The HCVs in the automotive switch market are expected to witness around 3.5% growth during the forecast period. The rising demand for comfort features and enhancing the driving experience and performance will accelerate the demand for various automotive electronics such as HVAC and infotainment systems. This will eventually accelerate the demand for automotive switches in commercial and mid-range vehicles.
The growth in farm mechanism in the agriculture industry majorly in developing countries is increasing the market share for HCVs and is growing at a CAGR of 5%. These farm mechanism techniques are widely adopted in Asia Pacific, majorly in China and India, due to various government schemes and engagement of rural organizations in farming. The growing advancement in agriculture tractors will propel the market opportunity for automotive switches.
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Multi-function automotive switch is the fastest-growing segment with a CAGR of 5% through 2026 due to rising demand for steering wheels. The combination or multi-function switches can perform various functions such as wiper system, lighting system, cruise control, and others, thereby increasing their market opportunity in luxury vehicles.
Luxury car models implemented with multi-function switches include Mercedes-Benz S-Class, Audi A3, BMW 3ER, Porsche Macan, and others. Manufacturers in the market are continuously implementing these switch systems in their models to enhance the interior and offer more comfort to the driver. For example, in July 2019, Porsche launched Macan S in India that features a three-spoke multi-function steering wheel to offer improved control and stability features.
Indicator system switches help the driver as well as other vehicles on the road for the change in direction and avoid the chances of collision. These switches are used as the most common safety function available in all types of vehicles including two wheelers and held an automotive switch market share of 4% in 2019.
The growing market trend toward road safety will propel the demand for indicator system switches among OEMs and add an advantage for automotive switches. Several government regulations regarding the installation of lightning and electronic equipment will spur the demand for indicator systems in vehicles. For example, in April 2018, the United Nations introduced a regulation for the installation of lighting and light signaling devices.
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Europe accounts for around 20% of the automotive switch market share with estimated gains of over 3.5% through 2026 owing to presence of several leading luxury car manufacturers such as Daimler AG, Audi, and Porsche. The rising demand for modern mobility solutions to offer enhanced safety & comfort features in newly developed luxury, passenger, and commercial vehicles in the region will drive the market growth.
The rising production of light commercial vehicles in the UK will increase the growth opportunities for market players in automotive switches. These vehicles nowadays are implemented with various advanced features, such as infotainment and electronic system switches, which will increase the demand for automotive switches in the region.
According to the Society of Motor Manufacturers and Traders (SMMT), commercial vehicle production in the UK has increased by 9.8% and reached 8,768 units in 2019 in comparison with 7,983 units produced in 2018.