The global in-wheel motor market is characterized by the presence of many local, regional, and global vendors. The market is highly competitive, with all the players continually competing to gain a larger market share. High competition, rapid advances in technology, frequent changes in government policies, and stringent environmental regulations are some of the critical factors that could restrain the market growth. The vendors compete in terms of cost, product quality, reliability, and aftermarket services. Vendors must provide cost-effective and efficient products to survive and succeed in a competitive market environment.
The growth of the vendors is dependent on market conditions, government support, and industrial development. Thus, the vendors should focus on expanding their presence and improving their services. Protean Electric, NTN, NSK, Printed Motor Works, and Elaphe Ltd. are some of the key players operating in the global market. These companies compete in terms of availability, quality, price, and technology and consider expansion and product development, as their key strategies in the global in-wheel motor market. Although the international players dominate the market, regional and local players with small market shares also have a significant presence. The international players may strengthen their presence in the global market by heavily investing in product development during the forecast period.
Threat of New Entrants
The in-wheel motor industry is highly capital intensive, and the level of technical expertise required for in-wheel motor development and manufacturing is highly specific. The presence of well-known in-wheel motor companies such as Protean Electric, NTN, NSK, and Elaphe Ltd. in the in-wheel motor market and their strong brand recognition make it difficult for new entrants to create brand value and achieve economies of scale. Moreover, the established companies are manufacturing in-wheel motors with high-quality materials and advanced technologies. The high manufacturing standards applied to their manufacturing processes give them a competitive advantage over new entrants. Thus, the threat of new entrants in the global in-wheel motor market is expected to be low to moderate during the forecast period.
Bargaining Power of Suppliers
The in-wheel motor manufacturers procure both raw materials and components from suppliers. The raw materials include silicon steel, copper, and aluminum, while the components include rotors, stators, and protective cover. There is a large number of suppliers for raw materials such as steel in the global market. The availability of component suppliers is limited as the components are to be produced while maintaining the highest manufacturing standards to achieve the required working efficiency in the end-use applications.
Major in-wheel motor manufacturers procure these raw materials and components in very high quantities, which reduces the bargaining power of suppliers up to a certain extent. However, the in-wheel motor manufacturing companies cannot easily switch suppliers due to the risks involved in not getting the required quantity and quality of materials and components from new suppliers, on time, which increases the switching cost. Hence, these manufacturers tend to have long-term contracts with their suppliers. Thus, the bargaining power of suppliers in the global in-wheel motor market is expected to be moderate during the forecast period.
Threat of Substitutes
There are no close substitutes for the in-wheel motors. In-wheel motors are irreplaceable in electric vehicles as they ensure high reliability and feasibility in vehicle operations. Hence, the market players do not face much threat from substitutes. Thus, the threat of substitutes is low.
Bargaining Power of Buyers
In-wheel motor buyers include individual buyers, fleet owners, and distributors. The number of buyers of in-wheel motors is moderate as the awareness regarding the benefits of electric vehicles is moderate. The buyers generally depend on the existing providers as the switching cost and the risks associated with the product quality, technical specifications, replacement, and aftermarket services of new in-wheel motor manufacturers are high. Thus, the overall power of buyers in the global in-wheel motor market is expected to be moderate during the forecast period.
Intensity of Rivalry
Product differentiation within the global in-wheel motor market is very high. This is because the in-wheel motor manufacturing companies are developing various materials, technologies, and product designs according to the requirements of the end users to improve their performance and technical capabilities. Hence, they are investing in extensive research & development of electric systems. The low to moderate threat of new entrants, low threat of substitutes, moderate bargaining power of buyers, and moderate bargaining power of suppliers contribute to the high intensity of rivalry in the global in-wheel motor market during the forecast period.
