Mexico Automotive EPS Market by Type (Column-Assist EPS (C-EPS), Pinion-Assist EPS (P-EPS), Rack-Assist EPS (R-EPS), Dual Pinion EPS), Vehicle Type (Passenger Cars, Commercial Vehicles), Sales Channel (OEM, Aftermarket), & Region for 2024-2031

Mexico Automotive EPS Market Valuation — 2024-2031

The Mexico automotive electric power steering market is driven upward by increasing vehicle production, growing demand for fuel-efficient vehicles, and rising adoption of electric vehicles. According to the analyst from Verified Market Research, the Mexico automotive electric power steering market is estimated to reach a valuation of USD 1.50 Billion by 2031 over the forecast subjugating around USD 1.09 Billion valued in 2024.

The rapid expansion of the automotive EPS market is propelled by the increasing focus on vehicle electrification and the growing preference for advanced driver assistance systems (ADAS). It enables the market to grow at a CAGR of 9.2% from 2024 to 2031.

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Mexico Automotive EPS Market: Definition/Overview

Electric Power Steering (EPS) is defined as an advanced steering system that is utilized to replace traditional hydraulic power steering systems. The system is powered by an electric motor that is controlled by an electronic control unit (ECU), which is used to assist the driver in steering the vehicle.

Furthermore, EPS systems are recognized for their ability to reduce fuel consumption, minimize maintenance requirements, and enhance the overall driving experience. The technology is integrated with various vehicle safety systems and is considered essential for the development of autonomous driving capabilities.

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How Does Growing Automotive Production Base Influence Mexico’s Automotive EPS Market?

Mexico’s robust automotive manufacturing sector continues to expand. According to data from the Mexican Automotive Industry Association (AMIA), Mexico produced over 3.5 million vehicles in 2022, ranking as the 7th largest automobile producer globally. The National Auto Parts Industry (INA) reported that Mexico’s auto parts production reached $94.7 billion in 2021, with steering systems accounting for approximately 8% of this value.

Mexico’s alignment with international safety standards has boosted EPS adoption. The Mexican Official Standard NOM-194-SCFI-2015 mandates enhanced vehicle safety features, including advanced steering systems. According to INEGI (National Institute of Statistics and Geography), 85% of new vehicles sold in Mexico in 2022 were equipped with EPS systems, compared to 65% in 2018.

Furthermore, the automotive sector attracts significant FDI, boosting EPS manufacturing. The Mexican Ministry of Economy reported that the automotive sector received $5.6 billion in FDI during 2021, with 23% specifically directed towards automotive components including steering systems. The Secretary of Economy projects this investment to grow by 15% annually through 2025, particularly in high-tech automotive components.

What are the Factors Hindering the Growth of the Automotive EPS Market?

One of the main challenges facing the widespread adoption of EPS technology is the higher initial cost compared to traditional hydraulic steering systems. The components and technology behind EPS, such as electric motors, sensors, and control systems, are generally more expensive to manufacture and integrate into vehicles. According to the Society of Automotive Engineers (SAE), while EPS reduces long-term maintenance costs, the upfront expense remains a significant barrier, particularly for smaller and economy vehicles, which are more cost-sensitive.

EPS systems are more complex to design and integrate than traditional hydraulic systems, requiring specialized electronic control units and software to manage the steering system’s response. This complexity increases the difficulty of retrofitting EPS systems in existing vehicle models, especially in markets where low-cost vehicle production is a priority. As per reports from the International Journal of Automotive Technology, the need for precise calibration and the integration of various sensors and motors be time-consuming and costly for manufacturers, leading to slower adoption rates in certain regions.

Furthermore, despite the increasing adoption of EPS in the automotive sector, many consumers remain unfamiliar with the technology and its benefits. This lack of awareness, combined with a traditional preference for hydraulic systems in some markets, slows down the growth potential of EPS. Furthermore, concerns over the reliability and performance of EPS systems, especially under extreme conditions, deter consumers. The National Highway Traffic Safety Administration (NHTSA) notes that while EPS systems are reliable, some consumers still associate traditional systems with a higher level of trust and durability.

Category-Wise Insights

What are the Factors that Contribute to the Column-Assist EPS Segment’s Dominance?

According to VMR analysis, the Column-Assist EPS (C-EPS) segment is estimated to dominate the market in the type category throughout the forecast period. Column-assist EPS provides a more refined steering experience, offering improved feedback and precision compared to other EPS types. This system, typically found in compact vehicles, allows for more responsive steering while maintaining a compact design. According to the European Automotive Manufacturers Association (ACEA), EPS systems are preferred in smaller vehicles due to their lightweight and ability to provide accurate and responsive handling, which enhances the overall driving experience.

Column-assist EPS contributes to improved fuel efficiency and reduced vehicle weight, key considerations in the automotive industry. By eliminating the need for hydraulic fluid and pumps, it reduces the weight of the steering system, leading to lower overall vehicle weight and enhanced fuel efficiency. Studies from the Society of Automotive Engineers (SAE) highlight that EPS systems, including column-assist types, are essential for meeting modern fuel economy standards, which makes them particularly attractive for manufacturers aiming to reduce emissions and improve vehicle performance.

Furthermore, column-assist EPS systems are cost-effective due to their simpler design compared to rack-assist systems. This makes them a popular choice for mid-range and compact vehicles where cost considerations are crucial. Additionally, the system’s adaptability to various vehicle models, including electric and hybrid vehicles, further supports its dominance in the market. Automotive suppliers such as Bosch and ZF have been driving innovation in column-assist EPS technologies, aiming to expand their applications across multiple segments, including electric vehicles (EVs)factors collectively contribute to the continued dominance of column-assist EPS systems in the automotive market, especially in compact and energy-efficient vehicle segments.

