Automotive transmission market is anticipated to grow at a CAGR of 16.4% during the forecast period (2024-2031). The growing adoption of electrification and hybridization, dual-clutch transmissions (DCT), and advanced manual transmissions with improving autonomous driving and automated transmissions are key factors supporting the market growth globally. The increasing demand for smart transmissions and connectivity with efficiency improvements also drives the market. 

Market Dynamics

Growing use of automatic transmissions and the development of hybrid drives

The growing number of electric and hybrid vehicles, along with the ease of combining automatic transmissions with safety features like autonomous emergency braking, are responsible for the increase in hybrid vehicles. Further, increasing consumer demand for enhanced driving experience, and the growing popularity of electric vehicles are expected to drive the market growth. The shift towards electric vehicles is particularly significant as they usually come equipped with automatic transmissions, boosting the demand for automatic transmission gears.

Increasing adoption of lightweight transmissions to increase overall vehicle efficiency 

Transmission technology continues to improve owing to growing customer demands for convenience and increased demand for fuel-efficient cars. Specialized transmissions, such as single-speed transmissions in Battery Electric Vehicles (BEVs) and continuously variable transmissions (CVTs) in hybrid vehicles, are needed to enhance efficiency and performance in the growing market for electric and hybrid vehicles.

Market Segmentation

Our in-depth analysis of the global automotive transmission market includes the following segments by transmission type, fuel type, and vehicle type:

• Based on transmission type, the market is sub-segmented into manual and automatic.

• Based on fuel type, the market is sub-segmented into gasoline, diesel and alternate fuel.

• Based on vehicle type, the market is sub-segmented into passenger cars, light commercial vehicles (LCVs) and heavy commercial vehicles (HCVs).

Manual is Projected to Emerge as the Largest Segment

Based on the transmission type, the global automotive transmission market is sub-segmented into manual and automatic. Among these, the manual sub-segment is expected to hold the largest share of the market. The primary factor supporting the segment's growth includes the growing adoption of five and six-speed manual transmissions, enhancing acceleration and fuel economy. The manual transmission involves the driver manually shifting gears using a clutch pedal and gear stick. This type provides a direct connection between the driver and the vehicle, offering more control over the gears' engagement.

Light Commercial Vehicles (LCVs) Sub-segment to Hold a Considerable Market Share

The light commercial vehicles (LCVS) segment has undergone advancements in transmission technology, resulting in improved comfort, driving enjoyment, and fuel efficiency. These advances have shifted from 4-speed automatic transmissions to 8-speed and 9-speed automatic transmissions. For instance, in May 2023, Dana introduced Spicer Electrified™ e-Transmissions for Commercial Vehicles. The company announced an expansion of its Spicer Electrified™ e-Powertrain offerings to include a family of e-Transmissions for a wide variety of medium-duty electric-vehicle applications.

Regional Outlook

The global automotive transmission market is further segmented based on geography including North America (the US, and Canada), Europe (UK, Italy, Spain, Germany, France, and the Rest of Europe), Asia-Pacific (India, China, Japan, South Korea, and Rest of Asia), and the Rest of the World (the Middle East & Africa, and Latin America). 

Increasing advancements in automotive transmission manufacturing in North America

• According to the International Trade Administration (ITA), in 2020, US light vehicle sales were 14.5 million units. Overall, US is the global second-largest market for vehicle sales and production.

• Increasing use of electrified gearboxes as a result of the increasing number of hybrid cars and their advantages in terms of emissions and fuel economy.

Global Automotive Transmission Market Growth by Region 2024-2031

Asia Pacific Holds Major Market Share

Among all the regions, Asia-Pacific holds a significant share owing to the presence of an enormous number of providers offering automotive transmission. Increasing automotive transmission, especially in countries like China, India, Japan, and South Korea, drives the growth of the market.  With the rise of hybrid and electric vehicles, Market players employ a single-speed transmission in electric vehicles, while others incorporate multi-speed transmissions to optimize efficiency and performance using Dual-Clutch Transmissions (DCTs). For instance, in December 2023, Zhejiang Dafa Gear Co., Ltd. introduced Dual-Clutch Transmissions (DCTs) combining the efficiency of manual transmissions with the convenience of automatics. They feature two separate clutches for odd and even gears, enabling lightning-fast gear changes and improved fuel efficiency.

Asia Motor Vehicle Production by Country in 2022

Source: International Organization of Motor Vehicle Manufacturers

Market Players Outlook

*Note: Major Players Sorted in No Particular Order.

The major companies serving the global automotive transmission market include AISIN CORP., BorgWarner Inc., Eaton Corp., Magna International Inc., ZF Friedrichshafen AG, among others. The market players are increasingly focusing on business expansion and product development by applying strategies such as collaborations, mergers, and acquisitions to stay competitive in the market. For instance,

• In January 2024, Allison Transmission Inc. manufacturer of medium- and heavy-duty fully automatic transmissions for commercial and defence vehicles, received an $83.3 million contract to provide upgraded and new X1100 transmissions supporting Abrams Main Battle Tank variants used by the U.S. Army and Foreign Military Sales customers.

• In December 2021, Magna International Inc. enabled global automakers to electrify their vehicle platforms with a full range of hybrid and fully electric powertrain solutions. The company has today confirmed that it has received a Hybrid Dual-Clutch Transmission (HDT) award from Mercedes-Benz for next-generation compact and mid-size vehicles, further demonstrating Magna’s continuing transformation in the electrification of mobility.

• In September 2021, Aisin Europe and Stellantis partnered for automatic gearbox repair. The service currently applies to four (6-speed) automatic gearbox models, AT6 and AM6 , which equip Stellantis vehicles.

The Report Covers

• Market value data analysis of 2023 and forecast to 2031.
• Annualized market revenues ($ million) for each market segment.
• Country-wise analysis of major geographical regions.
• Key companies operating in the global automotive transmission market. Based on the availability of data, information related to new product launches, and relevant news is also available in the report.
• Analysis of business strategies by identifying the key market segments positioned for strong growth in the future.
• Analysis of market-entry and market expansion strategies.
• Competitive strategies by identifying ‘who-stands-where’ in the market.