Passenger Car Transmission Market – Global Industry Size, Share, Trends Opportunity, and Forecast 2019-2029. Segmented By Vehicle Type (Sedan, Hatchback, SUVs & MPVs and others), By Fuel Type (Diesel, Petrol and Others), By Transmission Type (Manual, Automatic) By Region and By Competition 2019-2029F
Published Date: March - 2025 | Publisher: MIR | No of Pages: 320 | Industry: Automotive | Format: Report available in PDF / Excel Format
View Details Buy Now 2890 Download Sample Ask for Discount Request Customization| Forecast Period | 2025-2029 |
| Market Size (2023) | USD 94.66 billion |
| CAGR (2024-2029) | 7.55% |
| Fastest Growing Segment | Automatic Transmission |
| Largest Market | Asia-Pacific |
| Market Size (2029) | USD 145.85 billion |
Market Overview
The size of the Global Passenger Car Transmission Market was USD 94.66 Billion in 2023 and is expected to reach USD 145.85 Billion by the end of 2029, with a growth rate of 7.55% over the forecast period 2024-2029.
The development of electric vehicles (EVs) has introduced a new era to the Passenger Car Transmission Market. EVs mostly employ single-speed automatic transmissions or direct drive, which does not require conventional multi-speed transmissions. With increasing adoption of EVs, this segment can see further changes, which can affect the market dynamics of conventional automatic transmissions.
The incorporation of advanced driver-assistance systems (ADAS) and autonomous driving technologies has impacted transmission development. These systems need advanced transmission solutions that can communicate perfectly with sensors and computer systems in order to maximize vehicle control and safety. The Global Passenger Car Transmission Market is dominated by a shift towards automatic transmissions due to consumer preferences and the demand to keep up with stringent regulatory requirements. Technological advancements in transmission technology, electric vehicle adaptations, and integration with automated driving technologies all go towards the dynamic and ever-changing nature of the industry. The industry still evolves to meet the changing demands of consumers and regulatory requirements, molding the future of passenger car transmissions.
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Key Market Drivers
Consumer Preference for Automatic Transmissions
One of the primary drivers is the evolving preference of consumers for automatic transmissions. The demand for convenience, particularly in urban areas, has fueled the shift from manual to automatic transmissions, leading to increased market share for the latter. For Instance, in October 2024,
Stringent Emission Regulations
Global efforts to reduce carbon emissions and enhance fuel efficiency have prompted automakers to develop advanced transmission technologies. Regulations push for transmissions that optimize engine performance, reduce fuel consumption, and minimize emissions, driving innovation in this market.
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Urbanization and Congestion
Rapid urbanization worldwide has led to increased traffic congestion, making automatic transmissions more appealing. The ease of driving and reduced fatigue associated with automatic transmissions align with the needs of city dwellers, further boosting their adoption.
Electric Vehicle Growth
The rise of electric vehicles (EVs) has launched specialized transmission needs. While traditional automatic transmissions may not be required in many EVs, the growth of this segment presents opportunities for innovative transmission technologies that suit EV powertrains. In 2023, nearly 14 million new electric cars were registered worldwide, raising the total number of electric vehicles on the roads to 40 million. The number of electric car sales in 2023 was 3.5 million higher than in 2022, marking a 35% increase from the previous year. This figure is over six times greater than the total recorded in 2018.
Technological Advancements
Continuous advancements in transmission technology, such as multi-speed transmissions, continuously variable transmissions (CVTs), and dual-clutch transmissions, enhance fuel efficiency and overall vehicle performance. These innovations drive market growth as automakers strive to meet consumer demands.
Demand for SUVs and Crossovers
The global surge in demand for SUVs and crossovers has a significant impact on the transmission market. These larger vehicles often require different transmission systems to optimize power delivery and fuel efficiency, contributing to market expansion.
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Integration with Advanced Driver-Assistance Systems (ADAS)
The integration of transmission systems with ADAS and autonomous driving technologies has become a crucial driver. Sophisticated transmissions are essential to work seamlessly with these systems, enhancing safety and driving experience.
