Automotive Transmission Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2025-2034)

The global automotive transmission market size reached approximately USD 138.91 Billion in 2024 and is expected to grow at a CAGR of 6.30% from 2025 to 2034, reaching USD 255.90 Billion by 2034. The growing demand for automotive transmission technology, especially advanced transmission technologies such as Dual-Clutch Transmissions (DCT) and Continuously Variable Transmissions (CVT), is driving this growth. These innovations contribute to improved vehicle performance, fuel efficiency, and enhanced engine performance. As emission regulations become stricter, automotive manufacturers are focusing on transmission solutions that help reduce greenhouse gas emissions. The continued development of automotive transmission technologies is crucial in meeting these demands and maintaining compliance with global emission standards, further shaping the future of the automotive transmission market.

Automotive Transmission Market Trends

The automotive transmission market is experiencing significant growth, driven by the increasing demand for automatic transmissions in passenger vehicles. Automatic transmissions, known for their convenience and ease of use, are becoming more popular compared to manual gear changes. As automatic transmission systems continue to evolve, they offer improved efficiency, smoother driving experiences, and enhanced fuel economy. The shift towards automatic transmissions in the automotive sector reflects changing consumer preferences, with manufacturers focusing on integrating advanced automatic transmission systems to meet the growing demand in the market.

The automotive transmission market is evolving due to the rise of electric vehicles (EVs) and hybrid vehicles. As the automotive transmission landscape shifts, the demand for advanced transmission systems is growing, particularly with the electrification of vehicles. EVs and hybrids require specialised transmission solutions to optimise energy efficiency and battery technology. This shift supports sustainability efforts by reducing emissions and improving fuel consumption. With the focus on energy efficiency, the automotive transmission market is adapting to meet the changing needs of modern vehicles, driven by advances in both transmission and battery technology. In August 2024, The 2024 Citroen C3 launched with new features, including six airbags, LED headlights, and a digital instrument console. It now offers an automatic transmission option, replacing previous halogen lights with LED projectors and introducing a 6-speed automatic torque converter.

Transmission Insights

Manual transmission offers greater control over gear shifts, allowing drivers to optimise engine performance and fuel efficiency. It typically results in lower purchase and maintenance costs compared to automatic systems. Manual transmissions also tend to be more durable and offer a more engaging driving experience, making them popular in regions with a strong preference for driving precision. In March 2025, Lexus launched its RZ battery electric SUV, introducing innovations like steer-by-wire and Interactive Manual Drive for virtual manual gear shifting. The company reaffirmed its leadership in BEV technology within Toyota, with plans to debut three new BEVs over the next year.

Automatic transmissions offer several key benefits in the global automotive transmission market. They provide a smoother and more convenient driving experience, particularly in heavy traffic, by eliminating the need for manual gear shifting. This ease of use makes them popular among drivers of all skill levels. Modern automatic systems, including CVT and DCT, optimise fuel efficiency, reduce emissions, and enhance vehicle performance. They deliver smoother acceleration, better power delivery, and improved fuel economy compared to older manual systems. Additionally, automatic transmissions are increasingly integrated with advanced technologies, contributing to reduced environmental impact and meeting stringent global emission regulations.

Fuel Insights

Gasoline engines are widely preferred in the global automotive transmission market due to their smooth operation and quieter performance compared to diesel engines. They are typically more affordable to purchase and maintain, making them a popular choice for personal vehicles. Gasoline engines offer quick acceleration and are ideal for urban and suburban driving, where short trips are common. They produce lower levels of nitrogen oxides (NOx) and particulate matter compared to diesel engines, making them a more environmentally friendly option in many markets. With continued advancements in fuel efficiency and emissions control, gasoline engines remain a dominant choice in passenger vehicles.

Diesel engines are renowned for their fuel efficiency and longevity, making them highly advantageous in the global automotive transmission market, particularly for long-distance driving. Diesel engines offer greater torque, providing superior towing capacity and performance on highways, making them ideal for commercial and heavy-duty vehicles. In January 2025, Skoda India reintroduced diesel engines after a five-year gap, showcasing the new-generation Superb 4X4 with a 2.0 diesel engine. The decision was based on customer demand, as 80% of Skoda's earlier sales were diesel. This move follows the success of diesel in other brands like Hyundai and BMW, offering benefits in fuel efficiency and CO2 emissions.

Vehicle Insights

Light Commercial Vehicles (LCVs) are highly valued in the global automotive transmission market for their versatility, fuel efficiency, and cost-effectiveness. LCVs are ideal for small businesses, urban deliveries, and transporting goods over short distances. Their smaller size compared to HCVs allows better manoeuvrability and lower operational costs, making them a popular choice in emerging markets. Registrations of new energy LCVs surged in 2023, reaching 242,000 units, marking a 46.4% increase compared to 2022, the highest growth among all commercial vehicle categories. Consequently, new energy LCV sales accounted for 78.4% of total new energy commercial vehicle sales in China in 2023.

