European Advanced Steering Systems Market Experiences Strong Growth; North America Catching Up

LONDON, January 13 -- There is considerable excitement in the European advanced steering systems market as rapid developments have seen it moving from a single monopolistic technology - hydraulic power steering (HPS) - to multiple steering technologies, all fiercely competing for market dominance.

These innovative technologies such as electronic power steering (EPS), electro-hydraulic power steering (EHPS) and active front steering (AFS) have taken away a chunk of the market share from HPS systems. It is estimated that they will together account for more than 70 per cent of the European market in 2010.

"Due to the diverse portfolio of steering technologies available, the opportunity for the first time in the industry to network steering with chassis to improve safety and driving experience and the ability of these steering systems to provide additional driver assistance features, this industry is currently one of the most exciting markets to be in," remarks Frost & Sullivan (http://transportation.frost.com) Research Analyst Mr. Jatin Khanna.

New analysis from Frost & Sullivan reveals that the total European market for advanced steering systems is expected to increase gradually to reach 3.92 billion euros in 2010 at a compound annual growth rate (CAGR) of 2.5 per cent between 2003 and 2010. This growth is likely to be chiefly driven by EPS systems. The total North American market is expected to expand at a lower CAGR of about 0.4 per cent during the same period to reach approximately US$3.36 billion in 2010.

On the whole, therefore, the forecast for the European market is rather more positive than that for North America. The European market appears to be far more responsive and open to advanced technologies than the one in North America.

EPS is expected to be the technology of choice in Europe by 2010. These systems grew by a massive 250 per cent between 2001 and 2003 and are likely to completely dominate next-generation lower and medium segment vehicles in the short to medium term. Various factors such as a favourable legislative environment, the growing demand for energy-efficient systems and higher end-user acceptance of advanced functionalities have been responsible for this phenomenal growth.

"EPS systems are more fuel efficient than conventional hydraulic steering systems, and provide savings as high as 0.2 litres to 0.3 litres per 100 kilometres," explains Mr. Khanna. "Vehicle manufacturers are keen to introduce value-added features such as automatic parking assistance or external disturbance compensation in the current and next-generation models, which not only enhance driver convenience, but also provide a source of revenue for suppliers and automakers through 'optional' sales."

AFS and steer-by-wire (SBW) systems in Europe are also expected to gain in popularity and witness increased development, giving customers a wider choice of technologies to choose from. With its potential to deliver enhanced driver comfort and convenience, AFS is attracting greater interest from European original equipment manufacturers (OEMs) for use in their D and E segment vehicles.

Trends in the North American market indicate that HPS systems are likely to continue to prevail, with future growth hinging on improving upon existing systems. This could be attributed to the reluctance of the North American consumers, and indeed the cost-conscious market itself, to experiment with advanced technologies. Vehicle manufacturers are wary of enhancing their budgets to accommodate such systems, believing that there is no real need for them.

However, AFS and rack EPS systems have a bright future in both Europe and North America, with premium heavy vehicles expected to adopt them in the long term. Rack EPS is poised to become a favoured choice for heavy vehicles. With the uptake of these technologies, there is potential for significant revenue growth from 2010 onwards.

Although the penetration rates of electric steering systems have not been as high in North America as in Europe, the gap between the two is expected to narrow. With increasing acceptance among OEMs and more affordable prices, the North American market is showing greater interest in adopting advanced steering technologies.

If you are interested in a summary of this research service providing an introduction to the Strategic Analysis of the Advanced Steering Systems Market in Europe and North America, please send an email to Magdalena Oberland, Corporate Communications at magdalena.oberland@frost.com with the following information: full name, company name, title, country, contact telephone number, email. Upon receipt of the above information, the summary will be emailed to you.

Title: Strategic Analysis of the Advanced Steering Systems Market in Europe and North America

Code: B387

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