Auto Parts Manufacturing Market

Auto Parts Manufacturing Market Outlook (2024 to 2034)

A recent analysis by Fact.MR reveals that the global auto parts manufacturing market size is poised to reach US$ 454.7 billion in 2024 and is projected to expand at a CAGR of 3.9% to end up at US$ 666.6 billion by 2034.

The industry has seen a significant shift toward electric vehicle (EV) development, with many leading manufacturers ramping up production of existing EV models. Focus on EV production is primarily motivated by EPA regulations, which require that two-thirds of new vehicles produced be electric by 2030. This push towards EVs reflects a growing awareness and commitment among manufacturers to meet environmental standards and embrace sustainable transportation options.

As automakers increasingly prioritize EV production, the demand for components specific to electric vehicles is growing. This includes batteries, electric motors, power electronics, and other specialized parts unique to EVs. Consequently, auto parts manufacturers have been compelled to adapt their production lines and invest in research and development to meet this growing demand.

Automation in production as well as IoT deployment are reshaping the auto parts manufacturing landscape. Advancements in technology help manufacturers speed up and improve the manufacturing process, reduce risk, and monitor equipment, thus driving auto parts manufacturing market growth.

Report Attributes	Details
Auto Parts Manufacturing Market Size (2019A)	US$ 375.5 Billion
Estimated Market Value (2024E)	US$ 454.7 Billion
Forecasted Market Value (2034F)	US$ 666.6 Billion
Global Market Growth Rate (2024 to 2034)	3.9% CAGR
China Market Size (2023A)	US$ 101.8 Billion
United States Market Growth Rate (2023 to 2033)	4.2% CAGR
Key Companies Profiled	Robert Bosch GmbH Denso Corporation Valeo SA Continental AG Aptiv PLC ZF Friedrichshafen AG Magna International Inc. Faurecia S.A. Aisin Seiki Co. Ltd. Brembo S.p.A ACDelco Akebono Brake Industry Co. Ltd. Others

What are the Key Auto Parts Manufacturing Market Trends?

“Focus on Customization Leveraging Technological Advancements”

Increasing production and sales of automobiles are projected to boost the demand for auto components. Automakers rely on a diverse range of suppliers to meet this demand, creating opportunities for manufacturers of various auto parts. This demand extends across the entire spectrum of vehicles, from passenger cars to commercial trucks and specialty vehicles, further diversifying the market.

Customization of auto parts according to a customer's demand requires the usage of advanced automotive technology. Generally, governments invest in R&D or provide subsidies to manufacturers to drive them toward environment-friendly production.

• According to the European Commission, US$ 171 million worth of cars was exported from the European Union in 2022.
• According to the Federal Reserve Bank of the United States, sales of automotive vehicles in January 2024 touched 15 million, which is more than twice the sales volume recorded in 2020. This significant rise in the sales of automobiles is driving the expansion of the auto parts manufacturing market size.

“Government Support for Auto Parts Manufacturers Through Incentives for R&D and Subsidies”

Governments play a vital role in supporting auto parts manufacturers through a variety of initiatives. This assistance includes providing incentives for research and development and fostering automotive innovation in product design and manufacturing processes.

Trade policies are implemented to protect domestic manufacturers, ensuring fair competition in the global market. Infrastructure investments are made to enhance logistics and supply chain efficiency, facilitating the production and distribution of auto parts.

• The government of the United Kingdom is investing in automated mobile research and development programs. The main objective of the funding is to strengthen the supply chain and the development of zero-emission vehicles.
• A program worth US$ 1.65 billion was recently launched by the German government to support the auto industry in the country. This initiative aims to cushion the effects of the COVID-19 pandemic, by making investments in autonomous driving, sustainable production, and the development of data-driven business models.

Demand for auto parts is also increasing in developing countries such as India.

• According to the Indian Brand Equity Foundation, India is the third-largest automobile market and the largest market for manufacturing three-wheelers. Initiatives such as PIL schemes and the Automotive Mission Plan 2016 to 2026 have been taken by the Government of India for the development of the automotive sector.

What are the Challenges Faced by Auto Parts Manufacturing Companies?

“Rising Production Costs Due to Adoption of Eco-Friendly Practices"

The automobile industry faced liquidity constraints due to factory shutdowns and declining sales during the COVID-19 pandemic. Growing emphasis on sustainability has prompted auto manufacturers to follow eco-friendly practices and green technologies, which drives up production costs for auto parts.

Stiff competition among automakers reduced the prices of vehicles. This is prompting manufacturers to enhance efficiency and adapt to evolving market demands to sustain their profits, which is also boosting production costs.

