In a Rapidly Changing Economic Scenario, Here’s What to Expect in the Global Automotive Airbags Market in 2020 & Beyond
The global market for Automotive Airbags is projected to reach US$71.8 billion by 2025, driven by the indispensability of air bags as a key mandated safety technology for all vehicles.
Global Industry Analysts, Inc. (GIA) launches comprehensive analysis of industry segments, market trends, growth drivers, market share, size and demand forecasts on the global Automotive Airbags market. Report segmentation include Type (Side-Impact Airbags, Front-Impact Driver Airbags, Front-Impact Passenger Airbags, and Other Types); and End-Use (Passenger Cars, and Commercial Vehicles).
7 June 5:29 A.M., California/Marketwire/ - According to the new market research report, the global market for Automotive Airbags is projected to reach US$71.8 billion by 2025, driven by the indispensability of air bags as a key mandated safety technology for all vehicles. The market is expected to decline in the year 2020 before recovering to reach a revised market size and reset to a new normal which going forwards in a post COVID-19 era will be continuously redefined and redesigned.
Adding to the long term positive outlook for the market is the stable automobile production trend; development of new air bag technologies; decline in costs of driver side airbags; development of smart airbags with sensors; focus on road safety as a result of the recent spike in road accidents and the resulting legislation of regulations that mandate installation of airbags in all types of automobiles, especially in developing economies. However, the sentiment in the market is sobered down by the flaring up of Takata's airbag recall in the year 2020 when the National Highway Traffic Safety Administration (NHTSA) announced immediate recall of another 10 million vehicles carrying the defective airbag. The recent recall is in continuation of recalls which began in the year 2011. Running for over 9 years now, the recall is the largest and most complex in the history of the automotive industry that sent Takata into bankruptcy in the year 2017. Over 15 OEMs worldwide today face billions of dollars in recall losses. Globally, over 30 deaths and 350 injuries have been associated with takata's faulty air bags. In the United States, virtually every OEM is impacted by the recall including Detroit's giants Honda, Toyota, Nissan, BMW, Daimler, Subaru and Volkswagen and Audi. Approximately, 45 million vehicles in the United States have been equipped with these defective air bags which are prone to explosion during deployment. General motors (GM) has estimated a bleak and painful US$1.2 billion in losses accruing from the ongoing recalls that involves over 6.5 million GM models with faulty Takata inflators. Honda is faced with the recall of an additional 131 million Honda and Acura vehicles in North America alone. The recalls till date has and continues to involve the recovery of over 100 million inflators, impacting over 19 major OEMs worldwide. During the early phases of the recall, Takata repaired over 50% of the airbags and the current 10 million new recalls include some of these already replaced modules as well, forcing OEMs to initiate expensive campaigns to replace even previously recalled inflators with updated parts. Mazda is recalling over 117 thousand vehicles including those already recalled and repaired. With regulators in the U.S mulling the possibility of expanding the recall to include additional modules which were not part of the original recall, the blow for OEMs is expected to get even sharper. With the total cost of the expanded recalls running into billions of dollars mostly shouldered by auto OEMs, the automotive industry stands disrupted and uncertain as it struggles to negotiate this new and emerging risk landscape.
Product recalls is the emerging new risk for auto OEMs, which is compounded by complexity of global decentralized supply chains, stringent government safety mandates that push up quality related risks, and increasing cost pressure for suppliers and cost based decisions that bring-in inherent vulnerabilities. With product related risks becoming the single most biggest threat for OEMs, the importance of supplier relationship management (SRM) is coming to fore. Globalization has cast a "Ripple effect" on product recalls making them more larger, wider, deadlier and devastating for stakeholders. Global companies today sell millions of cars worldwide and source components from numerous manufacturers worldwide. Managing this complex global supply chain is the biggest and an increasingly difficult challenge for OEMs today. Takata's recalls has laid bare major gaps in SRM practices in the automotive industry. Over 70% of OEMs have 0% visibility of their tier 2 &3 suppliers. Most supplier programs are built only for tier 1 suppliers. The need of the hour is the development of robust, responsible relationships with suppliers to reduce the risk of recalls. A strong OEM-supplier governance mechanism will also ensure socially responsible recalls and quicker recovery of both parties from a recall crisis. Strategic supply chain management supported by supply chain analytics and software systems for supplier tracking and management, is therefore growing in importance. Especially against the backdrop of the progress being made in the commercialization of autonomous cars and smart cars loaded with electronic and software features such as autonomous-driving assistance, geolocation services etc., the focus on "zero-defect" manufacturing should gain more significance. OEMs need to move from reactive fire-fighting to recall prevention by stepping up quality-management strategies from single quality processes to integrated quality systems.
Key Competitors Covered in the Report
Key Safety Systems Inc.
Toyoda-Gosei Co. Ltd.
TRW Automotive Holdings Corp.
Geographies Analyzed in the Report
Europe (France, Germany, Italy, United Kingdom, Spain, Russia, and Rest of Europe)
Asia-Pacific (Australia, India, South Korea, and Rest of Asia-Pacific)
Latin America (Argentina, Brazil, Mexico, and Rest of Latin America)
Middle East (Iran, Israel, Saudi Arabia, United Arab Emirates, and Rest of Middle East)
This latest edition of the research study is conducted and published by Global Industry Analysts, Inc., in close collaboration with senior executives in the industry driving strategy, business development, marketing, sales, product management, technology and operations. All analysis and findings published in the report are based on validated engagements from a total executive pool size of 753. Among this pool, 151 direct interactions with domain experts were carried out via our proprietary market research platform, MarketGlass. Among the 32 unique participations, a total of 14 validated responses were received as part of this report's primary research outreach program. We are unique in the industry to provide our clients with the validated list executive engagements and the complete project data stack.
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