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Automotive Steel Market By Vehicle Type (Passenger Vehicles, Light Commercial Vehicles, Heavy Commercial Vehicles), By Type (Mild Steel, Alloy Steel, High Strength Steel, Advanced High Strength), By Application (Body-in-White, Drive Train, Suspension, Others) - Growth, Future Prospects & Competitive Analysis, 2018 – 2026

Steel is being used as stamping by automakers around the world to achieve desired strength standards as well as vehicle safety at lower costs. The metallurgical designation of vehicles incorporates the use of low-strength steels, conventional high-strength steel (HSS), and the new advanced high-strength steel (AHSS). The transportation industry's emphasis on reducing greenhouse gas emissions and improving fuel efficiency has resulted in the development of high-strength steel with improved features such as formability and crashworthiness (the performance of vehicles in protecting their occupants in the event of a crash). There is an increased use of advanced high-strength steel owing to its excellent mechanical properties, such as higher strain hardening capacity, toughness, ductility, and fatigue properties. Automobile manufacturers achieved certain standards of strength and safety in vehicles at lower costs thanks to the rapid adoption of steel.

There is increased demand for light-weight steel among industry players in order to enhance the safety and fuel economy of vehicles. This has forced steel manufacturers to develop materials with properties such as manufacturability, durability, and quality, as well as low costs. The development of AHSS (advanced high-strength steel) has catered to the growing industry challenges of meeting the strength requirements for diverse vehicle components. This market expansion is also attributed to the urgent need to reduce vehicle mass through the optimization of vehicle designs, thereby improving fuel efficiency. In addition to it, the improved crash performance offered by the use of advanced high-strength steel is another driving factor for the market. Pollutant emission limits for diesel and gasoline vehicles, as well as fuel economy standards to reduce energy consumption, all increase product demand and drive the market. Growing car ownership and rising income levels imply strong growth potential in developing economies such as India and China. However, the rising scope of aluminum in automobile manufacturing, owing to its light-weight and compliance with a favorable regulatory environment, is expected to hinder the global automotive steel market in the coming years.

Geographically, Asia-Pacific dominated the market in 2017 and is projected to continue its dominance during the forecast period on account of rising disposable income, new launches by original equipment manufacturers (OEM), as well as rising investments towards the development of infrastructure, and the growing need for commercial vehicles for transportation purposes. Additionally, increasing sales of low-priced cars, which heavily incorporate steel and its components, further propel the market's growth. Apart from this, Europe and North America are expected to be the other major markets after Asia-Pacific, owing to rapid industrialization, a high urban population, and an improving GDP growth rate in countries such as the U.S. and Canada, which is projected to positively impact the automotive sector and in turn lead to increased steel demand. Latin America, the Middle East, and Africa are witnessing technological advancements as well as a shift in consumer lifestyles, which is bound to grow the market during the forecast period.

Some of the key players profiled in the market include ArcelorMittal, United States Steel Corporation, Severstal, Baosteel, JFE Steel Corporation, Nippon Steel, POSCO, ThyssenKrupp, Hesteel Group, and TimkenSteel.

On the basis of its vehicle type, the global automotive steel market is categorized into the following segments:

  • Passenger Vehicles
  • Light Commercial Vehicles
  • heavy commercial vehicles

Automotive manufacturers are involved in designing lightweight vehicles with more fuel-efficient engines so as to reduce fleet consumption in accordance with legal regulations, which has led to the utilization of advanced high-strength steels (AHSS) in passenger vehicles. These steels improve the crash performance and long-term durability of small vehicles. Therefore, passenger cars dominated the market in 2017 and are projected to maintain their dominance in the years to come owing to the rising sales of passenger cars coupled with the rise in per capita income of consumers in developing countries such as India, China, and Brazil.

Moreover, medium and heavy-duty trucks are projected to exhibit potential growth in the near future as these vehicles are used for purposes such as freight movement, towing, and off-road purposes. Therefore, high-strength steels are increasingly used in automobiles while being designed so as to meet safety and crash-test ratings, which is expected to boost the global automotive steel market.

On the basis of its type, the global automotive steel market is categorized into the following segments:

  • Mild Steel
  • Alloy Steel
  • high-strength steel
  • Advanced High-Strength Steel (AHSS)

In 2017, high-strength steels accounted for a significant share of the market and were expected to remain dominant throughout the forecast period. High-strength steels are carbon manganese-strengthened steels consisting of other microalloying segments, namely titanium, vanadium, niobium, etc. These steels find vast utilization among vehicles, both in body closures and in energy-absorbing areas. Enhancement of electric motors' efficiency, range, and power with the use of high-strength steels are some of the other factors driving the market.

