AUTOMOTIVE DIFFERENTIAL MARKET

INTRODUCTION

A differential is a gear train with three shafts with a distinguished feature that the rotational speed of a shaft is the average of the speeds of the others. In automotive, the differential allows the outer drive wheel to rotate faster than the inner drive wheel during a turn. This is necessary when the vehicle turns, making the wheel that is traveling around the outside of the turning curve roll farther and faster than the other.

The average of the rotational speed of the two driving wheels equals the input rotational speed of the drive shaft. An increase in the speed of one wheel is balanced by a decrease in the speed of the other.

Electric drivelines don’t just transfer power from the differential to the wheel – they also transmit the negative torque that enables the eMotor to recharge the battery. In a hybrid drive, more efficient drive shafts can mean a smaller battery.

The quality of the systems integration, how well the software controls in different vehicle systems work together, is a big part of any hybrid or electric vehicle’s driving experience. Software control for an all-wheel drive (AWD) or electric drive system governs more than just the traction: it directly influences the vehicle dynamics, the CO2, the complete driving experience.

For hybrid all-wheel drive, on vehicles such as the Volvo XC90, the software control must also take care of details like the damping of any noise or vibrations, determining the quality of the system integration and drivetrain optimisation. Therefore, advancements in the differential market will see progress even with hybrid vehicles becoming more and more popular.

To know more about Global Automotive Drive Shaft Market, read our report

AUTOMOTIVE DIFFERENTIAL MARKET DYNAMICS

Lucrative demand for all-wheel drive automotive, rise in per capita income in many countries resulting in the sale of passenger vehicles along with the rise in the global standards of living will drive the automotive differential market size.

Furthermore, the need for better traction on roads and fuel efficiency will be significant factors that drive the growth of the automotive differential market. 

In the year 2018, India became the fourth largest automobile industry in the world, with increase in sales of 9.5% year-on-year to 4.2 million units. Passenger car technology in India will evolve from combustion engines to hybrid vehicles and eventually to electric vehicles.

Therefore, the hybrid vehicle segment will also show a need for the differential suppliers to be at par with the rising need for private ownership of vehicles.

One of the challenges for a differential supplier is the complete transformation to an all-electric drivetrain, and this is expected to happen over the course of 10-15 years since infrastructure development plays a major role in easy deployment and use of EVs.

The Asia Pacific region is estimated to dominate the automotive differential market and is projected to be the fastest growing market during the forecast period. Asia Oceania is projected to lead owing to the large vehicle production compared to other regions.

Asia Oceania contributed about 50-55% of the global vehicle production in 2020. With the increase in vehicle production, the demand for automotive differential is projected to grow at a significant rate.

Eaton Corporation, a diversified industrial manufacturer, reported several significant commercial wins in the Korean market for its locking differential products, totaling $150 million over the next six years.

The locking differentials will be used on Hyundai Motors' new Porter truck and Starex models, as well as Kia Motors' Bongo3 truck and some future sport utility vehicles. The dates will be brought in over the next two years.

Since 1993, Eaton has been producing limited slip differentials in Korea for both the domestic and export markets. 

We're thrilled that Hyundai and Kia are now using our locking differential products, which Eaton leads the world in. In severe driving circumstances, Eaton's locking differentials provide excellent traction control by locking the rear axle whenever one tyre starts to slip. They're also available on a lot of light trucks and SUVs in North America, and they've proven to be a popular choice.

AUTOMOTIVE DIFFERENTIALMARKET SEGMENTATION

• By Drive Type

  • Front wheel drive
  • Rear wheel drive
  • All wheel drive

• By Type of Differential

  • Open Differential
  • Electronic Limited Slip Differential: Electronic limited slip differential provides a vehicle with increased traction and can be extremely beneficial on wet or dry roads, providing improved handling for high-performing vehicles.
  • Locked Differential
  • Torque Vectoring Differential

• By vehicle Type

  • Passenger cars
  • LCV
  • HCV

AUTOMOTIVE DIFFERENTIAL MARKETRECENT PRODUCT DEVELOPMENT

• IntelliTrac is Eaton’s new electronically controlled limited slip differential, providing fully variable torque distribution from open to full-lock. Powerful hydraulic actuation and precision electronic controls enable an industry leading 100-millisecond response time. This enhances vehicle stability control by redirecting power to the wheels with traction and maintaining vehicle momentum in advance of brake and throttle interventions from Stability Control.

•  Dana 60 a full float axle from Dana utilizes a 3.55 gear ratio and specialized AdvanTEK technology to deliver increased torque and carrying capacity over Dana's traditional offering.  The axle will come equipped with the Spicer PerformaTraK electronic locking differential, which can transfer rear axle torque to one wheel. This ensures the wheels do not slip, providing increased traction.

• Vitesco Technology exhibits its new generation of highly integrated electric axle drive for the first time.  The EMR4 is a highly integrated, modularized, and scalable platform, covering a power range of 80 kW to 230 kW. At the same power level, the new generation axle drive is 25 percent lighter.  

• Linamar outlines a new production facility coming online, significant developments were made in the portfolio of EV focused solutions which includes continued enhancements and features to the light vehicle eAxle systems, Commercial Vehicle eAxle development projects. 

