Transportation Technologies Driving Automotive Testing, Inspection, and Certification Services

The concept of TIC (Testing, Inspection, and Certification) is gradually becoming commonplace due to increased awareness about environmental regulations. Companies in the automotive testing, inspection, and certification market are leveraging opportunities in government as well as in the leasing and fleet companies to generate new revenue streams. This explains why testing and certification services are projected for tremendous growth and the market for automotive testing, inspection, and certification is estimated to reach a value of ~US$ 29 Bn by 2027.

In order to capitalize on the demand for TIC services, companies are launching new laboratory buildings to expand their reach. For instance, Intertek Group Plc.- a leading Total Quality Assurance provider to industries worldwide, announced the launch of their new laboratory building in San Antonio, housing its transportation technologies services. Companies in the automotive testing, inspection, and certification market are exploring multiple services such as chemical testing, emissions testing, and mechanical testing for automotive components.automotive testing inspection certification market infographic

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Demand for Wireless Connectivity Encourages Companies to Focus on Industry-specific Tests

The projected increase in vehicle connectivity has fueled the demand for automotive testing, inspection, and certification services. The ever-evolving needs of occupants have led to advancements in wireless automotive technologies. Key drivers such as industry 4.0 and IoT are contributing toward the growth of the automotive testing, inspection, and certification market. Wireless communication technologies are playing a crucial role in the safety of occupants. Thus, growing consumer demands for automated and connected mobility solutions are resulting in exponential growth of the automotive testing, inspection, and certification market, which is anticipated to progress at a CAGR of ~8% during the forecast period.

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Long range and short range applications of connected mobility solutions involve the global navigation satellite system and Near Field Communication (NFC). Hence, companies in the market for automotive testing, inspection, and certification are increasing their efficacy in industry-specific tests to focus on the functionality and efficiency of technologies. For instance, TÜV SÜD- a leading technical service corporation, is providing FCC (Federal Communications Commission) and GMA (Generic Multi-Access) (GMA) compliance for wireless and safety requirements.

Need for Uniform Regulatory Authority Persuades New Entrants to Compete with Leading Players

The automotive testing, inspection, and certification market is largely fragmented, as eight leading players account for ~20% of the market stake. However, heavy regulations associated with wireless equipment in vehicles pose a barrier for market growth.

Since several different regulatory boards in the market for automotive testing, inspection, and certification are introducing regulations, it is difficult for carmakers to get their products certified from regulatory authorities. Big enterprises in the automotive testing, inspection, and certification market are suffering exorbitant costs in the pursuit of their certification and smaller new entrants are falling short on expertise in order to succeed in the highly competitive automotive industry. Hence, there is growing demand for establishment of a uniform global regulatory authority that streamlines certification requirements of carmakers.

It is crucial for new entrants in the market for automotive testing, inspection, and certification to gain industry-specific expertise in wireless technologies and other aspects associated with industry 4.0 in the coming years.

Profitable Ventures Create Business Scope in Automated Vehicle Inspection

Strategic alliances of companies in the automotive testing, inspection, and certification market has led to the emergence of automated vehicle inspection. For instance, WeProov— an inspection mobile solution company, collaborated with the Bernard Group, one of the largest distributors of industry vehicles in France, to introduce their venture ProovStation to innovate in automated vehicle inspection services. As such, companies dealing in automated vehicle inspection services are tapping business expansion opportunities in France. This is evident, since the automotive testing, inspection, and certification market in Europe is estimated to witness significant growth in the near future.

Companies in the market for automotive testing, inspection, and certification are generating incremental opportunities through automated vehicle inspection services with the help of blockchain and AI technologies. Novel inspection services are being pervasively replaced by custom and time-efficient technological solutions. Companies are innovating in platforms that connect IT of vehicles with the API (Application Program Interface) of the novel software platforms.

automotive testing inspection certification market segmentation

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Analysts’ Viewpoint

Ensuring safety and reliability in transportation services has become one of the key focus points for companies in the automotive testing, inspection, and certification market. In order to comply with strict environmental regulations, companies are increasing their efficacy in emissions testing for all-terrain vehicles (ATVs) and motorcycles, among others.

Several different regulations such as the Radio Equipment Directive (RED) in Europe and the Federal Communications Commission (FCC) in the U.S. have created ambiguity among companies resulting in revenue losses while pursuing certification of products. Hence, both leading and small-scale companies should specialize in extensive R&D of regulatory framework of different regions to comply with industry-ready technologies such as wireless connectivity, IoT, and AI.

