According to the Market Statsville Group (MSG), the Global automotive steel Market was valued at USD 112,931.9 million in 2023 and is expected to grow from USD 126,390.1 million in 2024 to USD 161,757.6 million by 2033, by exhibiting a CAGR of 3.1% during the forecast period (2024-2033)
The automotive steel market is a sub-sector of the overall steel industry whose main concern is centered on the manufacturing use of steel in automobiles. Thus, as vehicles are now being featured with more complex structures and higher performance levels, the need for these steel products has changed as well. Automotive steel is the kind of steel used in automobile production, and it has a wide category such as structural steel, bodywork steel, and safety steel. It includes several steels and their treatments relating to the performance characteristics required. The key drivers that affect the automotive steel market include production quantities of vehicles, new developments in automobile design, and laws and policies. It has undergone growth due to the need for cars in the market and the need to come up with better cars to meet the market needs for safe and efficient cars. New steel materials and technological advancements in the production of metallic materials such as steel are to lower vehicle weight while at the same time enhancing structural integrity and safety. Enhanced coatings and treatments are employed for refurbishing steel parts to increase their life and the working life. Automotive steel is 100% recyclable, and its use by the automotive industry is leaning more toward the use of recycled steel to cut its impacts on the environment.
Moreover, improvement is being worked towards minimizing the energy consumption value in manufacturing steel. Increased safety requirements lead to the need to use higher-performing steels for improving crashworthiness. There is pressure towards the use of lightweight materials to enhance fuel economy and the reduction of emissions. The principal automotive steel makers are present in some parts of North America, Europe, China, and India. This he claimed changes with automotive production cycles as well as the economic cycles in the different regions. Steel prices are influenced by raw material costs, production capacities, and geopolitical factors. Fluctuations in the prices of iron ore and other raw materials affect steel production costs. Meeting stringent regulations for safety and emissions can be costly and complex. Developing new steel grades and processing techniques offers opportunities for market growth. Increasing vehicle production and demand in emerging economies present significant expansion opportunities.
Automotive steel essentially refers to any type of steel used in vehicle manufacturing. These steels are chosen for their characteristics, such as high strength, durability, and high formability, to meet the above automotive applications. Automotive steel is also used in autobodies, chassis, automotive engine parts, or auto safety structures.
Automotive Steel Market Dynamics
The development and application of grades of AHSS such as Dual-Phase (DP), Transformation-Induced Plasticity (TRIP), and Martensitic steels are essential in enhancing safety values along with weight reduction in vehicles. This growth represents a higher level of usage of AHSS in the automotive industry by its weight reduction factors along with improved safety factor contribution. R&D in the development of steel alloys and processing has been focused on reducing the weight of the vehicle but without any compromise on the strength or safety of the vehicle. It is estimated that approximately 20-30% of the total steel used in AHSS is found in modern vehicles. The percentage is only going to rise with time as most manufacturers are looking for ways through which they
Furthermore, Another factor contributing to the enhanced performance of auto steel parts is highly advanced manufacturing processes like hot stamping and hydroforming. Auto Steel Parts reduce vehicle weight by about 20-30% of weight from traditional steel grades. For example, using AHSS in the body of the vehicle can save up to 200 kg in weight, which means there is better fuel efficiency and fewer emissions. Coatings and surface treatments will enhance corrosion resistance and toughness of steel. For each 100 kg in vehicle weight reduction, there is a gain of approximately 0.5-1.0 liters per 100 kilometers or roughly 47-94 mpg. This efficiency gain has become indispensable for the attainment of stringent fuel economy requirements.
Volatility in raw material price is one of the biggest challenges experienced in the automotive steel market and impacts not only the cost of production but the dynamics of markets as well. The primary raw material in steel production has been iron ore. Prices of iron ore remain volatile and are influenced by global supply-demand dynamics, mining output, and geopolitical factors. It is used in the steel manufacturing process for coking, which is of significant importance to alter the highly compressed metal into steel. Prices for coking coal differ based on the mining conditions and the policies of the global trade. Steel from scrap is melted down and used in electric arc furnaces (EAF) to make new steel. Prices for scrap steel are a factor with change based upon recycling rates and availability. Historically, it has been volatile in terms of pricing of iron ore. For instance, the price of iron ore has ranged between $40 and $200 per ton.