• JTEKT Corporation has developed the 5th generation Low-Friction-Torque tapered roller bearing“LFT-V” used in transmissions, pinion support of differential units and other applications.  LFT-V as a product t contributes to the low fuel consumption, high efficiency of automobiles, and moreover corresponds to electric units. 

• ZF has developed a new electric driveline based on 800 volts and this will go into series production in 2ndhalf of 2021. The electric vehicles that will be equipped with this new electric drive starting in 2021 can be charged with over 350kW and in about 20-30 minutes, enough electrical energy for the next 300 kilometers flows into the drive batteries at every charging stop.

AUTOMOTIVE DIFFERENTIAL MARKETCOMPETITIVE LANDSCAPE

• GKN Automotive: is one of the pioneers in automotive driveline technology, and 50% of all cars sold every year contain GKN’s driveline technology.
• BorgWarner Inc: is an American automotive components and parts supplier and in fact provides driveline components to all the 3 major American OEMs. 72% of BorgWarner’s sales are in the light vehicle segment. BorgWarner said it is passionate about inventing the next ground-breaking technology to improve handling, traction and stability to front wheel drive vehicles.
  • Borg Warner’s net sales for the Q1-2021 increased by as high as 76% compared to the same period in 2020. The acquisition of Delphi Technologies increased the companies’ demand in the global market.
• Eaton: is an American-Irish manufacturer of electrical and industrial products. In terms of differential, their Limited slip differential was the most successful and widely used differential during the time.
  • The differentials and other transmission control devices account for ~11% of the company’s overall revenue. In 2020, the sales dropped by 17% from $21.3B to $17.8B
  • In Q1-2021, the sales dropped by 2% compared to same period in 2020 and ended at $ 4.6B
• ZF Friedrichshafen AG: is a German car parts manufacturer and their differential for SUV application was the most widely used differential during the year 2018. They are also a leader in manufacture and supply of transmission systems, especially to vast majority of public transport systems in Europe.
• Dana
  • Sales in Q2-2021 increased by $1.1B compared to same period in 2020 and ended with $2.2B. After 6 months in 2021, the sales improved by ~33% compared to previous year it was ~$ 4.4B
• Schaeffler Technologies AG & Co. KG
• Continental AG
• JTEKT Corporation
• American Axle & Manufacturing Inc.
• Linamar Corporation
• BorgWarner's new integrated Drive Module (iDM) supports global automakers in their mission to produce cleaner and more efficient vehicles.

AUTOMOTIVE DIFFERENTIAL MARKETMERGERS AND ACQUISITIONS

• BorgWarner’s integrated drive module (iDM) was selected by the Hyundai Motor Group for its power electric system, which will be used in the upcoming A-segment electric vehicle production, planned to start in mid of 2023. With its state-of-the-art electric motor, gearbox and integrated power electronics. 
• Two of the Detroit’s automobile giants— General Motors Co. and American Axle & Manufacturing Inc.  announces their partnership for a new Independent Rear Drive Axle for future SUVs.
• In January 2020, BorgWarner and Delphi Technologies announced that BorgWarner will acquire Delphi for $3.3 billion to expand its ability to supply hybrid and electric vehicles.
• In late 2007, Eaton acquired the MGE Office Protection Systems division of Schneider Electric, because of Schneider’s acquisition of APC. A Taiwanese manufacturer, Phoenixtec, was also acquired giving the company the highest share in the Chinese single-phase UPS market.
• On 21 May 2012 Eaton announced that they had agreed to purchase Ireland based Cooper Industries in a cash-and-stock deal valued at about $11.46 billion. The new company is called Eaton Corporation plc and is incorporated in Ireland.
• In 2014, ZF acquired American auto parts manufacturer TRW Automotive for $13.5 billion. In 2020, ZF acquired WABCO, which will be integrated into ZF as its Commercial Vehicle Control Systems Division. 

AUTOMOTIVE DIFFERENTIAL MARKETCONCLUSION

Automotive differentials are seeing a changing landscape with the introduction of hybrid as well as electric vehicles. Large scale usage of electric vehicles currently remains the top threat for the automotive differential market. AWD segments are expected to a rise in number and sales and therefore this segment is a promising sector for differentials.

Companies like GKN are majorly advancing their R&D to cater to the needs of AWD SUVs which are expected to have a big chunk of the market. Nonetheless, the transition to electric drive is gradual and until then gasoline engines are most preferred among the common man, especially in a country like India, and therefore the differential segment is definitely set to see an increase in the growth rate in the next 5 years.

AUTOMOTIVE DIFFERENTIAL MARKETCOMPANIES PROFILED

• GKN Automotive
• BorgWarner Inc
• Eaton
• ZF Friedrichshafen AG
• Dana
• Schaeffler Technologies AG & Co. KG
• Continental AG
• JTEKT Corporation
• American Axle & Manufacturing Inc.
• Linamar Corporation

AUTOMOTIVE DIFFERENTIAL MARKETREPORT WILL ANSWER FOLLOWING QUESTIONS

1. Automotive Differential Market size and Forecast, by region, by application
2. Average B-2-B price for Automotive Differential Market, by region, per user
3. Technology trends and related opportunity for new Automotive Differential Market tech suppliers
4. Automotive Differential Market share of leading vendors, by region,
5. Coronavirus impact on Automotive Differential Market earnings