Global Expansion of Automotive Markets
The growth of emerging automotive markets in regions like Asia-Pacific and Latin America has increased demand for passenger cars with automatic transmissions. These markets are experiencing rising incomes and urbanization, driving the need for convenient and efficient vehicles.
The Global Passenger Car Transmission Market is shaped by a complex interplay of factors. Consumer preferences, regulatory pressures, technological advancements, and the evolving automotive landscape all contribute to its dynamics. As the industry continues to innovate and adapt to changing demands, these drivers will remain pivotal in influencing its growth trajectory.
Key Market Challenges
Evolving Consumer Preferences
One of the ongoing challenges is the diversity of consumer preferences. While automatic transmissions are gaining popularity due to their convenience, some consumers still prefer manual transmissions for their cost-effectiveness, control, and driving engagement. Striking the right balance between automatic and manual transmission offerings is a challenge for automakers, as they need to cater to a wide range of consumer preferences.
Stringent Emissions Standards
Globally, governments are imposing increasingly stringent emissions standards to combat environmental issues. Meeting these standards while still providing efficient and affordable transmissions is a significant challenge for automakers and transmission manufacturers. The need to reduce emissions often requires investments in advanced transmission technologies, which can increase production costs.
Electric Vehicle Disruption
The rise of electric vehicles (EVs) presents a disruptive challenge to traditional transmission manufacturers. Many EVs use single-speed transmissions or direct-drive systems, which eliminate the need for multi-speed transmissions. This shift has the potential to reduce the demand for traditional automatic transmissions, impacting market dynamics.
Transition to Hybrid Powertrains
Hybrid vehicles incorporate a combination of internal combustion engines and electric powertrains, often requiring specialized transmissions to optimize power delivery. This shift towards hybridization poses a challenge for transmission manufacturers, who must develop and supply hybrid-specific transmission systems to meet automakers' needs.
Technological Advancements
While technological advancements drive innovation in transmission systems, they also create challenges. The complexity of modern transmissions, such as dual-clutch transmissions and continuously variable transmissions (CVTs), can lead to higher maintenance costs and repair challenges for consumers, impacting long-term reliability.
Cost Pressures
Automakers face constant cost pressures to remain competitive in the market. Developing and integrating advanced transmission technologies while keeping vehicles affordable can be a challenging balancing act. High research and development costs for transmission innovation can strain profit margins.
Global Economic Factors
Economic fluctuations, trade disputes, and supply chain disruptions can impact the availability and cost of transmission components and materials. These factors can lead to production delays and increased expenses, affecting the overall profitability of automakers.
Regulatory Uncertainty
Automotive regulations and standards vary by region and can change over time. This regulatory uncertainty can create challenges for automakers and transmission manufacturers in terms of compliance, leading to potential delays and additional costs in adapting to new regulations.
The Global Passenger Car Transmission Market faces a complex set of challenges, including evolving consumer preferences, emissions standards, the rise of electric and hybrid vehicles, technological complexity, cost pressures, economic factors, and regulatory uncertainty. Navigating these challenges requires a combination of innovation, adaptability, and strategic planning within the automotive industry.
Key Market Trends
Shift Towards Automatic Transmissions
There is a clear trend favoring automatic transmissions over manual ones. This shift is driven by the growing demand for convenience and ease of driving, particularly in congested urban areas. Automatic transmissions provide a smoother and more effortless driving experience, leading to a significant increase in their adoption globally.
Hybridization and Electrification
The automotive industry is witnessing a surge in hybrid and electric vehicles (EVs), both of which have distinct transmission requirements. Hybrid powertrains often incorporate specialized transmissions to efficiently combine internal combustion engines with electric motors. EVs, on the other hand, frequently employ single-speed transmissions or direct-drive systems, eliminating the need for traditional multi-speed transmissions.