For instance, IEA indicates that with high demand from China and supply disruptions, prices per ton increased dramatically to more than $200 per ton, especially in 2021. The variation in raw material prices immediately reflects in the production cost of the steel. For instance, IEA states that a 10% surge in iron ore will boost the total costs of producing steel by 5-7%. The high price of raw materials can exert margin pressure on the producers, thus making profitability and pricing difficult. Therefore, some of the additional costs incurred by the raw material for steel may be transferred to car OEMs through the higher selling prices of steel by the manufacturers. This will increase the manufacturing cost of automobiles while continuing to increase costs to consumers. Long-term supply contracts between steel producers and automotive OEMs may reduce the impact of price volatility while in the short term, fluctuations may appear in the prices.
The study categorizes the automotive steel market based on steel type, steel processing type, application, and vehicle type area at the regional and global levels.
Based on the steel type, advanced high-strength steel has been the leading segment in the automotive steel market, surpassed all grades of traditional steel in its aspect due to superior properties. AHSS is an important innovation in the automotive material as it offer the benefits of strength, durability, and weight efficiency. It plays an important role in meeting the constantly increasing requirements of the automotive industry towards safer, fuel-efficient, and environmentally friendly vehicles. AHSS has a high strength-to-weight ratio, which helps in reducing the weight of the vehicle without losing on safety and structural strength. Such criteria are important to achieve the very stringent targets for improving fuel efficiency and reduction in emission. High strength and ductility in AHSS mean better absorption of energies during collisions, which in turn improve crashworthiness as well as occupants' safety in vehicles.
Additionally, AHSS is used in auto parts such as body panels, chassis components, and structural reinforcements. The flexibility of AHSS facilitated its usage in wide variations of car ranges, specifically between economy, middle ranged, and high-end vehicles. Increasing pressure on the demand for fuel efficiency and emission standards forces automotive companies to be more accepting of AHSS. According to the claims made by governments about demands for lighter vehicles, AHSS is the most feasible option. Customers of different types are becoming concerned about fuel efficiency and safety regarding the use of a vehicle. AHSS satisfies these needs with improved strength while also reducing vehicle weight. The continuous innovation in manufacturing AHSS, which includes advanced manufacturing processes and material science, is broadening the scope of application and performance. This will lead to increased uptake within the industry of automobiles.
Based on the region, North America is set to grow steadily as a result of increased vehicle production and advanced steel solution demand, making it a dominant region during the entire forecast period. Major steel-producing firms such as ArcelorMittal, U.S. Steel, and Nucor are based in this region. These are large automotive producers: General Motors, Ford, and Stellantis-they account for a large share of the market in North America. The North American OEMs are fixated on lightening up the vehicle to meet the expectations of fuel efficiency and emission. The trend will drive up the demand for AHSS, the lightweight material.
The U.S. and Canadian governments impose severe rules on fuel economy and emissions standards, forcing the manufacturers to opt for more advanced steel solutions to meet these standards. There has been a movement toward reshoring, bringing steel production and automotive manufacturing back into local regions to reduce risks in supply chain vulnerability and develop local capabilities. The U.S. automotive steel market is significant in size considering the high volumes of vehicle production and high emphasis on novel steel technologies. The adoption of AHSS and advanced coatings is prevalent in the U.S. automotive sector. Canada’s automotive steel market is influenced by both domestic production and imports. The country is investing in steel technologies to support its automotive industry and reduce carbon emissions.
The automotive steel showcase is a critical competitor and amazingly ferocious in the division. It is utilizing methodologies counting organizations, item dispatches, acquisitions, understandings, and development to upgrade their positions in the advertiser. Most divisions of businesses center on expanding their operations around the world and developing long-lasting partnerships.
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