The global automotive differential market is anticipated to grow at a CAGR of 5.9% during 2021-2027 and is expected to reach USD 26.2 billion by 2027. The increased need for better traction on roads and fuel-efficient vehicles are the major drivers of the market. Furthermore, the increased demand for all-wheel drive vehicles, rising penetration of AWD and 4WD vehicles, mounting demand for commercial vehicles, and growing demand for lightweight and high-performance automotive components will propel the differential market. The key strategy for gaining a competitive advantage is to develop electronically limited-slip differentials, increase demand from developing countries, and win contracts/agreements, while production of electronically limited-slip differentials is expected to supplement the global automotive differential market growth.

The COVID-19 pandemic has declined the demand for automotive production and sale globally, resulting in a decrease in sales for automotive differential.

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Based on the drive type, the global automotive differential market is segmented into Open Differential, Locking Differential, Limited Slip Differential, Electronic Limited Slip Differential, and Torque Vectoring Differential. The limited-slip differential is further divided into a clutch plate limited-slip differential and a viscous limited-slip differential. Open differentials are commonly seen in passenger cars such as family sedans, vans, and economy cars. Locked differentials, on the other hand, are common, but not always, utilized in off-road vehicles.

Asia-Pacific is anticipated to have the largest market share during the forecast [period 2021-2027 owing to increased vehicle production post-COVID-19 crisis. Moreover, the rising inclination towards all-wheel and four-wheel drive integrate vehicles has gained its prominence in off-road vehicles and sports cars.

In September 2021, Eaton's has introduced a new series of differentials for electrified vehicles that deliver performance comparable to that of older ICE vehicles. Eaton claims that its Traction Control differentials can improve traction and stability while trailering in unfavorable weather. Automatic limited-slip, automatic locking, and electronic selective locking differentials are the differentials offered by the company for electrified vehicles.

The prominent players in the global automotive differential industry include American Axle & Manufacturing, Inc. (AAM), BorgWarner Inc., Dana Incorporated, Eaton, Hyundai Wia Corporation, JTEKT Corporation, Linamar Corporation, Melrose Industries PLC, Schaeffler Group, ZF Friedrichshafen AG, GKN, Continental AG, Auburn Gear LLC, Neapco Holdings LLC, Magna International Inc., Drexler Companies Inc., RT Quaife Engineering Ltd., Xtrac Ltd, NSK Ltd., Bharat Gears Ltd., CUSCO Japan Co. Ltd., Zen Technologies Limited, and Kermanmotor Co.

Source: VynZ Research