Market Trends of South Korea Automotive Parts Aluminium Die Casting Industry
This section covers the major market trends shaping the South Korea Automotive Parts Aluminium Die Casting Market according to our research experts:
Pressure Die Casting Captures the Market
Owing to the advantages offered by the process of pressure die casting over other casting methods, the players in the industry are investing in expanding their operations in the country for fulfilling the demand of aluminium parts for automotive in the country.
Using the pressure die casting technique, high volumes of components can be produced with high accuracy over other processes. Also, the method is cost-effective and less time consuming, and other advantages and the demand in the country is enabling the significant players in the country to invest heavily and expand their operations.
Vacuum die casting has also been profitable to the manufacturers. It has shown to produce high reliable and quality parts for the transmission parts. Transmission parts of the automobile has one of the most complex mechanical combination functions which is prone to difficult conditions.
Aluminium production has been on raise in South Korea increasing year on year. In 2018, South Korea produced 958,090 metric tons of aluminium. OEMs are taking advantage of this high availability of aluminium by using aluminium die casted parts in automobiles. South Korea is also one of the leading exporters of aluminium die casting parts to China. This market is expected to grow during the forecasted period as the rules and regulations are changing across the world which is favouring the use of aluminium die casting parts.
Decline in Passenger Car Production is restraining Growth
South Korea automotive industry has been an indicator for the economic growth of the country. South Korea automotive industry has an export-oriented economy, many cars produced domestically were sold overseas. Approximately 2.4 million passenger cars were exported in 2019 which has significantly fallen from 3 million exports in 2012. Struggling global economy and stagnant demand across the world play a role. The shutting down of American car manufacturer General Motors Korean subsidiary has had negative impact on the exports by hindering production.
South Korea's automotive exports are heavily influenced by global economy and environmental regulations. Recent changes in the regulations across the world has had very huge impact on sales till 2019 and recent COVID-19 economic crisis has further reduced exports.
With technological advancements South Korean manufacturers are expected to see raise in demand for car exports which intern will increase demand for aluminium die casting automotive materials as manufacturers are looking to reduce car weight in order to keep up with emission norms across the world. But the aluminium die casting industry is also facing threat from the newly emerging composites market as composites provide the same physical properties and are much lighter than aluminium castings. However, during the forecasted period automotive parts aluminium die casting market is expected to witness high competition and grow at a slow pace.
