Automotive Four-wheel Drive Vehicle Market - Drivers and Forecasts by Technavio

LONDON—Technavio analysts forecast the global automotive four-wheel drive vehicle market to grow at a CAGR of over 11% during the forecast period, according to their latest report.

The research study covers the present scenario and growth prospects of the global automotive four-wheel drive vehicle market for 2017-2021. Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources.

The main factors that drive the market are the growing volume sales of utility vehicles and LCVs in regions such as the US, Canada, and China. The automotive market is witnessing a rise in the volume sales of compact SUVs and crossovers due to their better affordability and lower cost of ownership. OEMs are also offering 4WD as an option in these vehicles to attract more customers. The rise of the SUV segment in APAC economies, such as China, India, and Indonesia, is another factor that propels the growth of the global automotive 4WD vehicle market.

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Technavio analysts highlight the following three factors that are contributing to the growth of the global automotive four-wheel drive vehicle market:

• Improved handling, better stability, and superior driving dynamics of 4WD system
• Booming global SUV market with growing volume sales
• Launch of new compact SUV and crossover models

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Improved handling, better stability, and superior driving dynamics of 4WD system

On-road accidents and collisions can occur due to internal or external factors depending on the situation or circumstances. They end up causing severe injuries or loss of life. Studies indicate that wet and slippery roads are the major reason for road crashes with over 73% of such collisions taking place under such conditions. When a vehicle loses traction on a slippery road, the driver loses control of the vehicle and collides into the opposite side of the road.

Siddharth Jaiswal, a lead automotive components research analyst at Technavio, says, “A 4WD system improves the off-road capability and performance of a vehicle by automatically varying the torque to all wheels. This helps in maintaining traction on rough terrains, especially when moving uphill, driving through gravel, mud, snow, and rain. The safety level of the vehicle and vehicle dynamics are also improved.”

Booming global SUV market with growing volume sales

In 2016, sales in the global automotive industry skyrocketed in almost every class of vehicles. Of all the vehicle categories and segments, SUVs and crossovers exhibited the highest sales growth. Pickup trucks also form one of the fastest growing segments with their growing popularity and increased usage for personal purposes.

“The growing demand for fuel efficiency and three-row seats in crossovers and SUVs are the main growth drivers for the global SUV and crossover market. Although SUVs and crossovers look similar, they are distinct in terms of fuel efficiency and usability. Hence, they have different markets in various regions,” adds Siddharth.

Launch of new compact SUV and crossover models

The global automotive industry is evolving rapidly with the emergence of new technologies and the launch of new vehicles. In the last decade, many new vehicles such as new-age SUVs, crossovers, and multi-purpose vehicles (MPVs) were made commercially available in the mass market. Compact crossovers and small SUVs are the new fastest growing segment and have new model launches on a frequent basis.

Many automotive exhibitions and shows are organized every year to showcase the upcoming models and advanced technologies in the automotive industry. The Frankfurt Motor Show, Geneva Motor Show, Detroit Motor show, Tokyo Motor Show, and Chicago Motor Show, are some of the prominent automotive exhibitions that unveil numerous future vehicle models and concepts.

Top vendors:

• BorgWarner
• GKN
• Linamar
• Magna
• ZF Friedrichshafen

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