Country-wise Insights

Why is China a Lucrative Market for Auto Parts Manufacturers?

“Favorable Regulatory Policies for Automotive Manufacturing”

China is estimated to hold 59.4% of the auto parts manufacturing market share in East Asia in 2024. The market in China is projected to expand at a CAGR of 3.5% from 2024 to 2034. The relaxation of regulatory policies is encouraging manufacturers to invest more in the country’s automobile industry.

China boasts the world’s largest automotive market, with millions of vehicles produced and sold annually. The country offers skilled cost-effective labor, which attracts manufacturers from around the world.

• According to the International Trade Administration estimates, vehicle production in the country is forecasted to reach 35 million by 2025.

What are the Factors Driving Auto Parts Manufacturing in the United States?

“Government Offering Tax Credits to Consumers Purchasing Electric Vehicles”

The United States is estimated to hold a market share of 68.3% in North America in 2024. Sales of auto parts in the country are projected to increase at a CAGR of 4.2% from 2024 to 2034.

The United States government provides funding for research and development (R&D) initiatives in the automobile sector to support innovation and technological advancements. This funding may come in the form of grants, loans, or tax incentives to encourage investment in R&D activities related to vehicle safety, fuel efficiency, and alternative propulsion technologies.

The government offers tax credits to consumers who purchase electric vehicles (EVs) to incentivize their adoption.

• The United States Department of Energy reported that the federal government provided a tax credit of up to US$ 7,500 for the purchase of eligible plug-in electric drive motor vehicles in 2022. This incentive aims to promote the adoption of EVs and foster the expansion of the electric vehicle market.

Category-wise Insights

Which Vehicle Category Accounts for High Market Growth?

"Passenger Vehicle Category to Account for High Revenue Streams"

The passenger vehicles segment is set to reach a value of US$ 289 billion in 2024 in the aftermarket parts business and is projected to reach US$ 458 billion by the end of 2034, expanding at a 4.7% CAGR.

Investments in transportation infrastructure, including roads, highways, and charging stations for electric vehicles, can improve accessibility and convenience for passenger vehicle owners. Enhanced infrastructure encourages more people to own and use personal vehicles.

Government incentives, such as tax credits for electric vehicle purchases, subsidies for vehicle scrappage programs, and incentives for fuel-efficient vehicles, are projected to stimulate demand for passenger vehicles. These incentives aim to promote environmental sustainability, reduce emissions, and support the automotive industry.

Competition Analysis

Key players in the auto parts manufacturing market include Denso Corporation, Valeo SA, Continental AG, Aptiv PLC, ZF Friedrichshafen AG, Magna International Inc., Faurecia S.A., Magneti Marelli SpA, and Robert Bosch GmbH.

• In February 2024, Pacific Rim Auto Parts, which is an automotive recycler company, was acquired by Fenix Parts. The main objective of the acquisition is to leverage the Pacific's specialty of e-commerce part listing and sales. The main focus would be on electric vehicles and hybrid vehicles recycling utilizing e-commerce sales channels.
• In December 2023, Valeo and Stellantis collaborated to launch the first windshield-mounted automotive video camera remanufactured at Valeo Circular Electronics Lab. Valeo has more than 40 years of experience, and it has remanufactured 1 million products so far. This step has been taken to achieve the net carbon zero goal by 2038.
• In January 2022, Bosch and Cariad, which is a subsidiary of Volkswagen Group, agreed on an extensive partnership. This engineering alliance is projected to spur automated functions across all the vehicle classes.
• In 2022, Aptiv, an auto parts manufacturer, acquired Intercable Automotive Solutions to bolster design capabilities to decrease vehicle weight, mass, and overall costs.

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

Segmentation of Auto Parts Manufacturing Market Research

• By Component :

  • Batteries
  • Cooling Systems
    • Compressors
    • Radiators
    • Pumps
    • Thermostats
  • Underbody Components
    • Brake Components
    • Exhaust Components
  • Automotive Filters
  • Engine Components
    • Starters
    • Pumps
    • Engines
    • Alternators
  • Lighting Components
  • Electrical Components
    • Ignition Coils
    • Ignition Switches
    • Spark & Glow Plugs
    • Others

• By Vehicle Category :

  • Passenger Vehicles
  • Commercial Vehicles
    • LCVs
    • HCVs
    • Buses & Coaches
    • Off-Road/ Highway Vehicles

• By Sales Channel :

  • OEMs
  • Aftermarket
    • Online Sales
      • Company-owned Platforms
      • e-Commerce Platforms
    • Offline Sales
      • Authorized Dealers
      • Independent Stores

• By Region :

  • North America
  • Latin America
  • Western Europe
  • Eastern Europe
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa