The rising demand for passenger vehicles has helped growth for steering systems in China, thus boosting advanced technologies like electronic power steering (EPS) systems, according to a recent report by Frost & Sullivan.
The Chinese steering systems markets had revenue of $563.3 million in 2005 with expectations of $1.2 billion in 2012, the research shows.
“Anticipating the promising future of advanced technologies such as EPS, more suppliers will start its mass production in China,” said Frost & Sullivan analyst Arden Dai. “Backed by foreign assistance, some suppliers have already mastered the design and development of this technology even as a supply chain will soon be available.”
The adoption of the EPS systems will be hampered by the high cost of the system, including column electronic power steering systems (CEPS), pinion electric power steering systems (PEPS) and rack electric power steering systems (REPS), the report notes.
“The lack of a complete and mature supply chain will pose another hurdle to the more widespread adoption of EPS,” said Dai. “For instance, the ECU and torque sensor developed by local suppliers is still immature and is mainly dependent on imported products, which ultimately increase system costs.”
The move from mainstream manual steering (MS) and hydraulic power steering (HPS) technologies to newer systems like EPS carries growth potential for current and new suppliers, as well as system and component suppliers, the report adds.
“The expected localization of new steering technology opens a window for component suppliers in China,” Dai notes. “Moreover, the localization of EPS technology and increased production volumes could bring down prices in the next three to five years.”