Automotive Heat Exchanger Market Analysis North America, Europe, EMEA, APAC : US, Canada, China, Germany, UK - Size and Forecast 2023-2027

Automotive Heat Exchanger Market Forecast 2023-2027

The Automotive Heat Exchanger Market size is estimated to grow by USD 8.30 billion at a CAGR of 6.41% between 2022 and 2027. The market's growth hinges on key factors, notably the prevalent reliance on IC engines for mobility in emerging nations, escalating passenger car sales, and mounting governmental regulations mandating the adoption of efficient HVAC systems in vehicles. This confluence of factors underscores the importance of addressing environmental concerns and enhancing energy efficiency across the automotive sector. With a focus on meeting regulatory standards and consumer demands for sustainable transportation solutions, the market is poised for significant expansion, driven by advancements in vehicle technology and a growing emphasis on environmental sustainability in the automotive industry.

What will be the  Automotive Heat Exchanger Market Size During the Forecast Period?

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In the medium term, the production of vehicles is expected to drive the demand for traditional heat exchanger systems, especially with the rising adoption of hybrid and electric vehicles. However, inhibiting factors like volatility in the prices of raw materials prices and the complexity of designing advanced heat exchangers pose challenges. Despite this, there's a growing focus on enhancing vehicle dynamics and safety features through innovative heat transfer devices. Furthermore, in sectors such as process fluids in steam power plants and chemical processing plants, there's an increasing reliance on efficient heat exchangers to optimize operations. These trends reflect a broader shift towards large-scale manufacturing and sustainable supply chain activities to meet rising demand.

Market Dynamics and Customer Landscape

The market is experiencing a shift towards medium-term growth, driven by increased production of vehicles and rising adoption of innovative technologies like battery thermal management systems. While traditional heat exchanger manufacturers play a significant role, challenges such as volatility in raw material prices and the complexity of designing advanced exchangers hinder progress. However, government initiatives like the California ZEV program and efforts to enhance charging infrastructure are propelling the market forward. With a focus on reducing environmental pollution and meeting zero-emission standards, the demand for heat exchangers is rising across diverse applications in the automotive sector. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Drivers

The heavy dependence on IC engines for mobility in emerging countries is notably driving market growth. Emerging countries like India and China are witnessing an increase in the preference for mobility through roadways. In the commercial vehicle segment, there is hardly any vehicle that runs on battery or on alternate fuels. Hence, there is a high reliance on internal combustion (IC) engines for transportation.

One of the main reasons why road transport is preferred for mobility and the transportation of cargo is the limited availability of rail services. The lack of effective rail services for logistics is forcing freight companies to choose roadways as a reliable mode of transportation. Heavy-, medium-, and light-duty vehicles are used extensively for transporting cargo in China. In India, road transportation is the widely chosen means for container transport. Thus, automobiles operating on IC engines play a key role in providing easy mobility and transporting cargo, which will drive the demand for automotive heat exchangers. This, in turn, augments the growth of the market during the forecast period.

Significant Market Trends

An increase in the popularity of brazed copper heat exchangers is the primary trend in the market. Aluminum heat exchangers are being replaced by brazed copper heat exchangers in heavy vehicles. Brazed copper heat exchangers have several advantages over conventional ones. The CuproBraze process is simpler and inexpensive than the manufacturing process of aluminum heat exchangers as it has fewer production steps, higher throughput rates, and lower scrap rates.

Other benefits include lower weight and longer life, superior thermal conductivity, and better resistance to corrosion, copper is virtually 100% recyclable. The brazing process gives stronger joints to the copper-brass heat exchangers than the soldered copper-brass heat exchangers or brazed aluminum heat exchangers. Also, brazed copper heat exchangers have thinner fin and tube materials, which further reduce the weight. As a result, brazed copper heat exchangers are preferred over soldered copper-brass or brazed aluminum radiators.

Major Market Challenges

Gradual increase in annual wages leading to declining profit margins is the major challenge impeding market growth. In the automotive industry value chain, OEMs have been taking up the liability for most of the price pressure and warranty costs from the demand in the past. However, the situation has changed in the past five years as OEMs have started pushing the liabilities to tier-1 suppliers, who, in turn, have pushed them to component manufacturers. This has led to cost optimization across the industry to remain profitable. 

However, owing to the rising labor costs, these countries are gradually losing their cost advantage. For instance, in China, as the population has become more affluent and moved up the learning curve, there was an increase in the cost of employment.  Similarly, experts from the Hong Kong Printed Circuits Association observed a labor movement from one manufacturer to another for a mere increase in income. This led to a price war among the manufacturers to retain talent in the company, which further increased the labor cost. This situation increased the overall cost of production. Hence, the gradual increase in annual wages will lead to a decline in the profit margins, which will adversely affect the market.

Market Customer Landscape

The Market forecasting  includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.

 Market Customer Landscape

Who are the Major Automotive Heat Exchanger Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Hisaka Works Ltd. - The company offers automotive heat exchangers, serving the automotive and transportation sectors as well as a wide variety of heavy industrial markets. Through this segment, the company offers heat exchanger manufacturing.

The report also includes detailed analyses of the competitive landscape of the market and information about 15 market Companies, including:

• Conflux Technology Pty Ltd.
• Constellium SE
• Delphi Technologies Plc
• Granges
• Haugg Kuhlerfabrik GmbH
• HongDao Automotive Parts Co. Ltd.
• MAHLE GmbH
• Modine Manufacturing Co.
• Nissens Group
• Senior Plc
• Southwest Radiator Inc.
• Spectra Premium Industries Inc.
• Valeo SA
• Vibrant Power Inc.
• Vikas Group

Qualitative and quantitative analysis of Companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize Companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize Companies as dominant, leading, strong, tentative, and weak.

