Global Turbocharger Market (by Engine Type, Technology, Distribution Channel, Vertical, & Region): Insights and Forecast with Potential Impact of COVID-19 (2022-2027)

A turbocharger is a device that is installed in the engine of a vehicle to improve overall economy and performance. In a combustion engine, air, fuel, and spark combine to produce an explosion that generates power to spin the engine.

Because of the increasing application of rigorous automobile pollution requirements across the world, Original Equipment Manufacturers (OEMs) are utilizing engine-downsizing tactics to optimise vehicle fuel economy. This trend is likely to drive demand for turbochargers since they play an important role in reducing vehicle emissions and improving fuel economy throughout the forecasted years. The global turbocharger market is projected to reach US$18.67 billion in 2023, growing at a CAGR of 6.90% over the projected period.

Segment Covered

By Engine Type: In terms of engine type, the report offers insights of the global turbocharger market into five segments: gasoline, diesel and hybrid. The gasoline segment held a major share in the market. On the other hand, the hybrid segment is expected to grow at a significant CAGR in the forthcoming years owing to the increasing trend of emission reduction along with increased engine economy.

By Technology: On the basis of technology, the report provides the bifurcation of the market into four segments: Variable geometry technology, twin turbo technology, wastegate technology and others. The variable geometry technology segment held highest share in the market. This was being followed by twin turbo technology segment. Emission regulations across the globe have generated demand for downsized and down-speeded turbocharging systems for application in small and medium-sized vehicles. This factor has increasingly endorsed the preference for variable geometry technology in turbochargers.

By Distribution Channel: The report provides the bifurcation of the market into two segments according to the distribution channel: original equipment manufacturer and aftermarket. The original equipment manufacturer segment held a major share in the market. This was being followed by aftermarket segment. Original equipment manufacturers (OEMs) are implementing engine-downsizing tactics to maximize vehicle fuel efficiency as a result of the increasing adoption of rigorous automobile emission standards around the world. The large scale production of vehicles in different categories such as commercial and passenger vehicles with increasing emphasis on fuel efficiency is expected to aid the growth of original equipment manufacturer segment.

By Vertical: The report provides the bifurcation of the market into four segments based on the vertical: aerospace & defense, automotive, marine and agriculture & construction. The aerospace & defense segment held the largest share of in the market. This was being followed by automotive segment. Turbochargers used in aviation increases the density of the intake gas, allowing for more power. Factors such as increase in air passenger traffic across the globe, surge in demand for fuel-efficient and downsized engine and increased public investment in defense aircrafts by nations across the world are expected to propel the aircraft and defense turbocharger market in the coming years.

Geographic Coverage

According to this report, the global turbocharger market can be divided into four regions, namely North America, Europe, Asia Pacific, and Latin America, Middle East & Africa (LAMEA). The countries covered in North America region are the US, Mexico, Canada, while Europe includes UK, Germany, France and Rest of Europe. Moreover, China, Japan, India, South Korea and Rest of Asia Pacific are included in the Asia Pacific region. Asia Pacific held the maximum share in the market, owing to increasing per capita income and stringent government regulations in this region. Within North America, the US is leading the market, due to increasing awareness about technology and emission regulations. Whereas, in the Europe region, Germany is dominating the market due to strict pollution control rules and restrictions on high emissions.

Top Impacting Factors

Growth Drivers

• Increasing Per Capita Income
• Improved Engine Performance
• Increasing Penetration of Turbochargers in Diesel Vehicles
• Improved Fuel Efficiency

Challenges

• Turbocharger Installation & High Maintenance Costs

Trends

• Variable Geometry Turbocharging
• Next Generation Technologies
• Increasing Adoption of Electric Turbochargers

Driver: Improved Engine Performance

Turbochargers can make significant contributions to overall engine performance. A turbocharger turbine converts thermal energy from exhausted gas to mechanical energy and drives the compressor. The compressor increases the air pressure before the air enters into the engine intake manifold and increases the air mass flow entering the cylinders. Turbochargers can enhance the output of an internal combustion engine without increasing the cylinder capacity and make it possible to downsize the engine. Turbocharger provides a feasible engineering solution to engine economics and emission reductions. For achieving emission and fuel consumption reductions, all potential areas of improvement must be identified for both core engines and turbochargers. Developments of the new diesel engines are undergoing rapid transformation due to emission regulations and fuel efficiency. Thus, owing to increasing advantages of turbocharger installations in motor vehicles, the market has been witnessing growth over past years which is anticipated to continue further in the coming years.

Challenge: Turbocharger Installation & High Maintenance Costs

The turbocharger market shows very impressive growth rate for the future. However, there are still some technology related issues with turbochargers that limit its market growth. Installation is a crucial factor in the effective working of a turbocharger, so if there is any mistake during the installation of a turbocharger, it not only makes the turbocharger ineffective, but also harms the engine. Hence, compatibility of turbochargers with engines is an issue that needs serious observation. Turbocharger replacement is also costly. Turbochargers with poor maintenance might fail prematurely, increasing the load on the engine cooling oil. As a result of the cooling oil required, TGDI (turbocharged gasoline direct injection) engines have high maintenance costs.

Trend: Next Generation Technologies

According to the IEA, longer-term out to 2050, the biggest opportunities include advanced batteries, hydrogen electrolyzers, and direct air capture/storage. Build out of these technologies includes new pipelines to transport captured emissions and systems to move hydrogen between ports and industrial zones. To do this, government R&D spending needs to increased and be reallocated. Critical areas include electrification, hydrogen, bio-energy and carbon capture / utilisation / storage (CCU). However, collectively, these areas only receive 1/3rd of public R&D funding of the more established low-carbon electricity generation and energy efficiency technologies. cUS$90bn in public money needs to be mobilized globally. The International Energy Agency (IEA) forecasts a significant shift to renewables and natural gas in all three of its case scenarios. With a move to renewables, the world needs more balancing power and turbochargers could play a role here and its base is diversified beyond power plant applications to include industrial customers.

The COVID-19 Analysis

The novel coronavirus pandemic and the resulting lockdowns have negatively impacted numerous manufacturing and service industries by hampering both the supply-side and demand-side supply chains. The turbocharger market, too, was affected greatly due to the pandemic and lockdowns. The virtual halt on the manufacturing of automobiles during the pandemic drastically brought down the supply of the vehicles, while the travel restrictions brought down the demand for automobiles. This dual shock faced by the automobile industry, in turn, negatively affected the turbocharger market during the pandemic. Automobile companies have been bearing the brunt of the coronavirus pandemic. New wave in India, China, and the U.K. is compelling stakeholders in the turbocharger market to adopt contingency planning in order to tide over business uncertainties.

Analysis of Key Players

The turbocharger market is consolidated market, where, Garrett Motion, Borgwarner and IHI are major market players. The key players in the global turbocharger market are Eaton Corporation plc, ABB GroupMondi plc, Cummins Inc., BorgWarner Inc., Wabtec Corporation (Precision And Turbo Inc.), Cardone (Rotomaster), Mitsubishi Heavy Industries Ltd., IHI Corporation, Continental AG, Garrett Motion Inc., FountainVest Partners (Bosch Mahle Turbo Systems), and Turbo Dynamics Limited.