May 2024
Transmission Fluid Market (By Product: Manual Transmission Fluids, Automatic Transmission Fluids, Dual Clutch Transmission Fluids, Continuously Variable Transmission Fluids; By Application: Off-Road Vehicles, Automotive) - Global Industry Analysis, Size, Share, Growth, Trends, Regional Outlook, and Forecast 2024-2033
The global transmission fluid market size was USD 9.18 billion in 2023, estimated at USD 9.53 billion in 2024 and is expected to reach around USD 13.38 billion by 2033, expanding at a CAGR of 3.84% from 2024 to 2033. The rising demand for enhanced performance of vehicle transmission systems drives the market's growth.
The Asia Pacific transmission fluid market was valued at US$ 5.14 billion in 2023 and is expected to be worth around US$ 7.56 billion by the end of 2033, at a CAGR of 3.93% from 2024 to 2033.
Asia Pacific led the transmission fluid market with the largest market share in 2023. The growth of the market in the region is increasing owing to the rapidly evolving population and industrialization, both of which require a higher demand for personal and commercial vehicles for their transportation. The increasing demand for the smooth operation of vehicles in the personal and commercial sectors is driving the demand for transmission fluids, which enhances the overall performance of the vehicles and gives them a longer life cycle. The rising industrialization, such as construction, logistics, and supply chain industries, in developing economies like India, China, and Japan are driving the demand for off-road heavy-duty vehicles, which also contribute to the increasing demand for the transmission fluid market across the region.
North America is expected to witness the fastest growth during the forecast period. The growth of the market in the region is rising due to the rising number of personal vehicles owned by the people of developed countries like the United States and Canada, which is driving the demand for transmission fluid for the increasing overall performance of the vehicles. The rising availability of the major market players in the regional countries and the rapid expansion of electric vehicles are further propelling the growth of the transmission fluid market in the region.
Transmission fluid is one of the major factors of the automobile; it plays a major role in the operations of the vehicle's transmission system. Transmission fluid acts as both the coolant and lubricant, keeping all the moving parts running smoothly and preventing overheating. It reduces the friction between the various components inside the vehicle’s transmission system. It decreases heat in the transmission system and ensures the higher temperature does not cause any damage to the vehicles. Transmission fluid provides the hydraulic pressure inside the system that offers a smooth gear shift. It provides the power transfer from the engine to the wheel by offering resistance against stalling or slipping. The automatic transmission system vehicle requires the ATF (automatic transmission fluid), while the manual transmission vehicles require either ATF or manual gearbox oil. The rising demand for personal and commercial use in the automobile industry is driving the growth of the transmission fluid market.
Report Coverage | Details |
Market Size by 2033 | USD 13.38 Billion |
Market Size in 2023 | USD 9.18 Billion |
Market Size in 2024 | USD 9.53 Billion |
Market Growth Rate from 2024 to 2033 | CAGR of 3.84% |
Largest Market | Asia Pacific |
Base Year | 2023 |
Forecast Period | 2024 to 2033 |
Segments Covered | Product, Application, and Regions |
Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Rising demand for the automobile industry
The growing population globally is driving the demand for passenger and commercial vehicles for personal travel and business transportation. The major developing and developed economies depend on the transport industry. Vehicles are an essential part of human life for personal as well as commercial prospects. The rising demand for heavy-duty and off-road vehicles by the construction industry, logistics, and supply chain industry for moving goods from one place to another. The construction industry is one of the largest consumers of off-road vehicles for moving construction materials from one place to another. Additionally, the rising trend of having one's own vehicle in the population due to the elevated lifestyle and needs due to the rising disposable income and surging spending on lifestyle are boosting the sales of personal vehicles. Thus, all these factors are contributing to the expansion of the transmission fluid market.
Fluctuating raw material
The fluctuating prices of crude oil have a significant impact on the transmission fluid market. Since crude oil is a key ingredient in the production of transmission fluid, changes in its price directly influence the overall production costs. When crude oil prices are high, the cost of manufacturing transmission fluid increases, leading to higher prices for consumers. Conversely, when crude oil prices are low, there may be downward pressure on transmission fluid prices. This volatility makes it challenging for manufacturers to plan and price their products consistently, and it creates uncertainty for both producers and consumers in the transmission fluid market.
The rising consumption of EVs and hybrid vehicles
The rising demand for electric vehicles and hybrid vehicles by the population due to the rising awareness about environmental pollution is driving the sale of electronic vehicles. Although EVs run on electric energy, they also need some kind of lubricant to enhance the performance of the vehicles, which contributes to the higher demand for transmission fluid. Additionally, there is rising government participation in the development and adoption of fully electric and hybrid vehicles with supportive policies and subsidies. The major industry players are adopting the electric vehicles manufacturing as seen the future opportunities in the automobile market. Thus, all these factors are collectively contributing to the growth of the transmission fluid market.
The manual transmission fluid segment dominated the transmission fluid market with the largest market share in 2023. The growth of the segment is attributed to the higher implementation of the MTF (manual transmission fluid), as the transmission oil in the vehicles enhances their performance, driving the demand for the segment. MTF is the specialized transmission fluid used in the manual transmission system that acts as a lubricant in the engine and reduces the friction between the internal components of the transmission system. Manual transmission fluid (MTF) is generally thicker than automatic transmission fluid (ATF) and designed to work under various temperatures and conductions. It is formulated with various additives such as anti-wear agents, extreme pressure agents, and friction modifiers to enhance the performance of the vehicles, prevent them from damaging the transmission system, and increase the life of the vehicle. Thus, all these factors are contributing to the higher demand for the MTF segment.
The automatic transmission fluid segment is expected to grow significantly in the market during the forecast period. The growth of the segment is attributed to the rising adoption of automatic vehicles over manual vehicles. ATF plays an important role in the transmission system, from lubricant to coolant. It provides the connection between the engine and transmission system with the hydraulic coupling known as a torque converter. It maintains the overall engine performance and increases the life of the engine and transmission system of the vehicle for a longer period.
The off-road vehicles segment held the largest transmission fluid market share in 2023. The growth of the segment is attributed to the rising adoption of transmission fluids in off-road vehicles to maintain heavy-duty performance. The rising demand for off-road vehicles by the construction industry for off-road tasks in the construction sites. The off-road vehicle requires high performance and efficient lubricant of different formulations of oil for transmission and the use of a high-pressure hydraulic system. The transmission fluid is the most important in off-road vehicles for smooth hydraulic operations and is used as a backbone loader for pushing tons of load. The rising construction activities and the logistics industry that needs a heavy-duty vehicle for the transportation of goods are driving the growth of the transmission fluid market.
The automotive segment is expected to grow at the fastest CAGR during the predicted period. The growth of the segment is attributed to the continuously rising automotive sector with the launch of the latest personal and commercial vehicles. The rising technological development in the drivetrain, fuel flow, engine, and transmission system over the period is propelling the demand for the automotive sector. Transmission fluid is an essential part of the vehicle's transmission system to protect against damage caused by overheating and friction of the components.
Segments Covered in the Report
By Product
By Application
By Geography
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