The All Wheel Drive market will reach $65.27 billion by 2031, at a CAGR of 7.9%, says Coherent Market Insights

The global all-wheel drive market is estimated to witness high growth due to increasing consumer demand for enhanced safety and improved ride quality. The market is estimated to be valued at USD 38.24 billion in 2024 and is expected to exhibit a CAGR of 7.9% during the forecast period 2024-2031, according to a new report by Coherent Market Insights. Companies covered: AB Volvo, American Axle & Manufacturing, Inc., BorgWarner Inc., Continental AG, Dana Incorporated, GKN Plc, Honda Motor Company Ltd., JTEKT Corporation, Magna International Inc., Nissan Motor Co., Ltd., Tesla, Inc., Valeo SA, ZF Friedrichshafen AG

Burlingame, July 05, 2024 (GLOBE NEWSWIRE) — The global all-wheel drive market, valued at USD 38.24 billion in 2024, is on a rapid expansion trajectory, with forecasts showing it will grow to USD 65.27 billion by 2031, growing at a compound annual growth rate (CAGR) of 7.9 % from 2024 to 2031, according to a recent report. from Coherent Market Insights. Increasing demand for vehicles that offer better safety and traction. All-wheel drive systems allow power to be distributed to all wheels of a vehicle for better handling during cornering and braking on slippery surfaces such as wet or snowy roads. This provides significantly more control and stability on two-wheeled vehicles, especially in slippery conditions. As roads become more congested and weather more unpredictable due to climate change, consumers are increasingly prioritizing safety features in their vehicle purchases.

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Market dynamics:

The all-wheel drive market is driven by increasing consumer demand for improved safety and improved ride quality. All-wheel drive vehicles offer better traction, control and stability on slippery roads and off-road surfaces. This has led to increased preference among consumers globally. Moreover, with increasing disposable income, customers are willing to pay a higher price for vehicles with all-wheel drive configuration due to perceived premiumization. However, all-wheel drive also increases weight and reduces the fuel economy of the vehicle, which may restrain market growth.

Market trends:

There is an increase in consumer preference for sports utility vehicles (SUVs) globally due to changing lifestyles. SUVs are mostly available with all-wheel drive or four-wheel drive to offer higher ground clearance and better off-road capabilities. This has accelerated the demand for all-wheel drive vehicles. According to IHS Markit, the SUV segment is expected to grow by over 25% through 2026 in the US.

The story continues

The all-wheel drive configuration is mostly offered in premium and luxury vehicles to improve driving dynamics. With rising disposable incomes, sales of luxury and premium vehicles have witnessed strong growth especially in the emerging economies of Asia Pacific and Latin America. This is expected to generate significant demand for all-wheel drive vehicles.

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Market opportunities:

The growing adoption of electric vehicles is expected to drive the demand for all-wheel drive systems. Since electric vehicles are heavier than conventional ice vehicles due to large battery packs, all-wheel drive provides better traction and handling. This is especially important in difficult weather conditions with wet or slippery roads, where electric vehicles need maximum control and control. All-wheel drive distributes torque to both the front and rear wheels for improved acceleration and control. Several new electric vehicle models are being launched with standard all-wheel drive systems to offer drivers confidence in all weather conditions. For example, the Tesla Model Y SUV and Model X crossover are available with all-wheel drive.

All Wheel Drive Market Report Coverage

Growing demand for performance vehicles among enthusiasts is another key driver for the all-wheel drive market. All-wheel drive provides better acceleration, handling and allows drivers to make better use of the vehicle’s full power, especially during acceleration. This makes all-wheel drive very attractive for performance vehicles. Some high-performance vehicles such as sports cars, supercars and high-end SUVs are being offered with standard all-wheel drive. For example, most variants of the Lamborghini Urus, Ferrari Roma and Porsche 911 now come with all-wheel drive as standard. This is expected to further drive the adoption of all-wheel drive systems in performance-oriented segments.

Key market relationships

The all-wheel drive market is projected to witness a CAGR of 7.9% during the forecast period 2024-2031, owing to the growing demand for electric vehicles and performance-oriented vehicles.

On the basis of type, the manual segment is expected to hold a dominant position, accounting for nearly 60% of the market share by 2031, owing to their simplicity and relatively lower costs compared to automatic all-wheel drive systems.

On the basis of thrust, the electric vehicle segment is projected to witness the fastest growth during the forecast period owing to the increasing prevalence of electric vehicles that require superior traction.

Based on vehicle type, the passenger vehicle segment accounts for around 65-70% of the market. However, the commercial vehicle segment is expected to show higher growth driven by growing demand for SUVs, crossovers, pickup trucks and electric vans.

On the basis of application, the on-road segment dominates with around 75% share due to its wide spread in passenger cars, SUVs and crossovers. However, off-road vehicles will witness higher growth driven by demand from recreational vehicles and light commercial vehicles.

Regionally, North America is expected to maintain its dominance in the global all-wheel drive market, holding around 35-40% share due to extreme weather conditions and increasing adoption of electric vehicles in the US and Canada.

Some of the key players operating in the all-wheel drive market include ZF Friedrichshafen AG, Magna International Inc., BorgWarner Inc., GKN Automotive Limited, Eaton Corporation, Dana Inc., Oerlikon Graziano, Jtekt Corporation, and Continental AG. These players are focusing on partnerships, new product development and integration of advanced electronics to strengthen their market positions.

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Recent developments:

In January 2021 – Kia Motors which is a South Korean automobile company added the introduced and all-wheel drive vehicle, Kia K5, which is well equipped with all the necessary features.

Market segmentation:

By disc type:

from Vehicle type:

• Passenger car

• Commercial vehicle

Push:

from Application:

By region:

North America:

Latin America:

• Brazil

• Argentinian

• Mexico

• The rest of Latin America

Europe:

• Germany

• uk

• Spain

• France

• Ital

• Russia

• The rest of Europe

Asia Pacific:

• China

• Indian

• Japan

• Australia

• South Korea

• ASEAN

• Rest of Asia Pacific

Middle East:

• GCC countries

• Israel

• The rest of the Middle East

Africa:

• South Africa

• North Africa

• Central Africa

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