Heavy Commercial Vehicles (HCVs) play a critical role in the global automotive transmission market due to their superior capacity for transporting large loads over long distances. HCVs, such as trucks and articulated lorries, are designed to provide high torque and durability, essential for carrying heavy cargo. Their transmissions are engineered to handle intense stress and deliver consistent performance. Although more expensive to purchase and maintain, HCVs offer significant long-term benefits through increased productivity and reduced cost per unit transported. With advancements in fuel efficiency and emission reduction technologies, HCVs continue to evolve, supporting industries like logistics and construction in meeting growing demand worldwide.

Regional Insights

The North American automotive transmission market is driven by a strong preference for automatic transmissions, with consumers increasingly seeking ease of use and comfort. The rise in demand for electric and hybrid vehicles has also influenced transmission technology, with manufacturers focusing on more efficient and sustainable systems. Additionally, stricter emission standards in the region are pushing automakers to innovate and develop transmission solutions that enhance vehicle performance while reducing environmental impact. As electric vehicles gain traction, transmission systems such as single-speed gearboxes are becoming more prevalent in North America's automotive sector.

U.S. Automotive Transmission Market Trends

In the U.S., the automotive transmission market has seen a shift towards automatic transmissions, driven by consumer demand for convenience and ease of use. The growing popularity of electric vehicles (EVs) and hybrid vehicles is also influencing transmission technology trends. Manufacturers are focusing on enhancing fuel efficiency and reducing emissions, leading to an increase in the development of advanced transmission systems. In late 2023, ZF began producing PowerLine 8-speed automatic transmissions at its Gray Court facility in South Carolina, marking a USD 200 million investment. This modular transmission, designed for hybrid and conventional commercial vehicles, improves fuel economy and acceleration while supporting CO2 reduction goals.

Europe Automotive Transmission Market Trends

In Europe, the automotive transmission market is experiencing a strong focus on fuel efficiency and environmental sustainability. The growing demand for electric vehicles (EVs) has led to the development of new transmission technologies that cater to these vehicles, such as single-speed gearboxes. There is also a notable rise in the adoption of dual-clutch transmissions (DCTs) and continuously variable transmissions (CVTs) in passenger vehicles, providing smoother driving experiences and better fuel economy. Furthermore, European regulations on emissions are shaping the market, driving automakers to focus on energy-efficient transmissions that align with the region’s strict environmental standards.

Asia Pacific Automotive Transmission Market Trends

The Asia Pacific automotive transmission market is witnessing significant growth, driven by strong demand from countries like China, Japan, and South Korea. The shift towards more energy-efficient and sustainable solutions has led to an increased focus on electric vehicle (EV) transmission technologies. China is leading the way in the adoption of new energy vehicles (NEVs), including battery electric vehicles (BEVs) and hybrid vehicles, which are transforming transmission requirements. In FY23, India produced 25.9 million vehicles, with strong domestic demand and export growth. In December 2024, production of passenger vehicles, three-wheelers, two-wheelers, and quadricycles reached 1,921,268 units. Total automobile exports from India in FY23 were 4,761,487 vehicles.

India's automotive transmission market is witnessing significant changes as consumer demand for fuel-efficient vehicles grows. The market is experiencing a shift towards automatic transmissions, particularly in urban areas, where ease of use and convenience are paramount. The rise of electric vehicles (EVs) is also influencing the transmission landscape, with manufacturers developing more sophisticated technologies for EVs. As the Indian government pushes for stricter emission norms, automakers are focusing on improving transmission efficiency to meet these regulations. Additionally, there is growing interest in hybrid vehicles, which combine conventional transmissions with electric powertrains, offering a solution to India’s growing need for eco-friendly vehicles.

Key Automotive Transmission Company Insights

Some prominent companies in the automotive transmission market include AISIN CORPORATION, Allison Transmission, Inc., BorgWarner Inc., and Continental AG. These firms are focused on expanding their market presence and securing a competitive advantage through strategies such as mergers, acquisitions, and partnerships with other key industry players.

AISIN CORPORATION

AISIN CORPORATION is well-known for its innovative automotive products, including transmissions, braking systems, and engine components, serving both traditional and electric vehicles. The company incorporates advanced technologies into its offerings, improving vehicle performance, safety, and efficiency, while prioritising sustainability and reliability to meet the demands of the global automotive market.

Allison Transmission, Inc.

