Advanced High Strength Steel (AHSS) Market Analysis, By Type (Dual Phase, Martensitic), By Vehicle Type (Passenger, Commercial), By Tensile Strength (Up to 600 MPa, 600-900 MPa, 1200-1500 MPa, Above 1500 MPa), By Application (Structural Details, Car Seats) - Global Insights 2022 to 2032.

Advanced High Strength Steel (AHSS) Market Outlook

The global advanced high strength steel (AHSS) market is set to reach a valuation of US$ 20.3 billion in 2022 and expand rapidly at a CAGR of 7.9% to end up at US$ 44.2 billion by 2032.

Sales of advanced high strength steel (AHSS) accounted for nearly 2% share of the global steel market at the end of 2021. AHSS is used in oil rigs, bridges, civil engineering, and construction machines owing to its light weight, strength, durability, recyclability versatility, and high corrosion resistance.

Analysis of Mushrooming Demand for AHSS

The use of lightweight advanced high strength steel is associated with significant environmental effects in general, and with active structures in particular, and has application in rail coach building and related fields.

AHSS is used in solar heating systems for warehouses & buildings and also finds application in the building of solar panel roofing systems. Growing focus on manufacturing parts with improved performance, strength, and durability is expected to have a positive impact on market growth over the decade.

Requirements for weight reduction in automobiles will continue to rise with progressing technologies for safety, comfortable driving, and environmental measures. Advanced high-strength steels are increasingly being utilized in automotive parts such as crash boxes, front-end structures, automotive pillars, automotive rails, sill reinforcement doors, etc.

• Short Term (2022-2025): Increasing deployment and incorporation of AHSS in the automobile, aviation, and marine industries to positively impact market growth.
• Medium Term (2025-2028): Key developments in emerging countries are anticipated to increase the demand for AHSS on the back of growing infrastructure and high adoption of EVs.
• Long Term (2028-2032): Development of third-generation steel with improved steel strength and elongation properties will increase its utilization in several industries.

Over the 2017-2021 period, the global advanced high strength steel market registered a CAGR of 7%, and according to this latest study by Fact.MR, a market research and competitive intelligence provider, demand is projected to exhibit growth at 7.9% CAGR between 2022 and 2032.

Market share analysis of AHSS based on application and region. Under the application segment, the passenger vehicle sub-segment currently dominates with 83.9% market share.

How is the AHSS Market Expected to Evolve?

“Incessant Growth of Automotive Industry”

The automobile industry has become one of the most highly regarded economic sectors as a result of the rapid changes in the global economy, followed by growth in emerging countries. Sales of new vehicles have increased as a result of the strengthening global economy. Numerous opportunities are being created by the steadily expanding automobile industry for advanced high strength steel.

The usage of composites and AHSS in the production of automotive parts has increased due to the need for lighter commercial vehicles. Numerous OEMs in the automotive industry are likely to follow this trend as composite-made auto parts help reduce the overall weight of automobiles.

This is linked to the rise in high-performance demand, which can be met by lightening the overall weight of automobiles. Rising safety concerns from automotive consumers have also driven product demand from automakers. Also, the fuel economy standards set by government authorities are lifting the demand for AHSS by automakers.

“Advancement in Steel Properties through R&D”

Spending on R&D is growing as automakers are now facing competition from Silicon Valley. Traditionally, OEMs consolidated their position by working on the hardware aspect, but as technology drives the vehicles of tomorrow, the industry has been forced to dive into a domain in which it has limited expertise. Collaboration with tech companies remains a feasible option in the long term.

Emphasis on R&D will likely rise in the near future as automakers look to match the pace of changing environmental norms and lightweight materials. Advanced lightweight materials are expected to become a key component of brand marketing.

Automakers are now speeding up and scaling up their R&D activities due to the rate at which new technologies are changing the automotive industry. Rising focus on products with improved performance, strength, and durability is expected to have a positive impact on the market over the coming years.

“High Cost and Presence of Alternatives: A Major Threat”

With shifting consumer demands, the design of automobile vehicles has consistently changed. However, making significant efforts to improve equipment design results in more spending, which raises the cost of the equipment. The challenge for manufacturers is to reduce the cost of their products while increasing productivity and efficiency.

Consumers place a high priority on car costs, and the use of cutting-edge high-strength steel raises the total cost of the vehicle. As a result, the high price of advanced high strength steel relative to traditional steel could impede the market's overall growth.

AHSS is relatively expensive and growing standards from consumers with time have made the market dynamic. Aluminum appears to be the top contender among the low-weight, great-strength elements that automotive makers are continuously looking for. Aluminum has drawn a lot of attention from manufacturers due to its high efficiency, functionality, formability, and performance.

