Global Automotive Engine Market 2021-2026

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    AUTOMOTIVE ENGINE MARKET

     

    KEY FINDINGS

    1. The global automotive engine production in 2020 dropped to ~74M units from 91M units in 2019.
    2. Every major OEMs have set themselves a timeline which involves the slow termination of engine production.
    3. Most of the major OEMs have preferred to cease the production & sales of ICE vehicles first in Europe as the emission norms of stricter and the EV adoption is much quicker than other regions
    4. Gasoline Direct Injection (GDI) is the most popular technology adopted in engine production as it has much higher impact on efficiency than other technologies.
    5. OEMs such as Mercedes, BMW, VW, Mazda are leading the adoption of GDI globally.
    6. Toyota, VW Group Honda, GM and Ford are the major automotive engine producers.  

     

    INTRODUCTION

    With stricter emission norms, rise in EV production and increase in prices of ICE vehicles in some regions one would assume the automotive engine will witness a sharp decline in production. However, the global volume of ICE vehicles is enormous which will cause the delay in the makeshift and also EVs are facing a certain set of hindrances in few regions (India, Latin America & others) which has ensured the automotive engine market to hold its ground.   

     

    Due to slow adoption of EVs and PHEVs in growing markets like India, South East Asia and Latin America the ICE vehicles will continue to remain in the focus for a few more years if not decades.

     

    Many mechanical components like oil pump, coolant pump, HVAC compressor will be electrified and thus the sub-component suppliers need to align themselves with this global vehicle electrification trend to stay relevant.

     

    AUTOMOTIVE ENGINE MARKET DYNAMICS

    In order to improve the efficiency in parallel to complying with emission norms OEMs have been adopting different engine technologies over the past few years. Gasoline Direct Injection (GDI) has witnessed higher adoption than any other technologies.

     

    8 of the largest car manufacturers installed GDI in more than 75% of the vehicles they produced, with several near the 100% mark.

     

    Turbo charging and stop/start are two other engine technologies that reached a production share of about 30% Whereas, Cylinder Deactivation (CD) technology was at 12%

     

    At the Zwickau plant in Germany, VW produced its last car with a combustion engine. From the beginning of 2021, the Zwickau plant produced only VW’s ID.3 and ID.4 models.

     

     

    AUTOMOTIVE ENGINE MARKET SEGMENTATION

    Infographic: Automotive Engine market , Diesel engine market, Gasoline Engine market, Turbocharger market, Fuel injection system market

    By Geography

    • US
    • Europe
    • China
    • Asia Ex China
    • ROW

     

    By Vehicle Type

    • Passenger Cars
    • Commercial Vehicles
    • Motorcycles

     

    By Engine Capacity (in cc)

    • <1,000
    • 1,000-2,000
    • 2,000-3,000
    • >3,000

     

    By Propulsion Type

    • Petrol
    • Diesel
    • Natural Gas
    • Bio-Fuel

     

    By Sub-Component

    • Fuel Injection System
    • Piston
    • Intake Manifold Valvetrain
    • Turbocharger

     

    AUTOMOTIVE ENGINE MARKET BY GEOGRAPHY

    In US, the average size of engine is 3.5L among the top 10 selling vehicles. The number is much higher among the top 5 sellers as it is dominated by pick-ups and SUVs, it is around 5L.

     

    V6 was the most common cylinder design in the region, followed by inline 4 type.

     

    In Europe, the average size of engines is only 1.2-1.5L among the top sellers. Likewise, the cylinder arrangement design was mostly inline 4 type and some of them were inline-3 too.

     

    The percentage of GDI engines was higher in US and Europe. Almost every gasoline driven car in these regions were of Direct Injection type.

     

    The average size of engines in China was around 1.5-2L among the top 50 selling cars in 2020. Toyota RAV4 was one of the very few models to be equipped with a 2.5L engine. Almost 95% of these cars were fitted with inline 4 cylinder design with few models of inline 3 type.

     

    In China, 5 out of top 10 sellers were fitted with the GDI engines, whereas the rest of them were MPFI.

     

    GLOBAL AUTOMOTIVE ENGINE PRODUCTION

     

    Infographic detailing automotive engine production grew from 89.7 Million units to 95.7 million units in 2018

     

     

    The global automotive engine production volume was ~96 Million units in 2018 and in 2019 it declined by 5-6% to 91M units. In 2020, the production number declined by ~19% to 74M units. By 2025, it is estimated that the annual production will come down to 90M units.

     

    In UK, engine production in 2020 fell by 27%, one of the few regions which witnessed a steep fall in production. The production numbers declined from 2.5M to 1.8M units from 2019 to 2020.

     

    According to UK’s SMMT, engine production in May 2021 was double compared to the same month in 2020. UK factories produced 116,639 units in May 2021. However, this figure is still 47.6% down on the five-year average for the month.

     

    In the Jan-May period the production increased by 18.8% Y-o-Y, while the demand was driven by the domestic market.

