Market Trends of Automotive Wheel Industry
Alloy Wheels Hold a Major Market Share
The word alloy is a scientific term that denotes two or more combined metals that have properties different from those of the original elements. Alloy wheels are generally a mixture of aluminum and magnesium, used to create a strong and lightweight wheel rim with improved strength and resistance to corrosion compared to traditional steel wheels. Alloy wheels can also be molded into aerodynamic shapes, making them popular for performance-oriented operators or drivers.
Moreover, alloy wheels are manufactured as single-piece rims and discs and are produced using a forged process. Magnesium and aluminum alloys are commonly used in most off-highway wheels to reduce their weight.
Magnesium alloys exhibit good fatigue properties and resilience, so they can resist vibrational and shock loading better than other alloy types. Magnesium alloys produce a weight savings of 30% over aluminum alloys and 50% over steel for similar strength.
Several key players are expanding their manufacturing facilities across the major regional markets and investing in research and development facilities, which in turn is likely to drive significant growth for the market during the forecast period. For instance,
- In February 2023, RUSAL started using end-of-life aluminum scrap in the production of foundry alloys for the automotive industry. This production enabled RUSAL to achieve a nearly 20% reduction in the full-scope carbon footprint of the resulting new product.
Alloy wheels often have a more appealing and stylish appearance compared to traditional steel wheels. While aesthetics may not be the primary concern in off-highway equipment, a well-designed alloy wheel can still contribute to the overall visual appeal of the machinery. Due to their lighter weight, alloy wheels can contribute to improved fuel efficiency by reducing the overall weight of the equipment.
Factors such as growing vehicle production and major countries globally opting for several government initiatives, coupled with the manufacturing of vehicles across the major regions, are promoting e-mobility. However, the impact of the COVID-19 pandemic has resulted in slow growth. The demand for premium and luxury vehicles is increasing in developing economies like China and India because of the increased spending power of people living in these regions.
The abovementioned developments worldwide are likely to increase the demand for alloy wheels during the forecast period.
Asia-Pacific Remains the Market Leader
Asia-Pacific is expected to dominate the automotive wheels market during the forecast period. This growth is mainly attributed to China and India. With almost 60% of the world's vehicles in the region during the forecast period, the demand for automobiles across Asia-Pacific will be the highest globally, owing to the region's highest population percentage and two densely populated nations, China and India.
The income level of the people in this region is also growing at a very rapid pace. The region accounts for a large share of mid-income people concerned with vehicle fuel economy. With the reduction in the overall weight of the vehicle, fuel economy is expected to grow. With the demand for automobiles, the wheels market is also expected to grow during the forecast period.
China, being the largest automotive market globally, is also expected to play a crucial role in pushing the market forward, primarily due to the country鈥檚 workforce and manufacturing capabilities and manufacturing-friendly governmental laws.
The automotive wheel market in India is growing steadily, and the growth is expected to accelerate in the coming years. In India, the growth rate of alloy wheels is higher than the average growth rate of the automotive wheels market. Passenger cars have been growing at a rate of approximately 9% per annum.
India is one of the leading automotive component manufacturing countries. The rise in vehicle sales and increase in investments across the country is likely to create a lucrative opportunity for the market over the coming years.
Consumers in India are increasingly preferring to avail luxury vehicles attributed to the rising purchasing power, which, in turn, is positively impacting the demand for this segment of the market, as major luxury vehicle manufacturers are employing alloy wheels in their models to enhance customer convenience.
- Luxury car sales in India crossed 30,000 units in the first nine months of 2023 (January to September 2023), with leading luxury vehicle manufacturers such as Mercedes-Benz and Audi recording double-digit growth. Mercedes-Benz sold more than 12,768 units during the same period, followed by BMW (9,850 units) and Audi India (5,330 units).
- On the other hand, Jaguar Land Rover witnessed a surging growth of 108% in the second quarter of 2023 compared to the same period in 2022.
Owing to the abovementioned developments, the Asia-Pacific automotive wheels market is likely to witness major growth during the forecast period.
