Market Trends of Circuit Protection Components Industry
Automotive is Expected to Hold Significant Market Share
- The increase in hybrids and electric vehicles (EV-type cars) is rapidly reducing the environmental burden and increasing the number of ECUs (electronic control units), thereby leading to a more robust demand for electronic components whose miniaturization and further performance improvements have been rising. The growing market for these vehicles will offer further growth opportunities to circuit protection component manufacturers.
- In July 2022, a new set of European rules were introduced, requiring new vehicles to be equipped with a range of mandatory advanced driver-assist systems to improve road safety. The latest safety regulations will help to protect passengers, cyclists, and pedestrians across the EU, saving over 25,000 lives and avoiding at least 140,000 severe injuries by 2038.
- North America is one of the largest automotive hubs in the world. The region's economic growth has impacted the sale of passenger cars and commercial vehicles. Further, according to the US Department of Energy, in May 2024, the United States saw a surge in plug-in vehicle sales, with a total of 124,921 units sold. This figure comprised 98,797 Battery Electric Vehicles (BEVs) and 26,124 Plug-in Hybrid Electric Vehicles (PHEVs). Compared to May 2023, these sales marked a 3.2% increase. Notably, Plug-in Electric Vehicles (PEVs) accounted for 8.74% of all Light-Duty Vehicle (LDV) sales in the country for the month.
- Also, according to the China Association of Automobile Manufacturers, over 965,000 passenger automobiles and around 216,000 commercial vehicles were sold in China in April 2022; these numbers represent a 48% and a 42% decline, respectively, from the previous month. Such huge sales of vehicles will create an opportunity for the studied market to grow.
- Further, according to SIAM India, in 2023, India had produced 4.58 million passenger vehicles. The nation's automotive sector faced a downturn, attributed to both economic challenges and the reverberations of the COVID-19 pandemic, particularly in the financial years of 2020 and 2021.
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Asia-Pacific is Expected to Register Significant Growth
- In recent years, India has witnessed remarkable growth in terms of the demand for and consumption of electricity. Growing urbanization and industrialization rates are among the primary factors behind this growth.
- Furthermore, the demand for circuit protection components is also expected to grow across their major end-user industries, such as automotive, consumer electronics, energy, and power, as these sectors are witnessing an upward trend.
- Further, China is also witnessing growth in terms of the adoption of electric vehicles. Growing awareness and various government-led initiatives are driving the sales of electric vehicles in the country. For instance, according to the China Association of Automobile Manufacturers (CAAM), in August 2023, China sold a total of 846,000 new energy vehicles. Of these, 808,000 were passenger electric vehicles, with the remaining 39,000 designated for commercial use. Breaking down the passenger electric vehicle segment further, sales figures stood at 559,000 units for battery electric vehicles (BEVs) and 248,000 units for plug-in hybrid electric vehicles (PHEVs).
- The government is also taking a number of initiatives to promote the growth of the Chinese automotive industry. For instance, in September 2022, the State Taxation Administration (STA), the Ministry of Finance (MOF), and the Ministry of Industry and Information Technology (MIIT) jointly announced the continuation of tax exemptions on purchases of new energy vehicles. Hence, with EV sales expected to sustain a similar growth pattern, the demand for circuit protection components across the country's automotive industry is also expected to grow further during the forecast period.
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