Global Automotive Exhaust Aftertreatment Systems Market - 2024-2031

Report Overview

The Global Automotive Exhaust Aftertreatment Systems Market reached US$ 21.93 billion in 2023 and is expected to reach US$ 27.72 billion by 2031, growing with a CAGR of 3.0% during the forecast period 2024-2031.

The automotive exhaust aftertreatment systems, including diesel oxidation catalysts (DOCs), selective catalytic reduction (SCR) systems, diesel particulate filters (DPFs) and gasoline particulate filters (GPFs), help minimize harmful emissions like nitrogen oxides (NOx), carbon monoxide (CO), hydrocarbons (HC) and particulate matter (PM). The market is driven by the increasing demand for vehicles that comply with stringent emission regulations and the growing focus on reducing greenhouse gas emissions.

Automakers are focusing on enhancing the efficiency of exhaust aftertreatment systems to comply with upcoming emission standards, as technological advancements continue to influence the market. For instance, advancements in selective catalytic reduction systems, such as the adoption of ammonia slip catalysts and smaller SCR configurations, are becoming increasingly popular in large trucks. In the same way, GPFs are being more commonly used in GDI engines to combat particulate emissions, particularly in cars for passengers.

Emerging markets in Asia-Pacific, particularly China and India, are contributing to this growth due to increased vehicle ownership and stringent regulations. Regulations such as Euro 6 in Europe, Bharat Stage VI in India and Tier 3 standards in US, mandate lower emissions from vehicles. Countries in Asia-Pacific, such as China and India, are witnessing rising adoption of after-treatment technologies as their automotive industries grow and align with these global environmental standards.

Market Dynamics

Stringent Emission Regulations for the Automotive Sector

Governments and international bodies are enforcing stricter environmental regulations, particularly in major automotive markets like North America, Europe and parts of Asia. Regulations like the Euro 6 standards in Europe and the EPA Tier 3 standards in US are examples of frameworks that limit the permissible levels of NOx, CO and particulate emissions from vehicles.

The regulations mandate the use of advanced exhaust aftertreatment technologies, such as Selective Catalytic Reduction (SCR) and Diesel Particulate Filters (DPF), in both passenger and commercial vehicles. In response, automotive manufacturers are focusing on integrating these systems to ensure compliance and avoid penalties. This is expected to drive the demand for automotive exhaust aftertreatment systems.

Growing Adoption of Cleaner Technologies

The market is driven by the rising adoption of cleaner technologies across the automotive industry. While electric vehicles (EVs) are gaining demand, amid internal combustion engine (ICE) vehicles still dominate the global automotive market. In regions where EV adoption is slower, such as parts of Asia and Latin America, aftertreatment systems play a critical role in making ICE vehicles more environmentally friendly.

In countries such as Brazil, where vehicular pollution is a major concern, governments are offering incentives for automakers to incorporate cleaner technologies into their vehicles. For instance, Brazil regulates vehicular emissions through the Air Pollution Control Program by Motor Vehicles (PROCONVE), which was created in 1986. The latest PROCONVE standards are L-7 and L-8. L-7 standards were scheduled to be implemented in January 2022 for all new vehicles, requiring manufacturers to use advanced exhaust aftertreatment systems.

Market Saturation with Fluctuating Cost of Raw Material

In mature markets, the saturation of advanced aftertreatment systems can significantly constrain opportunities for new entrants. As these markets become saturated, with high penetration of advanced emissions control technologies, the potential for further growth diminishes. This saturation is particularly prevalent in regions with well-established emissions control frameworks, where the market is already dominated by sophisticated aftertreatment systems.

Additionally, the effectiveness of aftertreatment systems is heavily reliant on proper maintenance and infrastructure. Inadequate infrastructure and maintenance capabilities in certain regions can severely limit market growth. For aftertreatment systems to function optimally and have a long lifespan, they require robust infrastructure and regular upkeep. The International Council on Clean Transportation (ICCT) and numerous national transportation departments emphasize that challenges in maintenance and infrastructure can hinder the performance of these systems.

Market Segment Analysis

The global automotive exhaust aftertreatment systems market is segmented based on component, vehicle, fuel, sales channel and region.

The Impact of Emission Regulations and Rising Passenger Vehicle Production

Stringent emissions regulations, higher vehicle production and a focus on cleaner transportation technologies are driving the demand for passenger vehicles in the market. Governments globally, such as the European Union (EU) and US Environmental Protection Agency (EPA), have put in place stringent regulations to restrict damaging emissions like nitrogen oxides (NOx) and particulate matter (PM). The EPA's Tier 3 and the EU's Euro 6 regulations have increased the demand for exhaust aftertreatment systems in cars to meet requirements.

Global passenger vehicle production continues to be strong, especially in developing regions experiencing growth in automotive markets, as reported by the International Organization of Motor Vehicle Manufacturers (OICA). This increase requires more exhaust aftertreatment systems due to manufacturers' efforts to comply with local and international emission standards. Furthermore, the ICCT has pointed out the significant influence of policies such as the EU's "Fit for 55" and India's BS-VI norms on the market's growth path.

