE) vehicles, while electric vehicles (EVs) accounted for the remaining 9%.

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

• Aisin Seiki Co., Ltd.
• Allison Transmission, Inc.
• BorgWarner Inc.
• Continental AG
• Eaton Corporation PLC
• Getrag
• GKN PLC
• Jatco Ltd.
• Magna International, Inc.
• ZF Friedrichshafen AG

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 2023 to 2033. For this study, Nova one advisor, Inc. has segmented the global automotive transmission market.

Transmission Type

• Manual
• Automatic

Fuel Type

• Gasoline
• Diesel
• Others

Vehicle Type

• Passenger Cars
• LCVs
• HCVs

By Region

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