Advanced Transmission Technologies
Continuous advancements in transmission technology are driving innovation. Multi-speed transmissions, continuously variable transmissions (CVTs), and dual-clutch transmissions are examples of sophisticated technologies designed to enhance fuel efficiency, performance, and overall driving experience. These innovations are aimed at meeting stricter emissions regulations and improving fuel economy.
Efficiency and Emissions Reduction
Global emissions standards are becoming increasingly stringent, motivating automakers to invest in transmission technologies that improve fuel efficiency and reduce emissions. Transmissions play a pivotal role in optimizing engine performance and fuel consumption, making them a crucial component in achieving compliance with these regulations.
Integration with Hybrid Systems
Hybrid vehicles, which combine internal combustion engines with electric propulsion, require advanced transmission systems to manage power transitions effectively. Transmissions in hybrids are designed to seamlessly shift between different power sources, maximizing efficiency and performance.
Continued Growth of SUV Segment
The popularity of SUVs and crossovers continues to rise, impacting the transmission market. These larger vehicles often require different transmission systems to optimize power delivery and fuel efficiency. Automakers are adapting by developing transmissions tailored to the needs of SUVs.
Transmission Electrification
Transmission electrification involves the integration of electric motors into transmission systems, enhancing overall vehicle efficiency and performance. This trend is particularly relevant in hybrid and plug-in hybrid vehicles, where electric motors work in conjunction with traditional transmissions to optimize power delivery.
Enhanced Connectivity and Automation
The integration of transmissions with advanced driver-assistance systems (ADAS) and autonomous driving technologies is on the rise. These systems rely on sophisticated transmissions that can seamlessly communicate with sensors and control systems, contributing to improved vehicle safety and automation capabilities.
The Global Passenger Car Transmission Market is witnessing a transformation driven by consumer preferences, environmental regulations, technological advancements, and the evolving landscape of vehicle electrification. These trends collectively shape the market's future as automakers and transmission manufacturers adapt to meet the changing needs of the industry and consumers.
Segmental Insights
Transmission Type Insights
Transmission Type is a central factor in the structure of the market. Automatic Transmissions have seen a major surge, with the rising trend for convenience and smoother drives. These transmissions are gaining ground, particularly in crowded urban regions, where simplicity is greatly preferred. Continuously variable transmissions (CVTs) and multi-speed automatics are increasingly being favored due to their fuel efficiency advantages. Furthermore, dual-clutch transmissions provide a sportier driving feel, appealing to car enthusiasts. On the other hand, Manual Transmissions, although losing ground, continue to hold some ground, especially in areas where affordable alternatives are desired or where driving enthusiasts enjoy the direct feel they yield. Manual transmission vehicles generally get about 10 percent better mileage and provide better control in adverse driving conditions than their automatic counterparts. In addition, manual transmission cars tend to be cheaper, have smaller repair and maintenance costs, and achieve improved fuel efficiency within urban driving. Automatic transmissions, on the other hand, can offer improved fuel efficiency during highway driving, though this depends on the driver's driving behavior.
Regionally, the market has regional differences, and the Asia-Pacific region is a leader. This region has the highest production and consumption of vehicles, headed by economic giants China and India. The fast rate of urbanization and the expanding middle-class citizenry in the two countries have fueled the huge demand for passenger vehicles with automatic transmissions. The demand is further driven by a preference for SUVs and sedans in the region. North America also maintains a continued bias towards automatic transmissions. Customers in this region prefer the ease of use and convenience offered by automatic transmissions. The market is dominated by both local and global automakers with an emphasis on new transmission technologies to address tight emissions standards. Moreover, the popularity of electric and hybrid vehicles in North America has triggered the growth of dedicated automatic transmissions designed for these green cars.
Europe, however, is a varied market. Automatic transmissions are gaining traction, but manual transmissions maintain a strong presence, especially in nations with a rich automotive heritage. The region is keenly focused on emission reduction, and automakers are responding by making investments in sophisticated transmission technologies. High-end automatic transmissions are common in the luxury and premium vehicle segments of Europe, helping to drive the market. Beyond these large regions, other Latin American, Middle Eastern, and African markets have different levels of growth and adoption. Economic conditions, consumer tastes, and infrastructure development are key drivers of demand for automatic transmissions in these markets. Some markets are slowly moving towards automatic transmissions, while others are mainly using manual transmissions because of cost factors and local tastes.
