Electric Power Steering System Market Analysis

Electric Power Steering System (Global, 2024)

Introduction

The electric power steering system market is growing, as automobile manufacturers are increasingly focused on vehicle performance, safety and fuel efficiency. The demand for advanced driver assistance systems is growing and electric vehicles are gaining acceptance. As a result, EPS is becoming the norm for modern vehicles. EPS suppliers are responding to the growing demand for more responsive and intuitive driving. Also, as a result of the continuous advancements in sensors and the integration of EPS and other systems, the EPS is becoming an increasingly important component in the development of fully automatic and self-driving cars. These factors are creating a dynamic market environment, in which the players must master the challenges and seize the opportunities in order to remain competitive.

PESTLE Analysis

Political

In 2024, the government's support for electric vehicles in various regions will increase, which will directly affect the development of the electric power steering system market. For example, the European Union has set a goal of reducing CO2 emissions by at least 55% by 2030, and the corresponding technology, including the electric power steering system, will be adopted. The United States has set aside about $7.5 billion to build a charging network for electric vehicles, which indirectly promotes the development of the electric power steering system with the development of electric vehicles.

Economic

The global car industry is moving toward electrification. By 2024, it is expected that one-fifth of new cars sold will be electric. This trend is supported by a projected rise in spending on electric vehicles, which is expected to reach $145 billion in 2024. The electric power steering market is expected to grow, as these systems are essential to the performance and efficiency of electric vehicles.

Social

Consumers are turning towards vehicles that are more sustainable and technologically advanced. In 2024, studies show that over seventy per cent of consumers are willing to pay a premium for electric vehicles with high-tech features, such as the latest steering systems. This trend is a consequence of a growing awareness of the environment and a desire for a more enjoyable driving experience.

Technological

Electric power steering is advancing rapidly, and steer-by-wire is gaining ground. In 2024, it is estimated that 15% of new vehicles will have this steering system, which is lighter and more responsive than the conventional one. Artificial intelligence will further improve the safety and performance of cars, making these systems more attractive to manufacturers and consumers.

Legal

The regulatory framework for the emissions and safety of cars is becoming stricter. In the United States, for example, the National Highway Traffic Safety Administration (NHTSA) is expected to introduce a new rule in 2024 that requires all new cars to meet a certain safety standard, including the availability of advanced steering systems. These rules will lead to the introduction of electric power steering systems, which often meet or exceed the regulatory requirements.

Environmental

There is an increasing demand for the environment to be taken into consideration in the development of new automobile technology. Electric power steering has been recognized as a means of reducing the energy consumed by a car. In 2024, it is estimated that electric power steering can improve the fuel economy of a car by as much as 10 percent over the energy efficiency of a car with a hydraulic power steering system. In addition, the lower energy consumption means lower carbon dioxide emissions. The demand for such environmentally friendly automobile technology as electric power steering is expected to rise.

Porter's Five Forces

Threat of New Entrants

The electric power steering market has medium barriers to entry due to the significant investment in technology and production capacity. The market leaders benefit from economies of scale and brand loyalty, which hinders the entry of new players. However, technological advances and the increasing demand for electric vehicles may stimulate new entrants to enter the market.

Bargaining Power of Suppliers

The bargaining power of suppliers on the market for electric power steering systems is relatively low. There are many suppliers of components and materials, which leads to a highly competitive market. Moreover, many car manufacturers can easily change suppliers at relatively low cost, which further reduces the bargaining power of suppliers.

Bargaining Power of Buyers

High—The buyers of electric power steering systems have high bargaining power because of the availability of multiple choices and the increasing demand for advanced steering systems. They can therefore negotiate more effectively with suppliers.

Threat of Substitutes

The threat of substitutes for electric power steering is moderate. While there are still many hydraulic power steerings, the increasing trend of electric vehicles and the advantages of electric power steering, such as better fuel economy and easier driving, are expected to make it less likely that substitutes will have a significant impact on the market in the near future.

Competitive Rivalry

Competition is intense in the electric power steering market, with several major players competing for market share. The rapid technological development and innovation in electric vehicles intensify competition, with the companies seeking to differentiate their products and win over consumers.

SWOT Analysis

Strengths

• Enhanced fuel efficiency due to reduced weight compared to traditional hydraulic systems.
• Improved vehicle handling and stability through precise steering control.
• Integration with advanced driver-assistance systems (ADAS) for better safety features.
• Lower maintenance costs as electric systems have fewer moving parts.
• Growing consumer preference for electric vehicles driving demand.

Weaknesses

• Higher initial costs compared to conventional steering systems.
• Dependence on electrical systems, which may lead to failures in case of electrical issues.
• Limited awareness and understanding among consumers regarding benefits.
• Potential for software-related issues affecting performance.
• Challenges in retrofitting existing vehicles with electric power steering.

Opportunities

• Rising demand for electric and hybrid vehicles boosting market growth.
• Technological advancements in battery and motor efficiency enhancing system performance.
• Government regulations promoting fuel efficiency and emissions reduction.
• Expansion into emerging markets with increasing automotive production.
• Collaboration with tech companies for smart steering solutions.

Threats

• Intense competition from traditional hydraulic steering systems.
• Economic downturns affecting automotive sales and investments.
• Supply chain disruptions impacting component availability.
• Rapid technological changes requiring continuous innovation.
• Potential regulatory changes affecting manufacturing processes.

Summary

ELECTRIC POWER STEERING SYSTEM MARKET BY TYPE 2024 has a few advantages like better fuel efficiency and better handling of the car, which are in line with the growing customer preference for electric vehicles. The main challenges to this market are the initial high cost and the potential for problems with the software. Opportunities include the growing demand for electric vehicles and the technological advances, while competition and economic fluctuations are the main threats. Companies must focus on innovation and collaboration to be successful in this market.