Country-wise Insights

Will the Prominent Automotive Sector in Germany Drive High Demand for AHSS?

Europe is dominated by Germany, which accounts for around one-third of regional AHSS demand. Germany is the largest manufacturer and exporter of automobiles in the EU. German OEMs invested US$ 28.3 billion in research and development, accounting for one-third of global automotive R&D investments in 2021.

The growing automobile industry has surged the demand for side impact beams, chassis, and structural details used to provide cars with impact resistance and improved safety. Regional regulations on emission standards are also boosting their implementation.

Continuous development on improving tensile strength is being made, coupled with the improvement of processing and forming technology. Manufacturers are stressing the cost of AHSS for use in mass-produced vehicles.

Owing to the presence of major manufacturers in the automotive sector, Germany is anticipated to hold significant potential for AHSS sales over the coming years.

Why is China Seeing High Sales of AHSS?

China is still the world’s largest automotive market by manufacturing output as well as annual sales.

• According to the International Trade Administration, domestic production is anticipated to reach 35 million units by 2025.

Sales of AHSS will increase in China owing to growing automotive production coupled with green field investments across the country. AHSS demand has risen from prominent automakers who are striving to achieve improved safety and fuel economy in vehicles.

China holds an unassailable position in East Asia, accounting for roughly 68.3% of the total market. The China market for AHSS is predicted to reach US$ 2.8 billion in 2022.

Category-wise Insights

Why is Dual Phase AHSS Most Widely Utilized?

Dual-phase steels are the perfect choice for structural parts and reinforcements, as well as other automotive tasks, due to their low initial yielding stress, high tensile strength, strong early-stage strain hardening, and uniform plastic flow. The completed parts benefit from the great mechanical strength, exceptional fatigue resistance, and strong energy absorption capacity of dual-phase steel.

The Dual-phase (DP) advanced high strength steel segment represents a significant revenue share in the global market and is expected to grow at a CAGR of 7.1% over the forecasted period.

How is the Passenger Vehicle Segment Expected to Account for Substantial Market Growth?

AHSS is the preferred material for passenger safety cage parts such as bumpers, waistline reinforcements, side impact beams, A-pillars, B-pillars, and roof bows. In all other essential sections of the automobile industry, advanced high-strength steel has also been introduced.

• Germany comprises around 25% of all passenger vehicles produced globally. Around 2.1 million units of passenger vehicles were produced by German manufacturers in 2021.

Electric car production is increasing as a result of environmental concerns, creating a wealth of prospects for makers of high-tech steel. AHSS can play a significant part in meeting the criteria of the design when it comes to the necessity to reduce the weight of electric automobiles

Increasing passenger vehicles, surging adoption of electric vehicles, and usage of AHSS in their manufacturing will provide upward progress in the market.

Competitive Landscape

Prominent advanced high strength steel manufacturers are AK Steel Holding Corp, ArcelorMittal SA., Baker Hughes Company, Baoshan Iron & Steel Co., Ltd, Big River Steel, Nucor Corp, POSCO, SSAB AB, Steel Technologies LLC, Tata Steel Ltd, ThyssenKrupp AG, and United States Steel Corporation.

Market players are focusing on product innovation, with '3rd Generation' being the buzzword. Forward integration with leading automotive players remains a key differentiating strategy.

An inorganic strategy such as acquiring an AHSS firm that is preferable over the expansion of the firm is majorly followed by market players. Collaborations among key market players and automotive players remain a major point.

• In July 2022, ArcelorMittal acquired 80% of voestalpine's HBI plant in Texas to increase its capacity and produce high-quality input resources that are required for low-carbon emissions steel making.
• In January 2022 SSAB announced its plan to invest US$ 4.1 billion in a new Nordic production system to broaden the offering of its premium products, AHSS, and Q&T.

Fact.MR has provided detailed information about the price points of key manufacturers of AHSS positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.

Segmentation of AHSS Industry Research

• By Type :

  • Dual Phase (DP)
  • Martensitic (MS)
  • Transformation-induced Plasticity (TRIP)
  • Twinning-induced Plasticity (TWIP)
  • Others

• By Vehicle Type :

  • Passenger
  • Commercial

• By Tensile Strength :

  • Up to 600 MPa
  • 600-900 MPa
  • 900-1200 MPa
  • 1200-1500 MPa
  • Above 1500 MPa

• By Application :

  • Structural Details
  • Car Seats
  • Bumpers
  • Chassis, Wheels & Power Train
  • Side Impact Beams
  • Others

• By Region :

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • MEA