Automotive Wire Harness Market Report (2024 - 2030) - Size and Share Analysis, Industry Trends, and Growth Forecasts

The global automotive wire harness market was valued at USD 47.1 billion in 2023, which is expected to grow at a CAGR of 3.2% during the forecast period (2024–2030), to reach USD 59.0 billion by 2030. The rising manufacturing of electric vehicles (EVs) and technological advancements are some of the most prominent factors leading to the market growth.

The integration of advanced features, such as high-voltage wiring harness systems and lightweight harness systems in EVs, coupled with the surging demand for autonomous passenger cars and light trucks, is expected to aid in the growth of the market in the coming years.

Additionally, the growing incorporation of innovative features in ICE-based vehicles, especially passenger cars, is driving the demand for wiring harnesses. Particularly, the increasing demand for advanced driver-assistance systems (ADAS), which include speed sensors, radar sensors, and light detection and ranging (LiDAR) sensors; autonomous driving systems; connectivity features; and various other smart features is leading to the rising demand for wire harnessing in automobiles. These features enhance the passenger experience, which is the key reason for their increasing integration.

Automotive Wire Harness Market Trends & Drivers

Innovation in Wire Harnesses Is a Key Market Trend

• The market for automotive wire harness is currently witnessing the substitution of copper-based wire harnesses with other materials.
• Many of the research and development (R&D) initiatives in the automotive industry are aimed at reducing the metal content to achieve a reduction in the weight so that the overall vehicle fuel efficiency can be raised.
• Copper and steel are currently being replaced by copper-based alloys and aluminum metal.
• Currently, various companies are replacing copper content in vehicles with copper-based alloys due to their more favorable features. It is seen that doing so reduces the copper weight by nearly 0.8 kg.
• To ensure the optimum performance of the vehicles and the correct functioning of all installed electronic systems and devices, original equipment manufacturers (OEMs) are currently focusing on developing advanced automotive wire harnesses.
• New technologies concerning environmental protection and in-vehicle comfort are being deployed in new vehicles, especially passenger cars.
• In addition, OEMs are undertaking R&D to improve the wire harness production process and reduce the weight of the overall wire harness network in a vehicle, due to the increasing demand for lightweight harnesses from automakers.

Growing EV Demand Boosts Wire Harness Needs

• The EV market has been growing exponentially over the last few years. Therefore, the increasing sales of EVs, especially battery electric vehicles (BEV), in China, the U.S., Japan, and Germany, are leading to a high demand for wire harness products.
• EVs consist of a greater number of wire harnesses, as they have more electrical units and electronic components than ICE-based vehicles.
• Moreover, apart from electricity transmission, these wires are required for the transmission of high volumes of data, due to which harnesses are more important for an EV compared to an ICE-based automobile.
• Eco-friendly wire harness solutions, such as high-voltage wire harness systems, for both hybrid and plug-in vehicles (battery and plug-in hybrid), for optimizing the overall vehicle performance, are being used globally.

Unstable Costs of Copper May Hamper the Market

• Copper is widely used in the automotive industry for manufacturing wiring harnesses. It is given priority due to its exceptional characteristics such as tiny bundle size, ease of assembly, reliability, flexibility, and high electrical conductivity.
• However, the costs of copper could be a major challenge owing to variations driven by the difference between supply and demand.
• The worldwide demand plays a crucial role since copper greatly influences its price, which leads to constant increases.
• Copper is versatile in nature and employed in different applications but several wiring harness makers use aluminum as a substitute due to its low price and lightweight.
• However, a particular termination technology is required by aluminum to combat challenges like oxidation, high thermal growth, galvanic corrosion, aging-related distortion, lower flexibility, and tensile power.
• Therefore, copper is the first preference for wiring harness applications but its variable prices can affect the businesses of makers.

In-Depth Segmentation Analysis

Vehicle Type Insights

The passenger cars category accounted for a larger market share of 60% in 2023. Passenger vehicle sales are on the rise owing to several factors like progress in road infrastructure and connectivity and surging disposable incomes of people. Also,the growing popularity of SUVs and MPVs is expected to increase the demand for car wiring kits extensively.

Whereas, the commercial vehicles category is projected to grow at a higher CAGR, of 4%, from 2024 to 2030 in the market. The growth can be attributed to the rising integration of advanced electronic modules and connectivity features, which include data transfer to smartphones and sync with Internet of Things (IoT) devices, in the vehicles.

Further, vehicle types are classified into:

• Passenger Cars (Larger Vehicle Type)
• Commercial Vehicles (Fastest-Growing Vehicle Type)

Voltage Analysis

The low voltage category is dominating the market. This is primarily owing to the increasing number of advanced electronic features, such as human–machine interface (HMI) modules, and the increasing level of autonomy in passenger cars, especially in the sedan and sports utility vehicle (SUV) categories.

On the other hand, the high voltage category is projected to record a higher CAGR during 2024–2030. This can be due to its broad applications in electric vehicles, as these vehicles consist of different high-voltage electronic modules and components like power distribution networks, electric motors, and batteries.