Advanced high-strength steels (AHSS) are being rapidly adopted among vehicles as compared to their counterparts, such as aluminum, magnesium, and composites, as their utilization generates 20 times less carbon dioxide. Further, implementation of AHSS tends to reduce vehicle weight by 10–20%, thus driving the market growth. Additionally, AHSS is easily stamped and molded into new parts without the need for additional investments in infrastructure. Currently, certain industry players, such as General Motors, a Chevrolet subsidiary, have successfully implemented AHSS for their 2016 Chevrolet Malibu to ease the four-inch wheelbase stretch and, as a result, reduce the vehicle's weight by 300 pounds when compared to the earlier 2015 model. Apart from this, the lesser carbon footprint achieved through the use of AHSS attracts car makers and car owners towards its increased adoption in vehicle manufacturing, in turn stimulating market demand.

On the basis of its applications, the global automotive steel market is categorized into the following segments:

  • Body-in-White
  • Drive Train
  • Suspension
  • Others

Body in white segments dominated the market in 2017 and is expected to continue to do so throughout the forecast period. Body-in-white (BIW) is a stage in the manufacturing of automobiles where the metal components of vehicles are welded together. Hood (frame and panel), floor and other panels, roof frame, tunnel, doors, and rear side panels are some of the metal components where steel penetration is high. Enabling the use of advanced high-strength steel in BIW saves money, reduces weight, and improves the aesthetics of the outer panels as well as the vehicle's lifetime. Moreover, the fuel economy standards laid down by original equipment manufacturers (OEMs) have further led to the demand for light-weight steels with higher strength, such as advanced high-strength steel in body-in-white applications. Currently, the rising promotion of budget cars owing to tax incentives on small cars is significantly encouraging the use of high-strength steel in vehicle bodies and parts owing to its lower cost, which in turn drives the market.

Steel offers a light-weight solution for vehicle suspension components such as suspension arms, torsion bars, springs, and linkages. Therefore, the suspension segment is expected to exhibit major growth potential during the forecast period. Over the forecast years, increasing use of high-carbon steel for the manufacture of helical springs for suspension systems so as to obtain high stiffness and light weight is expected to fuel market demand.

Based on geographical distribution, the global automotive steel market is segmented into the following categories:

  • North America
    • U.S.
    • Canada
  • Europe
    • Germany
    • Spain
    • France
    • UK
    • Rest of Europe
  • Asia Pacific
    • Japan
    • China
    • India
    • Rest of Asia Pacific
  • Latin America
    • Brazil
    • Mexico
    • rest of Latin America
  • Middle East and Africa
    • GCC
    • Rest of the Middle East and Africa

Asia-Pacific dominated the market in 2017 and is expected to maintain its dominance throughout the forecast period. Increasing launches of heavy and medium-duty vehicles by original equipment manufacturers (OEMs), investments in infrastructure, and rising disposable incomes are some factors spurring market growth. Additionally, low-interest rates on vehicle purchases, leading to increased consumer confidence as well as the need for commercial vehicles for transportation, are further driving the market in this region. Rising sales of low-priced or budget cars due to their low maintenance, enhanced life, and cost-effectiveness have diverted the attention of manufacturers in Asia-Pacific towards heavier investments in small cars, which enhance the use of steel. In addition to it, investment-boosting reforms such as "Make in India" in countries such as India led to an increase in FDI, boosting vehicle production and, in turn, contributing to wide steel consumption in the automotive industry. However, demand for steel is poised to improve in European and North American regions on account of reviving industrial production and better investment prospects in these regions. Latin America and the Middle East and Africa (MEA) are expected to show an average growth rate during the forecast period. Construction was the dominant sector in this region, and the production of steel in this region was based on demand from the construction sector. Therefore, the automotive industry in these regions is highly dependent on construction activities, such as in Brazil, as the production of long steel is based on the requirements of the construction industry. However, declining construction activities in this region are expected to hamper steel production as well as market growth in the coming years.

Frequently Asked Questions:

The market for Automotive Steel is expected to reach US$ XX Bn in 2026.

The Automotive Steel market is expected to see significant CAGR growth over the coming years,at 4.3%.

The report is forecasted from 2018-2026.

The base year of this report is 2017.

ArcelorMittal,Baosteel,Hesteel Group, JFE Steel Corporation,Nippon Steel are some of the major players in the global market.

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Published Date:  Jan 2018
Category:  Advanced Materials
Report ID:   58950
Report Format:   PDF
Pages:   120
Rating:    4.4 (12)
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