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Automotive Product Finder Magazine | Expanding horizons with new wheel technologies
Expanding horizons with new wheel technologies
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With rising need to reduce the weight of vehicles, the lightweight aluminum and magnesium alloy wheels segment is expected to show high growth rate (of approximately 20 per cent) in the near future. Some of the OEMs have started to offer advanced applications in their mid-segment vehicles, thus propelling the demand for advanced automotive wheels. In addition, high investment by major OEMs in advanced systems is expanding the horizons of wheel technologies.
The automobile industry has witnessed a continuous increase in the average weight of vehicles because of the rising demand for safety and comfort features. This has led to huge innovations and R&D efforts from both OEMs and wheel manufacturers in increasingly using lightweight materials to reduce the overall weight of the vehicle and comply with government regulations pertaining to vehicular fuel consumption and emissions.
The growing purchasing power of Indian consumers has triggered the demand for automobiles. Cost advantages for OEMs, low automobile penetration levels, and increased vehicle population in the country offer attractive market opportunities for automobile manufacturers and automotive component suppliers.
India: A booming vehicle market
The automotive industry in India is growing at a faster rate than most countries in the Asia Pacific region. For instance, the Indian government’s Automotive Mission Plan (AMP) predicts that the Indian automotive industry will grow 3.5-4 times from $ 71.27 billion in 2017 to $ 290.07 billion by 2025. Also, according to the Department of Industrial Policy and Promotion (DIPP), foreign direct investment (FDI) worth $ 17.40 billion has been made in India between April 2000 and June 2017. Therefore, India is anticipated to remain a promising market in the coming years.
India witnessed an increased demand for luxury and mid-priced vehicles in the past decade. However, the adoption rate of in-vehicle advanced technologies is insignificant and limited to premium vehicles only. Also, as the country’s automotive market is highly driven by cost, most of the advanced automotive electronics are only found in high-end vehicles. However, OEMs such as Suzuki and Hyundai have now started offering advanced applications in their mid-segment vehicles, which will also propel the demand for advanced automotive wheels in the mid-segment vehicles.
The Indian market for automotive wheels is estimated to grow from 26.5 million units in 2017 to 42.5 million units by 2025, at a CAGR of 6.10 per cent. The value of this market is estimated to be $ 1.53 billion in 2017 and is projected to reach $ 2.47 billion by 2025, at a CAGR of 6.20 per cent. Figure 1 indicates India’s automotive wheels market by volume.
The above 21” rim size of the Indian automotive wheel market is estimated to grow from $ 156.6 million in 2017 to $ 350.1 million by 2025, at the highest CAGR of 10.58 per cent. The 16”–18” segment is projected to grow from $ 470.6 million in 2017 to $ 737.7 million by 2025.
The Indian automotive wheels aftermarket is projected to reach 0.73 million units by 2025, at a CAGR of 3.68 per cent. The passenger car market is estimated to be the largest. It is projected to grow from an estimated $ 58.6 million in 2018 to $ 72.8 million by 2025, at a CAGR of 3.15 per cent. The alloy wheel market in India is growing at a steady pace with a rate of 15 per cent year-on-year. The alloy wheel share in India was close to 20 per cent in 2017. Increase in alloy wheel sales will boost the automotive wheels aftermarket during the forecast period.
Alloy leads the market
In terms of material type, automotive alloy wheel is the fastest growing segment in India, in terms of value, and will hold the largest market share by 2025. Figure 2 showcases different types of materials used for the manufacturing automotive wheels and their advantages.
Owing to the growing importance of weight reduction in vehicles, the lightweight aluminum and magnesium alloy wheels segment is expected to grow at a CAGR of approximately 20 per cent, in terms of value, during the forecast period.
An alloy is a mixture of multiple metals or metals with non-metals mixed in pre-determined proportions to achieve desirable properties such as corrosion resistance, durability, tensile strength, density, ductility, and malleability. The two major or commonly used components in the making of alloy wheels are aluminum and magnesium. Aluminum is a lightweight material and has ductility, durability, and corrosion-resistant properties. Cars manufactured using aluminum are lightweight, fuel efficient, and emission efficient.
Benefits such as high durability and tensile strength will boost the demand for alloy wheels in the Indian market. Steel wheels are heavier than alloy wheels, and that is why they will have a lower preference in the Indian wheels OE and aftermarket in coming years.
Apart from steel and alloy wheels, the Indian automotive industry also uses other advanced compositions such as carbon fiber and biodegradable products depending on vehicle type and application. The material selection depends on the area of application and its operational requirements. Carbon fiber is mostly used in high-end premium car wheels. The major advantages of carbon fiber wheels are greater performance potential, improved efficiency, enhanced comfort, and lower noise levels. Additionally, it improves the driving experience which is expected to boost the demand for carbon fiber materials in the Indian wheels market. However, its premium pricing has been one of the constraints hampering the overall growth of this market segment.
Investing in innovation
Wheel manufacturers have invested plenty in R&D for adopting advanced technologies for wheels both in OE and aftermarket. Through advanced technologies, manufacturers focus on wheel strength and its design capability that ensure stiffness and lightness. For instance, Enkei Corporation adopted two technologies such as Durville Die Casting and MAT Process. With these, Enkei now attempts for the largest possible weight reductions. Additionally, In February 2018, Maxion Wheels held a groundbreaking ceremony on the future site of its 25,000 m2 plant in Khed city, Pune, India.
The Indian automotive industry is moving toward lightweight materials, which, in turn, is leading to weight reduction and increase in fuel efficiency of vehicles. The Indian automotive industry is now following the government regulations regarding fuel efficiency and carbon emissions. Factors such as the availability of cheap labor and favorable government policies help undertake mass production of automotive components in India, which results in lower prices of automotive components. In addition, high investments by major OEMs in advanced technologies are providing growth opportunities for the automotive wheels manufacturers in India. Hence, the abovementioned factors would drive the auto wheels market in India.
Article courtesy: MarketsandMarkets, a market research and consulting firm specialising in high growth markets, disruptive technologies transforming businesses and newer applications. For details, contact Priyanka Tiwari of MnM on Mob: 097649 56350, or email: firstname.lastname@example.org
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