Flexibility necessary for European brake market players

While the European financial fug continues, brake suppliers are being required to show greater flexibility in their operations. The reactions of brands operating in the sector are shown in this feature to include a drive towards internationalisation – particularly with performance products generating improved revenues in the Americas and Asia Pacific – and a more varied product line-up to suit both OEM and end-user requirements. A new report published by Markets and Markets suggests that the global brake market will “grow to $28,532 million by 2018, as compared to $20,210 million in 2013, with a CAGR of 7.14% from 2013 to 2018. During this period of flux, the report suggests drum brakes will occupy the major share when compared to disc brakes systems, but that demand for discs will increase at a faster rate and slowly surpass the drum brakes market.

Disc systems’ advantages include addressing growing vehicle and passenger safety concerns, and more stringent environmental and safety regulations. Disc brake technology has better heat dissipation efficacy, is more lightweight, more effective in all-weather conditions and reduced stopping distance, with not much additional cost. Penetration of disc brakes in the commercial vehicle segments is limited to Europe alone, while other regions prefer disc brakes in the passenger vehicle segment only.

Mature European markets’ shift towards pad and disc technology has been tempered somewhat by the popularity of cheaper drum and shoe systems in less developed eastern European regions, while some UK suppliers have reported short-term growth in demand for the latter system on smaller, cheaper cars. Overall though, the switch to smaller vehicles to benefit from improved efficiency has led to older cars being removed from the market, reducing aftermarket demand for the older brake technology. The report suggests that the drum/shoe market will have contracted by around eight per cent in the leading five countries by 2015, offset largely by an anticipated rise in the need for brake pads and discs to replace them. As a result, suppliers of drums and shoes could consider product diversification while brake pad and disc manufacturers address increased production capacity challenges.

In 2013, the report estimates the Asia-Pacific Region to be the largest market for automotive brakes and will remain top consumer till the year 2018, while Europe and North America take the next two places. Demand for automotive brakes in the Asia-Pacific and North American regions is estimated to grow at faster rates than in the European region over the next five years, making European supplier internationalisation seem a particularly sound strategy. 

The full report is available from Markets and Markets.