The World Passenger Car Transmission Market is characterized by the active interaction between transmission types and geographic differences. Automatic transmissions' move towards dominating the market is conspicuous, promoted by customer aspirations for ease of use and performance, but at differing rates for each region that shows varying trends of preference and economic influences affecting the industry
Regional Insights
The Asia-Pacific region is a leading player in the Global Passenger Car Transmission Market. This is primarily due to its huge automotive production and consumption, spearheaded by economic giants like China and India. Urbanization, a growing middle-class population, and rising disposable income are fueling demand for passenger cars with automatic transmissions in the region. Demand for SUVs and sedans also drives market growth. Moreover, Asia-Pacific is now a center of automobile production and is thus an important player in the global transmission industry. North America has a consistent demand for automatic transmissions, as most people prefer the ease of use they provide, especially in areas where traffic is high. The industry is dominated by the presence of local and foreign automobile manufacturers. Automakers here concentrate on advanced transmission technologies to address strict emissions standards and enhance fuel economy. The popularity of electric and hybrid cars in North America has also encouraged the production of specialized automatic transmissions for these environmentally friendly vehicles.
Europe has a varied scene as far as transmission is concerned. Though automatics are gaining ground, manual transmissions retain a huge share of the market, especially in nations with an old automotive history. The market demands a strong focus on emissions reduction by automakers, encouraging them to invest in new transmission technologies. Premium and luxury segments of vehicles in Europe usually come with expensive automatic transmissions, which drive the market further. Europe's focus on sustainability and strict emissions rules continues to mold the transmission market in the continent.
The other regions, such as Latin America, the Middle East, and Africa, have mixed levels of growth and penetration in the Passenger Car Transmission Market. Economic conditions, consumer taste, and infrastructure growth have significant roles to play in determining demand. A few markets in these regions are slowly moving towards automatic transmissions because consumers prefer ease and efficiency. Yet, manual transmissions remain prevalent in a few places based on cost factors and traditional practices of driving.
The Worldwide Passenger Car Transmission Market reflects regional-specific characteristics driven by economic scenarios, consumer tastes, and regulatory factors. Although the trend for automatic transmissions is pan-global, the rate and level of adoption differ by geography, responding to the specific drivers that define each market environment.
Recent Developments
- In May 2024, Nissan introduced the Nissan Magnite Geza CVT Special Edition, starting at INR 9.84 lakh. Drawing inspiration from Japanese theatre and its expressive musical themes, this special edition is tailored for music enthusiasts, featuring enhanced infotainment systems and a premium speaker setup for an elevated sensory experience.
- In April 2024, Dana Incorporated unveiled its innovative electro-mechanical, infinitely variable transmission (EMIVT) system. This advanced system boasts a multi-mode driveline design that integrates a power-split transmission developed in-house with high-voltage motors. It also features smart lubrication and actuation, a low-voltage motor with an inverter for pump operation, and a driveline controller powered by proprietary software.
- In January 2024, Tata Motors introduced Automated Manual Transmission (AMT) for its Compressed Natural Gas (CNG) vehicles. The company has opened bookings for the Tiago and Tigor iCNG AMT models. With the integration of Twin Cylinder CNG technology to maximize boot space and the addition of automatic transmission, Tata Motors is establishing a new benchmark in the CNG vehicle segment.
Key Market Players
- Aisin Corporation
- Allison Transmission, Inc.
- BorgWarner Inc.
- Continental AG
- The Mercedes-Benz Group AG.
- PHINIA Inc.
- Eaton Corporation PLC
- Iveco Group ( FPT Industrial S.P.A)
- JATCO Ltd
- Magna International Inc.
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By Fuel Type |
By Transmission Type |
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