Allison Transmission, Inc. is a leading provider of fully automatic transmissions and hybrid propulsion systems for commercial and military vehicles. Specialising in driveline solutions, the company enhances vehicle performance, reliability, and fuel efficiency, serving sectors such as construction, transportation, and defence. Through its innovative technologies, Allison Transmission continues to meet the evolving needs of its international customer base.

BorgWarner Inc.

BorgWarner is a global leader in automotive propulsion technologies, specializing in advanced powertrain solutions, including transmissions, turbochargers, and electric vehicle components. The company focuses on enhancing vehicle performance, fuel efficiency, and sustainability. BorgWarner partners with major automakers worldwide, offering cutting-edge solutions for both internal combustion and electric vehicles, contributing to cleaner, more efficient transportation.

Continental AG

Continental AG is a leading supplier of automotive technologies, including braking systems, tyres, and transmission components. The company is dedicated to advancing mobility with a focus on safety, efficiency, and sustainability. Continental’s innovative solutions support both traditional and electric vehicles, with a strong emphasis on developing future-proof technologies to meet the evolving needs of the global automotive industry.

Magna International Inc.

Magna International Inc. is a leading motor vehicle manufacturing company, producing automotive components, systems, modules, and assemblies for Ford, Mercedes, BMW, General Motors, Tesla, and Toyota, among others. The company was founded in 1957 and is headquartered in Ontario, Canada.

Key Automotive Transmission Companies

• Magna International Inc.
• Aisin Corporation
• BorgWarner Inc.
• Continental AG
• Eaton Corporation plc
• Schaeffler AG
• ZF Friedrichshafen AG
• Allison Transmission, Inc.
• JATCO Ltd.
• Dana Incorporated
• Aichi Machine Industry Co., Ltd.
• GKN Automotive Limited (Dowlais Group plc)
• Others
• Recent Development
• In March 2025, The JETOUR T1, an urban lite off-road SUV, launched to positive market feedback, combining style, performance, and comfort. Powered by a 2.0T engine and featuring an 8AT and XWD intelligent four-wheel-drive system, it excels off-road. Customers praised its driving experience, fuel efficiency, and adaptability to various terrains.
• In February 2025, Stellantis announced plans to produce hybrid vehicle parts, including dual-clutch transmissions (eDCT), at its Termoli plant in Italy starting in 2026. The plant, originally set for EV battery production, will help expand Stellantis’ hybrid line. The company also plans to increase production in Metz and Sint Truiden.
• In November 2024, Tata Motors launched its first Automated Manual Transmission (AMT) truck, the Prima 4440.S AMT, in Saudi Arabia at the HEAT show in Dammam. The truck featured advanced technology for improved fuel efficiency, driver comfort, and performance. Tata also showcased five other high-performance vehicles tailored to local needs.
• In May 2024, Maruti Suzuki launched the fourth-generation Swift in India, starting at INR 6.49 lakh. It features a new 1.2-litre petrol engine, enhanced exterior design, updated cabin, and advanced tech, including a 9-inch touchscreen and connected car features. The car offers improved fuel efficiency, safety features, and two accessory packages.
• In February 2024, Tata Motors launched India’s first AMT CNG cars, the Tiago and Tigor iCNG, offering impressive mileage of 28.06 km/kg. Prices started at INR 7.89 lakh for Tiago iCNG and INR 8.84 lakh for Tigor iCNG. The company aims to boost demand with these intelligent, safe, and powerful vehicles in the growing CNG market.

Global Automotive Transmission Market Report Segmentation

The global automotive transmission market has experienced significant growth, driven by advancements in technology and increasing demand for fuel-efficient vehicles. With the rise of electric vehicles and the development of automated manual transmissions (AMTs), the market has witnessed a shift towards more efficient, reliable, and cost-effective transmission systems across various vehicle segments.

Transmission Outlook (Revenue, Billion, 2025-2034)

• Manual Transmission
• Automatic Transmission
• Continuously Variable Transmission (CVT)
• Semi-Automatic Transmission
• Others

Fuel Outlook (Revenue, Billion, 2025-2034)

• Petrol
• Diesel
• CNG
• Gasoline
• Others

Vehicle Outlook (Revenue, Billion, 2025-2034)

• Passenger Cars
• Light Commercial Vehicles
• Heavy Commercial Vehicles

Region Outlook (Revenue, Billion, 2025-2034)

• North America
• United States of America
• Canada
• Europe
• United Kingdom
• Germany
• France
• Italy
• Others
• Asia Pacific
• China
• Japan
• India
• ASEAN
• Australia
• Others
• Latin America
• Brazil
• Argentina
• Mexico
• Others
• Middle East and Africa
• Saudi Arabia
• United Arab Emirates
• Nigeria
• South Africa
• Others