Automotive EGR Cooler Market: Current Analysis and Forecast (2022-2030)

Automotive EGR Cooler Market: Current Analysis and Forecast (2022-2030)

An EGR (Exhaust Gas Recirculation) is a part of the emission control system which recycles exhaust gas through the EGR cooler and sends it back into the engine’s cylinder to burn with the new fuel. The EGR cooler is basically a heat exchanger and one of the most key fundamental parts of an EGR system, containing antifreeze coolant which lowers the temperature of the exhaust before it cycles it back into the engine. An EGR system helps to curtail the NOx emission which is highly toxic, and also increases the efficiency of the engine by preventing the engine from burning over-rich fuel.

The Automotive EGR Cooler market is expected to grow at a steady CAGR of around 5% during the forecast period owing to the rising demand in the automobile sector. Moreover, the demand in emerging markets for automobiles is on the rise owing to reasons like rapid urbanization, rising earnings, and availability of easy financing, and in developed economies trends like premiumization and a shift towards SUVs is at play. Furthermore, with rising economic activities and rapid infrastructure development, the demand for commercial vehicles is also increasing. Additionally, increasing governments focus all across the globe to curb tailpipe emissions is another reason for the rising demand for EGR systems in automobiles which has helped to reduce the tailpipe emissions by curtailing NOx emissions and increasing engine efficiency. For instance, as per the United States Environmental Protection Agency (EPA), In the model year 2021, the average estimated real-world CO2 emission rate for all new vehicles fell by 2g/mi to 347 g/mi, the lowest ever measured, and Real-world fuel economy remained at a record high of 25.4 mpg.

• Based on type, the market is bifurcated into Shell & Tube coolers and Fin & Tube coolers. Among the two the fin & tube type EGR coolers hold a significant market share owing to the fact that fins inside the tube maximize the heat transfer effect from hotter exhaust gas thus increasing the efficiency of the EGR coolers. Furthermore, fin & tube-type EGR coolers take less space, are lightweight, and cost less than shell & tube-type EGR coolers making them an ideal choice for automobile applications.
• Based on application, the market is segmented into passenger vehicles, commercial vehicles, and off-highway vehicles. Among these, the passenger vehicle segment holds the significant market share owing to the fact that the demand for these vehicles across segments such as small and mid-sized vehicles, SUVs, and luxury passenger vehicles is on the rise with increased mobility as more number of younger population and women are joining the workforce, also after COVID-19 people are giving preferences to own personal mobility rather than using the public mode of transportations. Additionally, rising income and rapid urbanization in emerging economies are supporting the demand for the automobile industry. For instance, on June 2021, as per UNCTAD, Over the last ten years, urbanization has been most prominent in the developing economies, especially in Asia and Oceania, which saw the urban rate increase from 43.3 in 2011 to 50.0 percent in 2021.
• Based on the engine type, the market is bifurcated into diesel engines and gasoline engines. Among the two the gasoline-powered engine holds the dominating market share globally as even though diesel engines present better fuel economy and have longer engine life they have never really caught up on in passenger vehicles mainly due to reasons like gasoline engines have much lower compression ratio than diesel engines, also diesel engines tend to be heavier than normal gasoline engines. Additionally, diesel engines tend to be more expensive with high initial costs, and have lower maximum RPM than gasoline engines. Furthermore, diesel engines are hard to start in cold weather, produce more noise and vibrations, and tend to produce more smoke than gasoline engines, due to reasons like this the penetration of gasoline engines in passenger vehicles is much higher than diesel engines. For instance, on May 2020, as per The European Automobile Manufacturers’ Association (ACEA), during the first quarter of 2020, the number of diesel cars registered across the European Union plummeted by 32.6% to 738,392 units. Diesel now holds a market share of 29.9% (down from 33.2% for the first quarter of 2019) whereas petrol cars hold a whopping 52.3% of the market share. All the markets in the region went into decline, notably the four largest ones: Italy (-49.8%), France (-36.6%), Spain (-33.8%), and Germany (-23.0%).
• Based on sales channel type, the market is segmented into OEMs and aftermarkets. The OEMs hold the majority of the market share owing to reasons like OEM parts are made by vehicle manufacturers whereas aftermarket parts are produced by different companies hence quality standards of those parts are not very good and they aren’t always made with high-quality materials, so even though aftermarket parts costs less than the OEM parts, customers prefer to buy parts from OEMs as they are reliable, comes with a warranty, and the fitment of those parts are very good. Furthermore, OEM-produced components always excel in the performance front as they are designed and tested under the same rigorous manufacturers’ quality standards and are of high quality which aftermarket products often lack.
• For a better understanding of the market adoption of the Automotive EGR cooler, the market is analyzed based on its worldwide presence in the countries such as North America (U.S., Canada, and the Rest of North America), Europe (Germany, U.K., France, Spain, Italy, Rest of Europe), Asia-Pacific (China, Japan, India, Rest of Asia-Pacific), Rest of World. The Automotive EGR cooler market in the Asia Pacific region is expected to grow at a significant CAGR during the forecasted period. Owing to the rising per capita GDP of the countries in the Asia Pacific, improving the standard of living and increasing discretionary income of people, driving the consumption of the countries, and the automobile sector is the biggest beneficiary of this trend. Furthermore, governments increasing investments in the infrastructure of the countries in emerging economies are high in order to accelerate their economic growth, increasing the demand for commercial vehicles in which EGR systems are standard in order to increase their operating efficiency and decrease tailpipe emissions of harmful pollutants as compared to passenger vehicles. Furthermore, governments’ stringent laws for curtailing tailpipe emissions are forcing manufacturers to develop more efficient and sophisticated engine technologies which will require more technologically advanced and efficient EGR systems, presenting scope for innovation and growth. For instance, on Feb 2020, BorgWarner exhibited its latest petrol exhaust gas recirculation (EGR) products at the Auto Expo 2020 Components Show, they stated that its proven technologies are designed to deliver improved fuel economy and reduced emissions in preparation for tougher BS VI emission and CAFE regulations. BorgWarner’s EGR cooler technology has a high-density gasoline fin design that keeps a high heat transfer rate with a very low loss of pressure in the exhaust gases. Built for durability and performance, BorgWarner’s advanced EGR cooler is a compact, cost-effective, and easy-to-install technology engineered to reduce emissions and improve fuel economy.
• Some of the major players operating in the market include DENSO CORPORATION; BorgWarner Inc; MAHLE GmbH; Valeo; ACDelco; AMBAC International; MODINE MANUFACTURING COMPANY; Kelvion Holding GmbH; Senior Flexonics; and Nissens Automotive A/S.