Automotive Test Equipment Market

Rising demand for electric vehicles propels market growth.

The rising demand for electric vehicles is driving up the market CAGR for automotive test equipment. As electric vehicles become more popular around the world, automakers are investing in new technology and testing equipment to improve their performance and efficiency. Automotive testing equipment is required for the development and testing of electric vehicle components like as batteries, motors, and power electronics. These components necessitate the use of specialist testing equipment capable of measuring power output, efficiency, and durability. The demand for this specialist testing equipment is projected to increase as manufacturers continue to create new electric car models.

In addition, automotive test equipment is employed in the development and testing of classic gasoline-powered automobiles. As automakers continue to improve these vehicles' performance and economy, they will need more complex testing equipment to verify that they fulfill new emissions and safety criteria.

The growing emphasis on vehicle safety is another driver of market expansion for automotive test equipment. Governments throughout the world are enacting stricter vehicle safety laws, and automakers are investing in new testing technology to ensure that their vehicles meet these requirements. As an example, Crash testing is an important component of car safety testing. Automobile manufacturers utilize sophisticated testing equipment to simulate various types of collisions and assess the impact on the vehicle and occupants. This testing is critical for enhancing vehicle safety and lowering the risk of injury or death in the case of an accident.

Other safety elements, including as airbags, seat belts, and electronic stability control systems, are also tested using vehicle test equipment. These features are growing increasingly advanced and complex, necessitating the use of specialist testing equipment to ensure that they function effectively.

The increasing complication of automotive electronics. Modern vehicles include a variety of electronic systems, such as infotainment, navigation, driving aid, and safety systems. These systems necessitate specialized testing equipment to verify correct operation and compliance with safety and performance criteria. Electronic systems and components such as sensors, controllers, and wiring harnesses are tested using automotive test equipment. This testing is critical for discovering and diagnosing faults with these systems, as well as ensuring that they are operationally sound and meet regulatory requirements.

The demand for specialist testing equipment is likely to rise as vehicles become more complicated and incorporate more electrical systems. To ensure that their electrical systems are trustworthy and operate effectively in all situations, automakers want specialized testing equipment that can replicate various driving conditions and environmental elements.

Stringent regulatory requirements are a key driver in the Global Automotive Test Equipment Market Industry. Governments worldwide are implementing rigorous safety and environmental standards that automotive manufacturers must adhere to. This compliance necessitates the use of specialized test equipment to ensure vehicles meet these regulations. For instance, emissions testing equipment is critical for manufacturers aiming to comply with increasingly strict environmental laws. As regulations evolve, the demand for reliable and precise testing equipment is likely to rise, further propelling market growth. By 2035, the market is projected to reach 4.98 USD Billion, underscoring the importance of compliance in driving equipment demand.

Safety remains a paramount concern in the automotive industry, driving the demand for advanced testing equipment within the Global Automotive Test Equipment Market Industry. Manufacturers are increasingly prioritizing safety features, necessitating comprehensive testing to ensure vehicle reliability and performance. This includes crash testing equipment and systems for evaluating driver-assistance technologies. As consumer awareness regarding safety rises, automotive companies are compelled to invest in sophisticated testing solutions to maintain competitive advantage. The emphasis on safety is likely to sustain market growth, as manufacturers seek to meet consumer expectations and regulatory standards.

The Global Automotive Test Equipment Market Industry is experiencing rapid technological advancements, particularly in the areas of electric and autonomous vehicles. Innovations such as advanced driver-assistance systems (ADAS) and electric powertrains necessitate sophisticated testing equipment. For instance, the integration of artificial intelligence in testing processes enhances accuracy and efficiency. As the automotive sector evolves, the demand for cutting-edge test equipment increases, contributing to the market's projected growth. The market is expected to reach 3.43 USD Billion in 2024, reflecting the industry's need for advanced testing solutions to meet stringent safety and performance standards.