Automotive Testing, Inspection, and Certification Market: Overview

  • The global automotive testing, inspection, and certification market is expected to expand at a CAGR of ~8% between 2019 and 2027
  • Rising automation of vehicles and integration of advanced features in modern-age vehicles are propelling the automotive testing inspection, and certification industry
  • Variations in technologies of vehicles and rising number of accidents due to manufacturing faults are anticipated to drive the market

Dynamics of Automotive Testing, Inspection, and Certification Market

  • Automotive testing, inspection, and certification services are performed to check roadworthiness of a vehicle. This is a standard procedure performed by governing bodies or government certified agencies to check whether a vehicle is capable to meet the standards regarding vehicle enacted by the governing bodies of a respective country.
  • Standardization for different parameters of a vehicle such as emission limit, number of air bags required, seat belts, and other safety features is driving the automotive testing, inspection, and certification market
  • Rising number of accidents; increasing integration of automation in vehicles, such as advanced and more sophisticated components and features of a vehicle, and increasing pollution are key factors fueling the demand for vehicle tasting and inspection. In Europe and North America, stringent rules for periodic vehicle inspection and testing have been enacted to ensure the safety of human lives. These regulations are further boosting the automotive testing, inspection, and certification market.
  • Since the automotive industry is undergoing massive transition, which includes development and adoption of new energy vehicles and integration of more Internet- and Artificial Intelligence-based technologies, the testing industry is expanding at a high growth rate.

Challenges for Automotive Testing, Inspection, and Certification Market

  • Testing and inspection are mandatory and essential from the perspective of accident safety and emission, yet several consumers avoid undergoing these tests. This, coupled with the lack of internationally accepted standards across all regions, is a major restraint to the automotive testing, inspection, and certification market.

Segmentation of Automotive Testing, Inspection, and Certification Market

  • Based on service type, the automotive testing, inspection, and certification market has been divided into testing, inspection, certification, and others. In the testing segment, a vehicle model undergoes numerous tests such as frontal and side crash test, emission test, safety test, and other roadworthiness tests.
  • In the inspection segment, the vehicle undergoes a thorough inspection. Vehicle parameters such as emission, noise, vehicle interior, under chassis components, braking system, steering and brake fuel, transmission system, head lamps, horns, and other components of a vehicle are inspected.
  • In the certification segment, a vehicle is accredited with a certificate on passing the testing or inspection tests. The other service segment consists of vehicle maintenance, vehicle repairing, vehicle servicing, and vehicle component replacement services. Among all segments, certification and testing segments dominate the market. In several countries, certification is mandatory for all types of vehicles; hence, certification was the leading segment of the automotive testing, inspection, and certification market, followed by the inspection services, in 2018
  • Cost of a testing service is much higher than that of an inspection service; therefore, in terms of revenue, the testing service segment holds a higher share than that of any other segment. Inspection services are mandatory at a specific time period and certification is mandatory for each vehicle. A certificate is proof of the tests or inspection performed on the vehicle.
  • Based on location, the automotive testing, inspection, and certification market has been segregated into on-site and off-site. In on-site inspection, testing and inspection services are performed at the vehicle location. This primarily includes a few vehicle manufacturers, vehicles that are imported or exported, and a few owners of vehicles. Under off-site sourcing, the vehicle undergoes tests, inspection, and certification at the location of the providing agency. A majority of commonly conducted tests are included under this segment.
  • In terms of sourcing type, the automotive testing, inspection, and services market has been split into Original Service Provider (OSP), workshop, and others. The OSP segment comprises tests performed by government authorized testing, ins3pection, and certification agencies.
  • The workshop segment consists of services that are conducted at a workshop. It primarily includes vehicle maintenance services, repairing services, components replacement services, and other inspection services. Except OSP and workshop, all other service providers are included in this segment. OSP is anticipated to be the leading segment of the market in terms of revenue.

Automotive Testing, Inspection, and Certification Market: Regional Analysis

  • The global automotive testing, inspection, and certification market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and Latin America. Europe dominated the global automotive testing, inspection, and certification market in 2018, while the market in Asia Pacific is expanding at a rapid pace. Moreover, China and countries in ASEAN are likely to emerge as notable testing and certification centers for electric and autonomous vehicles.
  • Several leading manufacturers are testing their autonomous technologies in Singapore (Sub-region of ASEAN) and availability of required infrastructure in the region is further propelling the market for internet-based automotive services.

Automotive Testing, Inspection, and Certification Market: Competition Landscape

  • A large number players operating in the global automotive testing, inspection, and certification market have been focusing on mergers and acquisitions in order to expand their operations in various regions. Consequently, several service providers are operating in the global automotive testing, inspection, and servicing market. Key service providers operating in the market of automotive testing, inspection, and servicing market include 
    • SGS SA
    • Bureau Veritas
    • DEKRA
    • Intertek Group
    • TUV SUD
    • DNV GL
    • TUV Rheinland
    • Applus+
    • ALS Limited
    • TUV NORD GROUP
    • MISTRAS Group, Inc.