Market Segmentation

This market research report extensively covers market segmentation by application (passenger cars, ICVs, and M and HCVs), type (plate bar, tube fin, and others), and geography (APAC, North America, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. The market is undergoing significant transformations due to various factors such as supply chain activities, large-scale manufacturing, and restrictions on travel affecting demand dynamics. While declining sales pose challenges, the market is witnessing an uptick driven by the production of light vehicles and rising demand for passenger vehicles. The shift towards engine downsizing and lightweight automotive materials further propels growth, alongside the increasing adoption of hybrid and electric vehicles. However, challenges persist, including volatility in raw material prices and the complexity of designing advanced heat exchangers. With governments implementing zero-emission standards and incentives for vehicle manufacturing, the market is poised for expansion, particularly in emerging and developing countries.

By Application

The market share growth of the passenger cars segment will be significant during the forecast period. OEMs are equipping their passenger cars with brazed copper heat exchangers that have a longer life span and can last for ten years, which will reduce the replacement cost. Such heat exchangers are about 35% lower in weight compared to traditional heat exchangers as their fins and tubes are manufactured with fewer materials. Hence, the growth in the passenger cars segment will fuel the market growth during the forecast period.

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The passenger cars segment was valued at USD 17.00 billion in 2017 and continued to grow until 2021. Heating, ventilation, and air-conditioning (HVAC) is a technology used to maintain the internal temperature of the cabin of the vehicle. Due to the augmented demand for comfort in vehicles, these compressors are increasingly being used in mass-selling cars as well as commercial vehicles. HVAC requires a heat exchanger to dissipate the heat. 

Regional Analysis

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APAC is estimated to contribute 54% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

The increasing disposable incomes and the launch of new car models by OEMs are the main factors driving the market. Moreover, the perception of achieving a higher social status by owning a car is driving the market for passenger cars in China and India despite the increasing rates of traffic congestion, government regulations for owning passenger cars, and rising levels of vehicular pollution. APAC has the maximum number of potential first-time buyers of passenger cars, which is also increasing the number of passenger car sales. This will ultimately fuel the growth of the market in APAC.

Market Analyst Overview

The traditional heat exchanger systems manufacturers face challenges due to volatility in raw material prices and the complexity of designing advanced and lightweight heat exchangers. Despite this, the automotive industry is witnessing a shift towards hybrid and electric vehicles, driven by factors like ever-increasing demand and rising adoption. Governments worldwide, such as the Norwegian Parliament and the Government of India, are implementing zero-emission standards and offering incentives like the California ZEV program to boost the production of battery electric vehicles. However, restrictions on travel and declining sales pose temporary setbacks. Nevertheless, the market anticipates growth with the rising demand for light vehicles and passenger vehicles, especially in emerging markets.

The thermal systems sector is undergoing significant transformations, with innovations like the Smart Heat Pump gaining traction. Automakers are increasingly focusing on integrating advanced valves and pumps to enhance vehicle dynamics and safety features. Furthermore, the industry is witnessing a surge in construction type heat exchangers, particularly in building heat and air conditioning systems, transportation power systems, and refrigeration units. Despite restraints such as the high cost of luxurious electric vehicles and fuel-efficient vehicles, the market is propelled by the growing popularity of low-emission vehicles and the integration of sensors, radars, and cameras for enhanced safety and convenience in connected vehicles. Additionally, the advent of AI, Big Data, and IoT is revolutionizing vehicle connectivity and infotainment systems, paving the way for a greener, smarter automotive future.

Segment Overview

The market research and growth report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. 

• Application Outlook
  • Passenger cars
  • LCVs
  • M and HCVs

• Type Outlook
  • Plate bar
  • Tube fin
  • Others

• Region Outlook
  • APAC
    • China
    • India
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • South America
    • Brazil
    • Argentina
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Scope
Report Coverage	Details
Page number	172
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 6.41%
Market growth 2023-2027	USD 8.30 billion
Market structure	Fragmented
YoY growth 2022-2023(%)	5.88
Regional analysis	APAC, North America, Europe, South America, and Middle East and Africa
Performing market contribution	APAC at 54%
Key countries	US, China, Japan, India, and Germany
Competitive landscape	Leading Companies , Market Positioning of Companies , Competitive Strategies, and Industry Risks
Key companies profiled	Alfa Laval Corporate AB, API Heat Transfer Inc., Be Cool Radiators, Clizen Inc., Conflux Technology Pty Ltd., Constellium SE, Delphi Technologies Plc, Granges, Haugg Kuhlerfabrik GmbH, Hisaka Works Ltd., HongDao Automotive Parts Co. Ltd., MAHLE GmbH, Modine Manufacturing Co., Nissens Group, Senior Plc, Southwest Radiator Inc., Spectra Premium Industries Inc., Valeo SA, Vibrant Power Inc., and Vikas Group
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period.
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the key data covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2027
• Precise estimation of the market size and its contribution to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the industry across APAC, North America, Europe, South America, and Middle East and Africa
• Thorough analysis of the market’s competitive landscape and detailed information about Companies
• Comprehensive analysis of factors that will challenge the growth ofmarket Companies

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