The surge in electric vehicle (EV) adoption significantly impacts the Global Automotive Test Equipment Market Industry. As consumers increasingly favor environmentally friendly transportation options, manufacturers are compelled to invest in testing equipment tailored for EVs. This includes battery testing systems and electric powertrain diagnostics. The transition to electric mobility is not merely a trend; it is a fundamental shift in the automotive landscape. Consequently, the demand for specialized test equipment is expected to grow, aligning with the projected compound annual growth rate of 3.45% from 2025 to 2035. This growth trajectory indicates a robust market response to the evolving automotive ecosystem.

Emerging economies are witnessing a notable expansion in the Global Automotive Test Equipment Market Industry. As countries like India and Brazil experience economic growth, the automotive sector is rapidly evolving, leading to increased demand for testing equipment. These markets are characterized by a growing middle class and rising vehicle ownership, prompting manufacturers to invest in quality assurance and testing solutions. The influx of foreign automotive companies into these regions further stimulates the market. As these economies develop, the demand for reliable and efficient automotive test equipment is expected to rise, contributing to the overall growth of the industry.

By region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. North America is the most important market for automotive test equipment, accounting for a large portion of the global market. There are several major automakers and automotive testing companies in the region, and there is a considerable emphasis on vehicle safety and emissions laws. This has resulted in a significant need for automobile test equipment, both classic and modern.

Further, the major countries studied in the market report are The US, Canada, German, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure2: Global Automotive Test Equipment Market Share By Region 2022 (Usd Billion)

Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

Europe Automotive Test Equipment Market accounts for the second-largest market share because of the acceptance of safety certification. Further, the German Automotive Test Equipment Market held the largest market share, and the UK Automotive Test Equipment Market was the fastest growing market in the European region

The Asia-Pacific Automotive Test Equipment Market is expected to grow at the fastest CAGR from 2023 to 2032. This is due to low production costs and the availability of inexpensive labour. Moreover, China’s Automotive Test Equipment Market held the largest market share, and the Indian Automotive Test Equipment Market was the fastest growing market in the Asia-Pacific region.

Leading market players are investing heavily in research and development in order to expand their product lines, which will help the Automotive Test Equipment Market, grow even more. Market participants are also undertaking a variety of strategic activities to expand their global footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, Automotive Test Equipmentindustry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics used by manufacturers in the global Automotive Test Equipment industry to benefit clients and increase the market sector. In recent years, the Automotive Test Equipment industry has offered some of the most significant advantages to medicine. Major players in the Automotive Test Equipment Market, including ABB Ltd (Switzerland), Delphi Automotive PLC (UK), Actia S.A. (France), Advantest Corp (Japan), Horiba Ltd. (Japan), Softing AG (Germany), Teradyne Inc. (US), and Siemens (Germany). and others, are attempting to increase market demand by investing in research and development operations.

Siemens AG is a global technological firm based in Germany. Its operations include process and manufacturing automation and digitalization, intelligent infrastructure for buildings and distributed energy systems, rail transportation solutions, health technologies and digital healthcare services. Siemens is Europe's largest industrial manufacturer and the world leader in industrial automation and industrial software. In 2019, Siemens AG has announced the purchase of TASS International, a Dutch business specializing in autonomous car testing. Siemens' offering in the field of autonomous vehicle testing will be expanded as a result of the acquisition.

Horiba, Ltd. is a Japanese maker of precision measurement and analysis devices. They manufacture equipment for measuring and analyzing car exhaust gas (80% of the global market),[4] as well as environmental, medicinal, and scientific uses. Horiba is one of the world's top 25 analytical and life sciences instruments firms. For more than 50 years, the company has been active in measurement technologies. It is divided into five sectors: automobile testing systems (36% activity), environmental (11% activity), medical (17%), semiconductor (19%), and scientific subjects (17%).

Today, the group, led by Atsushi Horiba, employs 5,965 people worldwide and generates $1,294 million in revenue. January 2020, Horiba Ltd. purchased FuelCon AG, a German firm specializing in battery and fuel cell testing. Horiba's offering in the field of electric vehicle testing has been expanded as a result of the acquisition.