Below are the voltage categories:

• Low Voltage (Larger Category)
• High Voltage (Faster-Growing Category)

Propulsion Insights

The internal combustion engine (ICE) category holds a larger market share, of 80%, in 2023 and it is also expected to maintain its dominance in the forecast period.

• This is because as compared to electric vehicles (EVs), more ICE-based automobiles are manufactured and sold.
• Additionally, they are being rapidly integrated with vehicle-to-vehicle (V2V) and vehicle-to-vehicle (V2V) connectivity, as well as self-driving functionalities.
• Therefore, the importance of wire harnesses for transferring electricity and data among a vast array of electronic sensors and systems is high in ICE vehicles.

The EV category is expected to grow at a higher CAGR, of 5%, from 2024 to 2030 in the market. This is associated with the increasing penetration of electric vehicles globally. Further, these vehicles have a large number of electronic systems, which boosts the demand for wire harnesses.

Further, propulsion types are divided into:

• ICE (Larger Category)
• EV (Faster-Growing Category)

Material Assessment

The copper category holds a larger share of the market. The higher demand for copper wires led to the domination of the copper category and it is expected to retain its dominance in the coming years as well.

• Moreover, this is due to the rising demand for copper-wire harnesses, as copper has been the material of choice for wires for a long time.

The aluminum category is projected to grow at a higher CAGR during 2024–2030 in the market. This can be mainly attributed to the tightening government regulations related to vehicle overall weight.

• Governments in various areas such as the U.S. and Europe have directed all automakers to reduce vehicles’ weight and pollution generated, which thus leads to improved vehicle efficiency.
• Automakers are investing in R&D activities for developing aluminum-based wire harnesses with similar characteristics to that of copper.

During the study, we assessed two material types:

• Copper (Larger Category)
• Aluminum (Faster-Growing Category)

Application Analysis

• The chassis category is dominating the market, with a revenue share of 40% in 2023. This is because the chassis has a number of components like actuators, sensors, control units, and systems like suspension, braking, and steering. All these need electrical connections, which leads to a higher demand for wiring harnesses.
• Whereas, the speed sensors category is expected to witness faster growth, advancing at a CAGR of 4% during 2024–2030. The availability of a broad range of customized speed sensors and the rising global vehicle sales are some of the major factors driving the growth of the market in this category.

Further, the applications analyzed are listed below:

• Chassis (Largest Category)
• Engine
• Body
• HVAC
• Speed Sensors (Fastest-Growing Category)
• Others

Regional Evaluation

APAC held the largest market share, of 55%, in 2023. This is attributed to the growing production of EVs, coupled with a large consumer base for ICE-based vehicles in the region.

• Essentially, the rising demand for passenger and commercial vehicles in China, India, Japan, and South Korea leads to a huge automotive production volume, which, in turn, drives the regional market.

Whereas, the European market is expected to witness the fastest growth, propelling at a CAGR of 3.5%, from 2024 to 2030. This can be ascribed to the rising production of vehicles in the region and the presence of major automobile companies.

• Rapid urbanization and economic growth in this region are the key reasons behind the increased demand for automobiles, which consequently drive the automotive components market.

Further, the following regions and countries were analyzed for this report:

• North America
  • U.S. (Larger and Faster-Growing Country Market)
  • Canada
• Europe (Fastest-Growing Regional Market)
  • Germany (Largest Country Market)
  • U.K.
  • France (Fastest-Growing Country Market)
  • Italy
  • Spain
  • Rest of Europe
• APAC (Largest Regional Market)
  • China (Largest Country Market)
  • Japan
  • India (Fastest-Growing Country Market)
  • South Korea
  • Australia
  • Rest of APAC
• Latin America (LATAM)
  • Brazil (Largest and Fastest-Growing Country Market)
  • Mexico
  • Rest of LATAM
• Middle East and Africa (MEA)
  • Saudi Arabia
  • South Africa
  • U.A.E. (Largest and Fastest-Growing Country Market)
  • Rest of MEA

Market is Consolidated

The global market is consolidated in nature, with the top two players Yazaki Corp. and Sumitomo Electric Industries Ltd. holding a significant share. In recent years, players in the market have been actively involved in product launches and facility expansions to stay ahead of the competition.

Automotive Wire Harness Companies News

• Sumitomo Electric Wiring Systems invested around USD 10 million in producing harnesses and became the first Tier 1 automotive organization to set up its operations in Tabasco, Mexico, in May 2023.
• Dhoot Transmission and Hero Electric collaborated to achieve innovative wiring harness solutions in February 2023.
• An 85% equity stake was acquired by Aptiv PLC in Intercable Automotive Solutions from Intercable S.r.l with a deal of USD 627 million in December 2022.
• Motherson Sumi Ltd. opened its third automotive harness production facility in Serbia in September 2022.
• Eight automakers had a deal with Furukawa Electric in June 2022 to utilize its aluminum wire harnesses in 100 vehicle models by 2025 and to target European automotive makers. As the global shift is progressing towards EVs, companies will continue to develop aluminum harnesses to further reduce weight.