Global Automotive Inspection, and Certification Market: Overview

This report analyzes and forecasts the market for automotive testing, inspection, and certification at the global and regional level. The market has been forecasted based on revenue (US$ Mn) from 2017 to 2025. The study includes drivers and restraints of the global automotive Testing, inspection, and certification market. It also covers the impact of these drivers and restraints on demand for automotive testing, inspection, and certification during the forecast period. The report also highlights opportunities in the automotive testing, inspection, and certification market at the global and regional level.

The report comprises a detailed value chain analysis, which provides a comprehensive view of the global automotive testing, inspection, and certification market. Porter’s Five Forces model for the automotive testing, inspection, and certification market has also been included to help understand the competitive landscape in the market. The study encompasses market attractiveness analysis, where in end-users are benchmarked based on their market size, growth rate, and general attractiveness.

Global Automotive Inspection, and Certification Market: Scope of the Report

The study provides a decisive view of the global automotive testing, inspection, and certification market by segmenting it by service type, by sourcing type, by place, and geography. These segments have been analyzed based on present and future trends. Regional segmentation includes the current and forecast demand for automotive testing, inspection, and certification in North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. The report also covers demand for individual segments in all the regions.

The report provides the estimated market size of automotive testing, inspection, and certification for 2016 and forecast for the next nine years. The global market size of automotive testing, inspection, and certification has been provided in terms of revenue. Market numbers have been estimated based on key service type, sourcing type, place, and region. Market size and forecast for each major service type, sourcing type and place have been provided in terms of global and regional/country markets.

In order to compile the research report, we conducted in-depth interviews and discussions with a number of key industry participants and opinion leaders. Primary research represents the bulk of research efforts, supplemented by extensive secondary research. We reviewed key players’ product literature, annual reports, press releases, and relevant documents for competitive analysis and market understanding. Secondary research also includes a search of recent trade, technical writing, internet sources, and statistical data from government websites, trade associations, and agencies. This has proven to be the most reliable, effective, and successful approach for obtaining precise market data, capturing industry participants’ insights, and recognizing business opportunities.

Global Automotive Inspection, and Certification Market: Research Methodology

Secondary research sources that are typically referred to include, but are not limited to company websites, annual reports, financial reports, broker reports, investor presentations, and SEC filings, internal and external proprietary databases, and relevant patent and regulatory databases, national government documents, statistical databases, and market reports, news articles, press releases, and webcasts specific to companies operating in the market, National government documents, statistical databases, and market reports, North American Department of Transport, Europe Department of Transport, Automotive Research Association of India (ARAI), Organisation Internationale des Constructeurs d'Automobile (OICA), Factiva, etc.

Primary research involves e-mail interactions, telephonic interviews, and face-to-face interviews for each market, category, segment, and sub-segment across geographies. We conduct primary interviews on an ongoing basis with industry participants and commentators in order to validate the data and analysis. Primary interviews provide firsthand information on market size, market trends, growth trends, competitive landscape, and outlook, etc. These help validate and strengthen secondary research findings. These also help develop the analysis team’s expertise and market understanding.

Global Automotive Inspection, and Certification Market: Competitive Dynamics

The study includes profiles of major companies operating in the global automotive testing, inspection, and certification market. Key players in the automotive testing, inspection, and certification market SGS SA, Bureau Veritas, Dekra, Intertek Group, TUV SUD, DNV GL, TUV Rheinland, Applus+, ALS Limited, TUV Nord Group, and Mistras Group, Inc. Market players have been profiled in terms of attributes such as company overview, financial overview, business strategies, and recent developments. The market for automotive testing, inspection, and certification is primarily driven Implementation of new vehicle regulations and standards, increased dependency on inspection and verification services, and stringent safety regulations.

The automotive testing, inspection, and certification market has been segmented as follows:

By Service Type

  • Testing
  • Inspection
  • Certification
  • Other

 By Sourcing Type

  • Onsite
  • Offsite

By Place

  • OSP
  • Workshop
  • Other

By Region/ by Countries/ by sub-region

  • North America
    • U.S.
    • Canada
  • Europe
    • Germany
    • U.K
    • France
    • Italy
    • Spain
    • Rest of Europe
  • Asia Pacific
    • China
    • India
    • Japan
    • Rest of Asia Pacific
  • Middle East & Africa
    • GCC
    • South Africa
    • Rest of Middle East & Africa
  • Latin America
    • Brazil
    • Mexico
    • Rest of Latin America

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