Automotive Airbag Market

Automotive Airbag Market: Overview

• Automotive airbags are vehicle passenger restraint systems that help protect the head and chest of the passenger in case of vehicle collision or crash. The airbags are designed in a way that they respond and inflate in milliseconds, providing a cushioning effect to vehicle passengers. The automotive airbags market is estimated to expand consistently during the forecast period.
• The global automotive airbag market was valued over US$ 12.1 Bn in 2020. It is estimated to expand at a CAGR of 8% from 2021 to 2031. Rise in consumer awareness about automobile safety features, such as safety restraint systems that enhance vehicle safety in case of vehicle collision or crashes, is expected to drive the automotive airbag market globally. Key industry players are engaged in design and development of innovative products for automotive airbag that significantly reduce probabilities of injury to vehicle passengers in case of a vehicle crash. For instance, in September 2019, HYUNDAI MOBIS announced the development of integrated ECUs for seatbelts and airbags that use radar sensors to predict accidents and deploy safety systems according to the position of vehicle occupants in order to improve efficiency and safety of these devices.

Drivers of Automotive Airbag Market

• Rise in traffic congestion and increase in vehicle density in larger cities coupled with human error during driving are anticipated to increase the probability of vehicle collision. Consumers are demanding vehicles with advanced safety features in order to be prepared for such unforeseen scenarios. The number of people buying cars that provide safety while compromising little on mileage is increasing globally. Rise in demand for safety in vehicles is compelling automakers to incorporate advanced safety features in their vehicles. For instance, majority of vehicles is currently being installed with parking assistance, adaptive headlights, emergency braking, forward collision warning, and different type of airbags, among other features.
• Technological advancements by market players, which enhance vehicle passenger safety, is driving the market. For instance, in March 2020, HYUNDAI MOBIS announced that it had successfully developed a roof airbag, which prevents passengers from being ejected out of the sunroof and getting injured in case of a rollover accident.

Challenges for Automotive Airbag Market

• Long-term exposure to high heat and humidity can cause these airbags to explode when deployed. Such explosions have caused injuries and deaths. For instance, in the U.S., wrongful deployment of airbags has led to the death of 22 people. This, in turn, has resulted in vehicle recalls, in which automakers identify vehicles using the vehicle identification number (VIN) and check for damaged airbags.
• However, such vehicle recalls affect the consumer trust and hamper brand image. For instance, The National Highway Traffic Safety Administration, (NHSTA) U.S. advised consumers to not drive 2001-2003 Honda and Acura, 2006 Ford Ranger, and Mazda B-Series vehicles, which were equipped Takata company’s airbags. NHSTA advised to replace airbags in these vehicles, as these vehicles were at a far higher risk for an airbag explosion that could injure or kill vehicle occupants. Therefore, vehicle recalls owing to airbag malfunction are expected to hamper the market.

COVID-19 Impact on Automotive Airbag Market

• The COVID-19 pandemic has caused a majority of businesses across the globe to crumble, owing to forced shutdown of production and manufacturing activities. This has led the global economy to contract to its lowest growth rate. Majority of businesses in every industry are codependent and part of major supply chain in the market. Disruption in supply chain attributing to stoppage of transportation and shipping services, and reduced demand for vehicles across the globe have led the global automotive industry to contract in Q1 and Q2 of 2020.
• However, various countries have announced several aggressive monetary policies starting from Q3 of year 2020 in order recover from economic losses caused by the corona pandemic. The global economy is expected to start to recover from year 2021.

Segmentation of Automotive Airbag Market

• The global automotive airbag market has been divided based on application, component, vehicle type, seat configuration, fabric, material, sales channel, and region
• Based on application, the frontal position segment accounted for a higher share of the global automotive airbag market. Airbags for drivers are compulsory in several countries globally. Additionally, several government mandates are compelling automakers to install airbags on the front passenger side. This, in turn, led the segment to account for a major share.
• In terms of component, the global automotive airbag market is dominated by the diagnostic monitoring unit segment. In the automotive airbag assembly, the average cost of the diagnostic monitoring unit is higher as compared to the cost of other components; consequently, leading the segment to account for a major share of the global market, in terms of revenue.
• Based on vehicle type, the passenger segment accounted for a major share of the global automotive airbag market, in terms of revenue. The segment accounted for more than 70% share, in terms of revenue, of the global market in 2020. Globally, the volume of passenger vehicles produced each year surpasses the number of commercial vehicles. The number of airbags are installed in sedans, utility vehicles and hatchback vehicles combined surpasses the number of airbags that are installed in commercial vehicles. This, in turn, led the segment to account for a large share of the global market.
• Based on sales channel, the OEM segment held a major share, in terms of revenue, of the global automotive airbag market. Vehicles are fitted with airbags at the assembly stations of OMEs. This has led the OEM segment to account for more than 90% share of the global market in terms of revenue. The aftermarket segment held a relatively minor share of the global automotive airbag market.

Automotive Airbag Market: Regional Analysis

• The global automotive airbag market has been segregated into North America, Asia Pacific, Europe, Latin America, and Middle East & Africa
• Asia Pacific accounted for a major share of the global automotive airbag market. Presence of a large number of automakers as well as major airbag manufacturers across Asia Pacific has led to the region’s major share of the global automotive airbag market. For instance, in terms of vehicle production, in 2019, Asia Pacific accounted for more than 50% of total global production. Majority of airbags is installed in the vehicle at the time of vehicle assembly.
• Enactment of stringent safety standards across countries in Asia Pacific, such as China, India, Thailand, and Malaysia is anticipated to boost the automotive airbag market. For instance, in India, as per Government mandates, all new passenger vehicles manufactured in the Indian market starting April 1, 2021, would have to be launched with dual front airbags as standard fitment.
• All factors mentioned above are likely to boost the automotive airbag market in Asia Pacific during the forecast period

Automotive Airbag Market: Competition Landscape

• Key players operating in the global automotive airbag market include
  • Aptiv Inc.
  • Autoliv Inc.
  • Calsonic Kansei Corporation (Mareli)
  • Continental AG
  • Delphi Automotive
  • Denso Corporation
  • Hella GmbH & Co. KGaA
  • Hyundai Mobis Co. Ltd
  • INVISTA
  • Joyson Safety Systems
  • Magna International
  • Nihon Plastic Company Co. Ltd
  • Robert Bosch GmbH
  • Takata Corporation
  • Toyota Gosei
  • Valeo SA
  • ZF Friedrichshafen
• Key players operating in the global automotive airbag market are expanding their presence by engaging in mergers and acquisitions or establishing new facilities. For instance, In November 2020, INVISTA announced expansion of nylon polymer manufacturing capacity in China to 190,000 tons per year with an additional capacity of 40,000 tons per year to cater the constantly growing local demand. Increased demand for engineering polymers used in automotive, electrical & engineering markets, such as light weighting, powertrain parts optimization, electrification, and automation are driving the demand for nylon polymers in China.
• Additionally, Joyson Safety Systems has devised an ambitious plan to expand its manufacturing capacity through the construction of huge plants in four regions across the world. The upgrade and expansion of the manufacturing plant in Hungary was completed in November 2019. It is expected to be one of the world’s largest and most automatic automotive airbag factory.