LONDON--(BUSINESS WIRE)--Technavio analysts forecast the global microcar market to grow at a CAGR of almost 3% during the forecast period, according to their latest report.
The research study covers the present scenario and growth prospects of the global microcar market for 2017-2021. Technavio presents a detailed picture of the market by way of study, synthesis, and summation of data from multiple sources.
The market growth is mainly affected by the increasing acceptance of small cars, rising popularity of electric cars, and multiple microcar models with advanced features launched by OEMs. OEMs have been upgrading microcar engines to achieve maximum performance output. This limitation makes microcars almost incapable of interstate transportation as the engine would be unable to handle large amounts of heat. Moreover, the increased engine temperature increases the amount of NOx produced, which creates noncompliance issues regarding vehicular emissions regulations.
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Technavio analysts highlight the following three factors that are contributing to the growth of the global microcar market:
Increased preference for affordable economic cars in APAC
Automotive markets in APAC have always been cost sensitive due to constrained spending habits, the lack of awareness regarding financial methods, and economic backwardness. Hence, the penetration of passenger cars is less in APAC compared to the Americas and Europe. Customers in APAC prefer to buy small cars as they are affordable and economical to maintain.
Praveen Kumar, a lead automotive manufacturing research analyst at Technavio, says, “The availability of car finance at competitive rates and the increase in the disposable income are the main reasons for the increase in the penetration of cars in India. There is an increase in the demand for passenger cars in the small towns and rural areas of India.”
Rising levels of road congestions and limited parking space
Emerging countries like India face issues regarding overpopulation, which further translates into the overcrowding of the nation’s cities. The increasing rates of urbanization wherein people migrate to cities in search of employment is estimated to have a significant impact on the sales of cars. People in cities are well educated and have higher spending capabilities, which enables them to buy a car.
“European nations have also been bearing the brunt of traffic congestions due to the large number of vehicles on roads. London has the largest amount of road congestion in Europe. About 110 man-hours of an average Londoner are lost waiting in road traffic blocks in a year,” adds Praveen.
Increasing rates of two-wheeler accidents
The rising number of two-wheeler accidents is estimated to drive the market for microcars. Unlike passenger cars that enclose the travelers, two-wheelers lack safety measures and leave the rider open to being easily affected by the outside elements. Hence, the risk of injury following an accident is high to a two-wheeler user than a passenger car rider.
In China and India, there are clear restrictions depending on the class of road. Advanced speed camera systems incorporated with automatic number plate recognition are used for tracking the speed and identifying such vehicles. However, the infrastructure regarding the same is available in developed economies but lagging in certain emerging economies.
Top vendors:
- Daimler
- Toyota
- General Motors
- Honda
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About Technavio
Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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