     

    GLOBAL AUTOMOTIVE ENGINE PRODUCTION MARKET SHARE

     

    iNFOGRAPHIC- Global Market Share of Engine production- Toyota and VW are the market leaders with 22% share cumulatively

     

    During 2014-2017,the market share of automotive engine manufacturers has remained almost same for top 2 players but it has declined for General Motors and Hyundai-KIA. Renault-Nissan alliance and Honda have been able to increase their share from 8.6% to 10.1% and 5% to 5.4% respectively.

     

    FUTURE OF DIESEL ENGINE MARKET

    The global Commercial vehicle market is estimated at ~10 Million units per annum and 80+% of them are powered by Diesel, and the rest by natural gas, electricity and gasoline. In the passenger car segment, estimated at ~80 Million units per annum ~87% are powered by gasoline and the remaining by Diesel, CNG/LPG.

     

    The world’s biggest diesel engine factory Tremery, France has shifted its interest in producing electric motors. From less than 10% of output in 2020, electric motor production at the factory will double to around 180,000 in 2021. The number is expected to reach beyond 900,000 units per year by 2025.

     

    Diesel car sales in Europe shrunk from 32% share in 2019 to 28% in 2020. The number is expected to decline further in the coming years with many OEMs putting an end to the production of diesel models.

     

    Infographic : Diesel engine market, Automotive Engine market, Diesel engine market in Europe

     

    In US, passenger vehicles propelled by diesel accounted for only 4.5% of the overall sales. About 650,000 diesel run passenger vehicles were sold in 2020 and the pick-up segment occupied the highest share

     

    In India, the diesel-powered passenger cars share dropped from 32.5% to 18.6% in 2020. The transition of BS4 to BS6 led to the increase in prices of these cars. This also led to discontinuation of entry level diesel models of many OEMs.

     

    FUTURE  OF GASOLINE ENGINE MARKET

    With Diesel`s share shrinking, gasoline engine is now the prime focus for further improvement. Going forward, we can expect the integration of Atkinson and Miller cycle engines + GDI (Gasoline Direct Injection) + VGT (Variable Geometry turbo) on a much bigger scale.

     

    Currently, almost every gasoline powered car from Mercedes is fitted with the GDI engines. Apart from Mercedes, VW, BMW and Mazda are the other 3 OEMs who have adopted the GDI engines in most of their models.

     

    Toyota and FCA vehicles had one of the lowest penetrations of GDI models with less than 10% across the world.

     

    PSA vehicles have incorporated GPF in all its gasoline direct injection engine models from December 2017.

     

    BY OEM

    VW– Audi`s revised 2.5L TFSI is now more compact and 26kg lighter than the previous model. Fitting the engine with an aluminium crankcase alone allowed Audi to achieve weight reduction of 18kg.

     

    Toyota– World`s second biggest producer of auto engines after VW group in 2019 had highest share(~52%) of electrified vehicles globally, and 100% of them are powered by gasoline engines.

     

    Hyundai- KIA – In July 2019, Hyundai showcased its new  CVVD(Continuously variable valve duration) engine, which regulates the duration of valve opening and closing as per driving conditions. This optimization provides 4% boost in performance, almost similar improvement in fuel efficiency, and 12% emissions reduction.

     

     

    FUTURE  OF CNG AND LPG ENGINE MARKET

    In Europe, the LPG fuelled cars’ registration increased steeply in the 4th quarter of 2020 and for the entire year about 200K units were sold in the alternative fuels segment. These vehicles accounted for 2.1% of the overall market share

     

    The LPG market is bigger than the CNG sector in Europe. Italy was leading in the sales of LPG passenger vehicles followed by Spain.

     

    Infographic: CNG engine market, Automotive engine market in Europe, LPG engine market in Europe,

     

    In March 2020, VW Group stopped the production of Natural Gas fuelled cars as the OEM wants to focus more on EVs and are planning to hit 32M units of EVs by 2029.

     

    The drop in demand for diesel vehicles has also benefited CNG vehicles in India. CNG cars’ share in India increased to 6.1% in 2020 from 3.55% in 2019.

     

    MAJOR OEMs PHASING OUT ICE VEHICLES

    • Opel recently in July 2021, announced it would be stopping passenger cars with combustion engines from 2028 in Europe.

     

    • In June 2021, Audi announced that it will stop manufacturing diesel & petrol cars from 2033. Audi aims to have more than 20 e-models in its line-up by 2025.

     

    • BAIC, one of the leading car manufacturers in China, is planning to stop production & sales of ICE vehicles across China by 2025.

     

    • German automobile giant Volkswagen has announced it would stop the production of engine run cars by 2023-2035 period in Europe.

     

    • Mercedes-Benz is planning to phase out the ICE vehicles by 2039.

     

    • Sweden manufacturer Volvo is planning to have only EVs in its global product line-up by 2030.

     

    LATEST TRENDS IN AUTOMOTIVE ENGINE MARKET

    • In March 2021, Subaru launched the new Outback in the European market and is equipped with 2.5L Direct Injection, naturally aspirated, horizontally opposed 4-cylinder engine.

