Automotive starter Motor Market Analysis

Automotive Starter Motor Market (Global, 2024)

Introduction

The starter market is in the midst of a major transformation as the automotive industry evolves with technological changes and consumer preferences. The demand for starters with increased efficiency, lower emissions and hybrid and electric vehicle capability is growing. The starters market is characterised by a wide range of products, for various vehicle types, including passenger cars, commercial vehicles and electric vehicles. As starters manufacturers strive to improve performance, reliability and sustainability, the market is becoming more dynamic, with leading companies investing in research and development to introduce new products. The growing trend towards automation and smart vehicle systems is expected to further influence the design and functionality of starters. This makes it important for the starters industry to stay abreast of market trends and consumer preferences.

PESTLE Analysis

Political

The auto industry is strongly influenced by government policies aimed at reducing CO2 emissions. In Europe, for example, the EU has set a target of reducing greenhouse gas emissions by at least 55 per cent by 2030 compared to the 1990 level. This is of direct concern to the auto industry and to the producers of starter motors. In the USA, the government has proposed a tax credit of up to $7,500 for the buyers of electric cars, thus encouraging the development of electric vehicles and thus the production of starter motors for such vehicles.

Economic

The global automobile industry is expected to be worth about $4.5 billion by 2024. The starter motor segment is a key part of that. The average price of starter motors varies from $50 to $200, depending on the type of vehicle and the technology used. Also, the industry employs over nine million people in the United States alone, indicating the importance of the starter motor to the national economy.

Social

Preferences are shifting towards more sustainable and efficient cars, and by 2024 about 60% of car buyers will opt for electric or hybrid vehicles. This is driving the demand for advanced starters compatible with this technology. In addition, the growing awareness of the environment is making consumers more demanding of car manufacturers. The latter are being forced to adopt greener production methods.

Technological

In 2024, a brushless starter is introduced, with higher efficiency and a longer life. It is equipped with a smart starter motor, which has IoT, enabling remote diagnosis and monitoring of its functioning. Approximately a quarter of the new vehicles will be equipped with these new starters, which is a sign of the industry's shift to innovation and enhanced performance.

Legal

Moreover, the regulatory framework is becoming more and more demanding. The National Highway Traffic Safety Administration (NHTSA) is introducing new regulations on the design of starters. By 2024, manufacturers must meet a new noise standard that requires a 30 percent reduction in the noise level of starters, which requires new R & D. Besides, the European ELV directive requires that 95 percent of the components of a car, including the starter, be reclaimed by 2025.

Environmental

In the meantime, the automobile industry is under pressure to reduce its environmental impact, for the International Energy Agency has calculated that transportation accounts for 24% of the world's carbon dioxide emissions. In 2024, starter manufacturers are working with sustainable materials and production methods, and an estimated 40 percent of the new starters are made from recycled materials. The goal is to reduce waste and to align with global goals for zero emissions by 2050.

Porter's Five Forces

Threat of New Entrants

The barriers to entry in the starter motor market are moderate, owing to the high investment required in the technology and the equipment. The leading players benefit from economies of scale and brand loyalty, which act as a barrier to new entrants. However, technological developments and the emergence of electric vehicles could create opportunities for new and more flexible players.

Bargaining Power of Suppliers

The bargaining power of suppliers in the starter motor market is relatively low. There are many suppliers of materials and components, which creates a competitive environment. Furthermore, the suppliers of the starter motors have diversified their supply chains, which reduces the dependence on one supplier and increases the negotiating power of the starter motors manufacturers.

Bargaining Power of Buyers

The bargaining power of the buyers in the starter motor market is considerable, because of the large number of choices and the ease of changing suppliers. The buyers are also becoming better informed and more demanding of quality and price, which puts increasing pressure on manufacturers to improve quality and reduce costs.

Threat of Substitutes

The threat of substitutes in the automobile starter market is moderate. In this market, the use of starters is very wide, but the growing use of electric cars and other starters could represent a threat. However, the transition to these substitutes is slow, and the starter is still a necessity in many internal combustion engines.

Competitive Rivalry

Competition is high in the starter market, with several established players competing for market share. This is reflected in the frequent product launches and the brisk pace of technological development. The competition for the best products is therefore fierce.

SWOT Analysis

Strengths

• High demand for starter motors due to increasing vehicle production.
• Technological advancements leading to more efficient and durable starter motors.
• Strong presence of established manufacturers with brand recognition.

Weaknesses

• High competition leading to price wars and reduced profit margins.
• Dependency on the automotive industry, which is cyclical and sensitive to economic fluctuations.
• Challenges in sourcing raw materials due to supply chain disruptions.

Opportunities

• Growth in electric vehicle (EV) market creating demand for specialized starter motors.
• Potential for expansion into emerging markets with rising automotive sales.
• Increased focus on sustainability and eco-friendly products can lead to innovation.

Threats

• Rapid technological changes may render existing products obsolete.
• Economic downturns affecting consumer spending on vehicles.
• Regulatory changes regarding emissions and fuel efficiency impacting starter motor designs.

Summary

The Automotive Starter Motors Market in 2024 is characterized by a strong demand, which is driven by the growth in vehicle production and technological advancements. However, the market faces the challenges of high competition and price sensitivity. Opportunities include the growing EV market and the emerging markets. Threats include the technological changes and the regulatory pressures. In order to take advantage of these opportunities and mitigate the threats, companies must focus on their strengths and overcome their weaknesses.