The Automotive Thermal Management Market size is estimated at USD 99.97 billion in 2024, and is expected to reach USD 132.96 billion by 2029, growing at a CAGR of 5.87% during the forecast period (2024-2029).
Manufacturing shutdowns, lockdowns, and trade restrictions during the COVID-19 pandemic negatively affected the automotive thermal management industry. Furthermore, the fall in automotive production and lack of labor significantly impacted the market. For instance, worldwide automobile production fell by 15.69% in 2019. Although in 2021, global automotive production increased significantly compared to the pandemic hit 2020, it was well below the figures of 2019, primarily attributed to the semiconductor shortage.
The rising need for better ride quality and heat insulation for cabin comfort is greatly emphasized in the automotive industry, leading to a much higher demand for thermal management systems. The ever-increasing number of electrical and electronic components inside vehicles also drives the need for better thermal management systems due to heat dissipation.
Over the long term, as the automotive industry moves to electric mobility, thermal management systems for IC engines are expected to go completely obsolete. However, the increasing number of heavy-duty electrical components, such as heavy-duty batteries and high-current motors, is expected to continue keeping the high demand in these aspects. With increasing automation and powertrain electrification, the demand for electrical and electronic components exponentially increased, in both passenger cars and commercial vehicles, in the automotive industry.
Major original equipment manufacturers are focusing on the development of thermal management systems to offer the best possible travel range for their electric fleet. For instance,
Auto parts suppliers are accelerating efforts to strengthen their global competitiveness in the thermal energy management market with the advancement of vehicle electrification. For instance,
Asia-Pacific is anticipated to be the largest market due to the presence of large OEMs for automotive thermal management systems, large markets for automobiles like China, India, Japan, and South Korea, and a well-developed automobile manufacturing industry.
North America and Europe are projected to be the next biggest markets due to high vehicle ownership rates, growing electric and autonomous vehicle sales, and extensive automobile manufacturing industries.
Thus, the confluence of the aforementioned factors is anticipated to drive the growth of automotive thermal management systems.
Vehicles that run on an all-electric powertrain or hybrid powertrain require a battery thermal management system. The battery is operated under a specific temperature for maximum charge storage and utilization efficiency. Hence, the increase in battery electric vehicles or plug-in hybrid vehicles is likely to drive the automotive thermal management market during the study period. For instance,
This spike in sales is the result of an increase in regulatory norms by various organizations and governments to control emission levels and propagate zero-emissions vehicles.
Companies are investing in making more efficient battery solutions for the upcoming battery electric vehicles. For instance,
Thus, the above factors are estimated to significantly expand the market for automotive thermal systems during the forecast period.
The growing automobile sector in Asia-Pacific (with India and China emerging as automotive part manufacturing hubs for the western automobile giants) is expected to drive the market for thermal management systems in this region.
The growing government regulations improving electric vehicle adoption and robust expansion adopted by OEMs and suppliers in the region to accommodate the rising demand from the automotive industry in China are expected to create a positive outlook for market growth during the forecast period. For instance,
The Indian automotive industry is the fourth-largest in the world, and in terms of commercial vehicle production, the country ranks seventh globally. The auto component business in the country has also increased significantly over the past five years. For instance,
In addition, rising sales of electric and hybrid vehicles in counties like China, India, Japan, and South Korea will further augment the market for automotive thermal systems in the Asia-Pacific region.
Thus, the Asia-Pacific region is predicted to remain the largest market for automotive thermal systems in the world during the forecast period.
The automotive thermal management market is moderately consolidated, with the major players dominating the market. Some of these players include Denso Corporation, Valeo, Mahle GmbH, Hanon System, and BorgWarner Inc. These payers engage in new product launches, joint ventures, and capacity expansions to expand their business activities and cement their market position. For instance,
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