Market Trends of Automotive Glow Plugs Industry
This section covers the major market trends shaping the Automotive Glow Plugs Market according to our research experts:
High Demand for Commercial Vehicles Across the World
Commercial vehicles are witnessing high demand, worldwide, with high-capacity utilization and profitability driving the momentum for fleet renewal and expansion activities. Strong and sustained freight demand, worldwide, and the growth of the e-commerce industry are propelling the operators to purchase new commercial vehicles. The overall macroeconomic environment has been favorable, with robust utilization and profitability across operators, boosting fleet renewals and expansions at an accelerated pace.
The demand for pickup trucks is also picked growth since the past few years, especially in North America and Europe, due to the growing preference for multi-purpose utility and better comforts among buyers. Witnessing an accelerated growth in the segment, automakers, in recent years, have started introducing new vehicle models with enhanced performance and efficiency. For instance, in June 2020, Ford unveiled the 2021 F-150 pickup truck, including a hybrid version with new features, like a segment-first hands-free highway driving system, 12-inch screens, and over-the-air updates. The new pickup truck is also claimed to have better fuel efficiency and performance.
The commercial vehicle market witnessed a decline in 2020, which was primarily attributed to the COVID-19 pandemic and associated lockdown that halted vehicle production and sales activities in the majority of the countries. However, the demand for commercial vehicles is likely to resume its growth post FY21. Before COVID-19 hit, the sales of commercial vehicles were growing across the world. For instance, in 2018 and 2019, global commercial vehicle sales increased by 8.01% and 0.19%, respectively, as compared to the previous year.
Furthermore, the rising concerns about environmental pollution are encouraging the governing bodies to take steps to curb emissions occurring from commercial vehicles. Thus, this is likely to drive the demand for glow plugs that helps in efficient fuel combustion and enhances vehicle fuel efficiency.
Asia Pacific is Expected to Lead the Market
China is of the largest markets for automotive vehicles, worldwide. From 2008 to 2019, the share of China in global vehicle production experienced a two-fold increase from 13% to 28% in 2019. Meanwhile, vehicle sales in China went up significantly, and the annual growth rate varied over the same period, reaching a peak of 45% in 2009. However, it has been experiencing a contraction since 2018. Nonetheless, the Chinese automobile market shrank by only 1.9% in 2020, with economic stimulus softening the blow of the COVID-19 pandemic.
Major companies in the country are investing in increasing their production capacities. For instance, in April 2021, FAW Jiefang Automotive Co. Ltd (FAW Jiefang) started constructing its commercial vehicle manufacturing site in the city of Guanghan in Sichuan Province. The 552,000 sq. m facility is likely to be a commercial vehicle manufacturing site, with an annual production capacity of 100,000 units. With an investment of CNY 1.6 billion, the first phase has a planned annual capacity of 50,000 units. The J6-series models are anticipated to be manufactured during the initial operation period of the site.
Automotive is one of the core sectors of the Indian economy and, to a great extent, serves as one of the leading industries in the country. The Government of India implemented BS-VI norms for automobiles to be sold after April 1, 2020. The glow plug manufacturers are launching the latest products to meet the regulatory norms to stay ahead of their peers and gain market share. For instance, in February 2020, NGK Spark Plugs India Private Limited launched a new range of BS-6 Ready and BS-6 compliant glow plugs for diesel vehicles in the country. The company is a leading supplier of spark plugs, glow plugs, and oxygen sensors to leading 2-wheeler and 4-wheeler OEMs in India. In the retail sector, NGK India has a strong pan-India presence, with approximately 200 plus distributors selling NGK high-quality products to retailers and mechanics catering to the 2-wheeler, 3-wheeler, and 4-wheeler segments.
