LONDON--(BUSINESS WIRE)--Technavio analysts forecast the global computational fluid dynamics (CFD) market in the automotive industry to grow at a CAGR of almost 10% during the forecast period, according to their latest report.
The research study covers the present scenario and growth prospects of the global CFD market in the automotive industry for 2017-2021. The study considers revenue generated from sales of CFD software licenses and services to determine the market size.
The global CFD market in the automotive industry occupies a majority share of 70% in the global CFD market, which is its parent market. The global CFD market in the automotive industry is forecast to be valued at USD 609.4 million by 2021, with maximum incremental growth originating from EMEA. In the automotive industry, CFD is used in the research and manufacture of passenger cars, light commercial vehicles (LCVs), buses and coaches, and electric vehicles (EVs).
Geographically, EMEA leads the market with a share of 37.12% (2016 figures). The most important contributors from this region are Germany and France, where internationally acclaimed automotive manufacturers like Renault, Audi, and BMW are set up. EMEA is followed by the Americas and APAC.
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Technavio analysts highlight the following three factors that are contributing to the growth of the global CFD market in the automotive industry:
- Need to reduce product development cycle time and cost
- Increased product recalls in automotive industry
- Increase in demand for cloud CFD to convert CAPEX to OPEX
Need to reduce product development cycle time and cost
The product development cycle includes planning, designing, realization, and service stages. Automotive manufacturers are under high pressure to reduce the time a product spends in development. Reduced product development cycle times means a quicker release of the manufactured automotive to the market, which helps the manufacturers to gain an early foothold in the competitive market landscape.
“CFD is mainly used in the designing stage of the product development cycle. Vendors utilize software such as computer aided engineering to carry out the simulation and optimization processes, which reduces time spent in manual design and testing. The designing stage is a crucial stage in the product development lifecycle, which can greatly help reduce the time and cost of production of automotive products and components,” says Amrita Choudhury, one of the lead market analysts at Technavio for product lifecycle management research.
Increased product recalls in automotive industry
The increasing number of product recalls from major automotive manufacturers are driving the adoption of CFD software testing in the product development lifecycle. In 2015 and 2016, major automotive manufacturers recalled millions of vehicles for a variety of reasons. Some of the biggest recalls were due to faults in airbag inflators, braking systems, relay systems, door latches, ignition switch parts, and camshafts.
Such recalls do not stand well with the customers and impact negatively on the company reputation. The companies also lose revenue in the form of free product replacements and lawsuits. Therefore, a majority of the manufacturers are making effective use of product lifecycle management (PLM) software like computer-aided designing (CAD), CFD, and computer-aided manufacturing (CAM) to refine and optimize product designs. This has greatly helped reduce the number of product recalls, thereby driving the CFD market in the automotive industry.
Increase in demand for cloud CFD to convert CAPEX to OPEX
“The transformation of capital expenditure to operational expense is crucial for many organizations. The advantages of cloud CFD are helping companies in achieving this goal. Easy and quick availability, scalability, unlimited storage, and on-demand features are some of the advantages of the cloud. Additionally, any basic and average IT infrastructure with a pay-per-use web-based CFD software becomes a suitable option for niche companies and start-ups,” says Amrita.
Another major benefit of the operational expenditure (OPEX) model is that the company is not bound by commitments. In an OPEX business model, the end-user has the freedom to switch CFD software providers, if they are not satisfied with the quality of service provided, which is not possible with a capital expenditure (CAPEX) business model. This factor is fueling the growth of small CFD software providers in the CFD market for the automotive industry.
Browse Related Reports:
- Global CFD Market in Aerospace and Defense Industry 2016-2020
- Global Computer-aided Engineering Market for Value-added Resellers 2016-2020
- Global CFD Market 2016-2020
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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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