Market Geographical Share

Rising Vehicle Production and Advanced Manufacturing Capabilities in Asia-Pacific

In Asia-Pacific, the automotive exhaust aftertreatment systems market is experiencing significant growth due to stringent emission regulations, increasing vehicle production and growing environmental awareness. Nations in the region are advocating for vehicles that are cleaner and more fuel-efficient. The FAME scheme by the Indian government aims to boost hybrid and electric vehicles, but traditional vehicles with ICE engines remain prevalent.

The automotive industry is witnessing increased investments in research and development of new aftertreatment technologies. In Japan, the Japan Automobile Manufacturers Association (JAMA) has emphasized collaboration between automotive companies and the government to develop next-generation emission control systems. Similarly, the Association of Southeast Asian Nations (ASEAN) Automotive Federation notes that countries like Indonesia, Thailand and Vietnam have seen substantial growth in vehicle production, which directly impacts the demand for emission control systems.

Market Competitive Landscape

The major global players in the market include BASF SE, Continental AG, Cummins Inc., Denso Corporation, Faurecia S.A., Friedrich Boysen GmbH & Co. KG, Johnson Matthey Plc, Plastic Omnium S.A., Robert Bosch GmbH and Tenneco Inc.

Sustainability Analysis

The market for automotive exhaust aftertreatment systems is leading in sustainability efforts, motivated by the requirement to lower emissions and strict environmental laws. Essential systems such as diesel particulate filters, selective catalytic reduction and exhaust gas recirculation are designed to reduce the release of harmful emissions like nitrogen oxides (NOx), carbon monoxide (CO), hydrocarbons (HC) and particulate matter (PM).

Furthermore, the move towards a circular economy is also impacting the sustainability characteristics of the aftertreatment systems market. Manufacturers are adopting programs for managing end-of-life where they recycle used catalytic converters and DPFs. The Automobile Recyclers Association (ARA) states that almost 95% of car parts can be reused, re-manufactured or recycled, such as exhaust systems, resulting in decreased landfill waste and resource extraction.

Russia-Ukraine War Impact

The market for automotive exhaust aftertreatment systems has been greatly affected by the Russia-Ukraine war, mainly due to supply chain disruptions, increased energy costs and geopolitical instability. Russia and Ukraine play a vital role as key providers of important raw materials such as nickel, palladium and platinum, necessary for the production of catalytic converters employed in exhaust emission control systems. Only Russia is responsible for approximately 40% of the global palladium supply.

Europe, a major hub for the automotive industry, has faced an energy crisis due to the war, driving up the cost of manufacturing processes. The European Automobile Manufacturers' Association (ACEA) highlighted how increased energy prices, driven by reduced gas supplies from Russia, are making manufacturing operations more expensive. The war has exacerbated material shortages, increased production costs due to energy inflation and created uncertainties in regulatory compliance and supply chain resilience.

By Component

Three-Way Catalytic Converters

Diesel Particulate Filters

Diesel Oxidation Catalysts

Selective Catalytic Reduction

Gasoline Particulate Filters

Lean NOx Traps

Others

By Vehicle

Passenger Vehicles

Commercial Vehicles

By Fuel

Gasoline

Diesel

By Sales Channel

OEMs

Aftermarket

Region

North America

US

Canada

Mexico

Europe

Germany

UK

France

Italy

Spain

Rest of Europe

South America

Brazil

Argentina

Rest of South America

Asia-Pacific

China

India

Japan

Australia

Rest of Asia-Pacific

Middle East and Africa

Key Developments

In October 2023, Purem AAPICO, a joint venture between Eberspaecher and AAPICO Hitech, officially opened a new production plant in Rayong, Thailand, designed to manufacture exhaust systems for a major US automotive manufacturer's pick-up truck. This marks the second production site in Asia for Purem AAPICO, following the opening of a plant in Rawang, Malaysia, which will manufacture 400,000 exhaust components annually.

In May 2023, FORVIA Group's Faurecia signed a Share and Asset Purchase Agreement with Cummins to sell a portion of its commercial vehicle exhaust aftertreatment business in Europe and US. The deal, valued at EUR 142 million, is set to enhance Cummins' position in the exhaust aftertreatment market, while Faurecia focuses on other strategic areas.

In March 2021, Eaton and Tenneco announced a strategic partnership to develop an advanced integrated thermal management system aimed at helping commercial vehicles meet increasingly stringent emissions regulations. The new system provides direct heat to aftertreatment systems, enhancing their efficiency in reducing harmful exhaust emissions.

Why Purchase the Report?

To visualize the global automotive exhaust aftertreatment systems market is segmented based on component, Vehicle, fuel, sales channel and region.

Identify commercial opportunities by analyzing trends and co-development.

Excel spreadsheet containing a comprehensive dataset of the automotive exhaust aftertreatment systems market, covering all levels of segmentation.

PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.

Product mapping available as excel consisting of key products of all the major players.

The global automotive exhaust aftertreatment systems market report would provide approximately 78 tables, 72 figures and 205 pages.

Target Audience 2024

Manufacturers/ Buyers

Industry Investors/Investment Bankers

Research Professionals

Emerging Companies