The China Automotive Heat Exchanger Market is expected to register a CAGR of about 8.73 % during the forecast period (2020 - 2025).
- An automotive heat exchanger is used to transfer heat between two mediums at different temperatures that are in thermal contact with each other. For instance, in an internal combustion engine, the engine coolant flows in a circular motion through the radiator coils, and air flows past these coils to cool the engine. By the end of 2014, the automotive segment had acquired more than a 25% share in the global heat exchanger market.
- China is growing at a rapid pace in the automotive heat exchanger market. The country has increased its market share significantly since the early 2000s, and today holds the highest market share of more than 50% in automotive heat exchangers in Asia. Demand for passenger cars and LCVs are expected to grow over the forecast period, leading to high demand for automotive heat exchanger units in China. The country is also home to more than 500 heat exchanger manufacturers.
- The increasing demand for a reduction in the weight of automobiles has made the OEM's replace the heavier materials such as iron and steel with lighter materials such as plastics and aluminium. This trend is also followed in the automotive heat exchanger market. Also, previous designs and structures of the heat exchanger have caused corrosion, decomposition, settlement of sludge, and dust particles have led to fouling, which results in reduced heat transfer and restricted throughput, and this leads to higher fuel consumption.
Key Market Trends
Growing Electric Vehicle Sales Boosting the Demand
The sales and the production of the electric vehicles are further expected to witness a phenomenal growth rate, with many countries trying to achieve the zero-emission standards. Many economies around the world are aiming to eliminate pollutants from the vehicles by completely removing fossil fuel vehicles from the roads. Developing countries like China have also decided to fight the environmental pollution problems by increasing the number of electric cars in the countries.
To make this a possibility, the Chinese government is offering many incentives to the customers opting for electric-powered vehicles. The customers of electric cars are expected to get additional benefits, such as price subsidies, free parking, and tax exemptions, etc.. In contrast, the buyers of regular vehicles are being levied heavy taxes. With further incentives from the regulating authorities and the availability of better electric cars, the sales are further expected to grow up in the country.
Stringent emission norms in the region have enabled it for a technological breakthrough in the production of fuel-efficient automotive heat exchangers. One such popular emerging trend apparent in the market is the decline in the engine size of the vehicles, leading to the increased demand for two and three-cylinder engines. The sales of four-cylinder engines are expected to fall significantly, with the increased stringency of emission norms (since vehicle weight is directly proportional to the emission released). The increasing demand for small-sized automobiles will rise the demand for turbochargers, which would again propel the demand for heat exchangers, leading to the growth of the country's automotive heat exchanger market.
Demand for Passenger Cars and LCV Drive the Demand
Demand for passenger cars and LCVs in China is expected to grow during the forecast period, leading to a high demand for automotive heat exchanger units in China. The country is home to more than 500 heat exchanger manufacturers, with a massive presence of regional players. The increased penetration of passenger vehicles over the last three years in the region has driven the growth of the automotive aftermarket. It has helped significantly in the growth of the Asia-Pacific automotive heat exchanger market.
The overall market for heat exchangers in China is witnessing a high industrial growth rate, primarily due to an ever-increasing demand for heat exchangers because of their diverse applications. The need for automotive heat exchangers depends on several factors, such as the production and demand for automobiles and the number of vehicles on the road. In the emerging and developing nations such as China, the need for automotive heat exchangers is driven by the production of new cars. Also, the automotive heat exchanger manufacturers in the China region have started to invest heavily in the lightweight automotive material (such as aluminium), which is expected to significantly enhance the demand for automotive heat exchangers in the region.
Most of the automobile manufacturers (OEMs) in China are working on the use of aluminium as a lightweight material in component production. Aluminium and plastic are also less expensive than iron and steel, making them useful materials. The revisions in the emission standards are expected to increase the use of heat exchangers. Also, fouling mitigation mechanisms, when devised in an automotive heat exchanger, further add to the cost of manufacturing automotive heat exchangers. Although managing costs while meeting the increased product complexity is a significant challenge for automotive heat exchanger vendors.
The China Automotive Heat Exchanger Market is fragmented with major players such as DENSO Corporation, Hanon System, Jiangsu Jiahe, Ningbo Lurun Cooler, and Pierburg China. To have the edge over its competitors, the major ADAS companies are making joint-ventures, partnerships with car manufacturing companies to launch newer products.
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