     

    • In November 2020, Chinese manufacturer BYD unveiled a high-efficiency version of the 1.5-L Xiaoyun engine, dedicated for use with PHEV.

     

    • New Ram 1500 TRX is equipped with a 6.2-liter supercharged Hemi V8 engine and it is rated with 702HP output power and 881 Nm of torque.

     

    • In August 2020, GM introduced a new 5.7L V8 350 small-block engine, expected to replace the power unit for older SUVs, trucks and vans.

     

    • In 2020, FCA launched a new 12-volt BSG 3 cylinder 1.0L naturally-aspirated engine for the models Fiat Panda, Fiat 500 and Lancia Ypsilon in Europe.

     

    • In 2020, FCA developed a new 3.0L V-6 gasoline engine adding turbulent jet ignition (TJI) technology, increasing power output.

     

    AUTOMOTIVE ENGINE  MARKET SIZE AND FORECAST

    The automotive engine market is estimated to be $XXB in 2020 and is estimated to be $ XXB by 2026 and the CAGR for the period (2021-2026) is estimated to be XX%.

     

    The cost of engine has grown significantly over the years with the incorporation of 48V mild-hybrid engines in passenger cars.

     

    These mild hybrid engines are slowly expected to be adopted by 2-wheelers too. In June 2021, Yamaha launched India’s first mild-hybrid scooter.

     

    COMPETITIVE LANDSCAPE

    The top 5 producers of automotive engines are VW, Toyota, General Motors, Honda and Ford Motor Company.

     

    Revenue generated from the Cummins’ engine segment shrunk by 2% to 32% in 2020. Cummins manufactures engines with a displacement range of 2.8 to 15L and horsepower ranging from 48 to 715.

     

    Cummins’ major customers in the heavy-duty truck engine segment include PACCAR, Navistar and Daimler Trucks.

     

    The main players in the LPG market are FCA (now part of Stellantis) and Renault. In 2019, Renault Duster was Italy’s top-selling LPG model followed by the Panda and Lancia Ypsilon minicars.

     

    COMPANY PROFILES

    1. Toyota Motors
    2. General Motors
    3. Hyundai- KIA
    4. Ford Motor Company
    5. Nissan Motors
    6. VW Group
    7. BMW Group
    8. Daimler AG
    9. SAIC 
    10. Geely Group
    11. Cummins 

    KEY CONTENTS OF THE REPORT INCLUDE

    1. The most important shift in OEMs engine development and manufacturing
    2. Is there a growing market for innovative engine coating/ thermal encapsulation
    3. What will be the future of non-electric, alternate fuel engines like CNG, LPG and E85
    4. Top 10 engines and their derivatives which will power 31% of global production in 2021
    5. In the light of declining diesel passenger vehicle sales,what will happen to CRDI system market and its sub-component manufacturing?
    6. Market Dynamics (Trends, Drivers, and Challenges)
    7. OE-supplier alignment in the automotive engine market
    8. Market share and competitive landscape of Global Automotive Engines Market
    9. R&D Capex for 2019-2025
    10. Market Size, Market Segmentation, Market Forecast (Volume and Value)
      1. Fuel type (Gasoline, Diesel, CNG, LPG, E85)
      2. Sub-components( Piston, Crankshaft, Valves,fuel injection system, Cylinder head,Thermal management, Pumps)
      3. Power output(HP) (<100,100-150,150-250,>250)
      4. Geography (Asia, Europe, North America and Special focus on China)
      5. Vehicle Application  (Passenger Vehicle and Commercial Vehicle)
      6. Engine sourcing(in-sourced and outsourced)

     

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    1 Market Segmentation 3
    2 Executive Summary 5-8
    3 Introduction 9-15
    4 Insights from Industry stakeholders 16-17
    5 Engine manufacturing in US, Europe and China 18-19
    6 Engine cooling trends, by engine capacity 20-23
    7 Turbocharger penetration, by OEM 24-27
    8 GDI Penetration, by OEM 29-32
    9 Breakdown of new concept vehicles by ICE powertrain 33-38
    10 Engine Light-weighting trends 39-41
    11 Integration of ISG in Automotive Engines, by region, by OEM 41-44
    12 Integration of Cylinder deactivation, by region, by OEM 44-47
    13 Internal friction reduction and coating trends, by region, by OEM 48-51
    14 Improvement in Piston and combustion bowl in past 5 years 52-55
    15 Market Size, Dynamics and Forecast by Engine Displacement 56-75
    16 Market Size, Dynamics and Forecast by Sub-component 76-100
    17 Market Size, Dynamics and Forecast by Geography 101-125
    18 Market Size, Dynamics and Forecast by OEM 126-140
    19 Competitive Landscape 141-142
    20 Market share of sub-component suppliers 143-144
    21 Company Profiles 145-155
    22 Unmet needs and Market Opportunity for suppliers 156-157
    23 Conclusion 158
    24 Appendix 159-160
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