How Does the Changing Consumer Preference Drive the Adoption of EPS in Passenger Cars?

The passenger vehicle segment is estimated to dominate the market in the vehicle type category during the forecast period. Passenger vehicles constitute the largest share of the global automotive market, driven by growing urbanization, increasing disposable incomes, and changing consumer preferences. According to the International Organization of Motor Vehicle Manufacturers (OICA), passenger cars account for a substantial portion of vehicle production and sales worldwide. This segment is particularly prominent in regions like North America and Europe, where the demand for personal vehicles continues to rise. The preference for compact, fuel-efficient, and technologically advanced vehicles in these regions further solidifies its dominance.

Passenger vehicles are at the forefront of adopting new automotive technologies, including advanced safety features, electric drivetrains, and autonomous driving capabilities. Innovations like Electric Power Steering (EPS), adaptive lighting, and autonomous driving systems are frequently introduced in passenger vehicles before they are adopted in commercial or heavy-duty vehicles. This technological emphasis appeals to consumers who seek modern, comfortable, and safe driving experiences, contributing to the segment’s dominance. As per the Global EV Outlook 2023 by the International Energy Agency (IEA), passenger vehicles are also the primary drivers of electric vehicle (EV) adoption, with significant investments in EV infrastructure globally.

Furthermore, with the shift toward more personalized mobility solutions, passenger vehicles continue to see high demand. The global trend toward car ownership, despite the rise of shared mobility and public transportation, is particularly strong in developed economies. Moreover, the global economic recovery post-pandemic and the need for personal, safer, and more flexible transport options have further strengthened consumer preference for passenger vehicles. This trend is supported by the automotive industry’s focus on enhancing user experience through connected car technologies, infotainment systems, and vehicle customization options.

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Country/Region-wise Acumens

What are the Key Factors Contributing to Central Mexico’s Leadership in the Market?

According to VMR Analyst, Central Mexico is estimated to dominate the Mexico automotive EPS market during the forecast period. Central Mexico is home to several major automotive manufacturing clusters, including the Bajío region. This area hosts manufacturing plants of global automotive giants such as General Motors, Honda, and Toyota. According to a report by Expert Market Research, the automotive market in Mexico is projected to grow at a compound annual growth rate (CAGR) of 3.80% between 2024 and 2032, with regions like Central Mexico playing a pivotal role in this expansion. The concentration of these manufacturers drives the demand for advanced automotive components like EPS systems.

Central Mexico’s location offers excellent access to both the U.S. and domestic markets, facilitating smoother logistics and supply chain operations. This region benefits from its proximity to the United States, which is the largest market for Mexican automotive exports. According to the Mexican Ministry of Economy, automotive exports have been a cornerstone of the nation’s economy, with significant contributions from Central Mexico’s automotive production facilities.

Furthermore, with the global shift toward electric mobility, Central Mexico is increasingly investing in electric vehicle (EV) production. The Mexican government has been promoting initiatives to attract foreign investment in the EV sector, especially in regions like Central Mexico. As electric vehicles require sophisticated EPS systems, this trend is set to further boost market growth in the region.

How Do Government Initiatives Shape the Market Landscape in the Northern Mexico?

Northern Mexico is estimated to exhibit the highest growth within the Mexico automotive EPS market during the forecast period. Northern Mexico’s proximity to the United States provides a strategic advantage for automotive manufacturing and exports. The region’s location makes it an attractive destination for automotive production facilities, which are focused on supplying the large U.S. market. In fact, according to Mexico’s Ministry of Economy, the automotive industry accounts for a significant portion of Mexico’s exports, with more than 80% of automotive exports going to the U.S. This proximity drives demand for components like EPS, as manufacturers in Northern Mexico increasingly serve U.S. and global automotive companies.

Northern Mexico hosts several major Original Equipment Manufacturers (OEMs) and Tier 1 suppliers. Cities like Monterrey and Tijuana are home to automotive plants owned by companies like Ford, General Motors, and BMW. These manufacturing hubs require advanced steering technologies such as EPS systems, contributing to market demand. According to the Mexican Automotive Industry Association (AMIA), these plants play a significant role in manufacturing vehicles, especially for export.

Furthermore, Northern Mexico has become a center for automotive research and development, especially with growing investments in electric and hybrid vehicle technologies. Many OEMs are focusing on increasing the production of electric vehicles (EVs), which rely heavily on EPS systems for their lighter weight, energy efficiency, and adaptability. The region is benefiting from both local and foreign investments, fostering a conducive environment for advanced automotive technologies. The push towards EVs is boosting demand for EPS systems in the region.

Competitive Landscape

The competitive landscape of the automotive EPS market in Mexico is characterized by the presence of global automotive component manufacturers and local suppliers. The market is shaped by technological partnerships, production capacity expansions, and localization strategies.

Some of the prominent players operating in the Mexico automotive EPS market include:

• JTEKT Corporation
• Robert Bosch GmbH
• NSK Ltd.
• Nexteer Automotive
• ThyssenKrupp AG
• Mando Corporation
• Hyundai Mobis
• Showa Corporation
• ZF Friedrichshafen AG
• Delphi Technologies

Latest Developments

• In October 2022, Knorr-Bremse announced the opening of a new production facility in Querétaro, Mexico, focused on manufacturing electric power steering (EPS) systems for the automotive market. The facility will enhance the company’s capabilities to supply the growing demand for advanced EPS systems in North America.
• In March 2021, Nexteer Automotive, a global leader in steering and driveline systems, expanded its operations in Mexico with the launch of a new EPS manufacturing plant in Chihuahua. This expansion aims to support the increasing demand for EPS technology from major automakers in the region.

Report Scope

Mexico Automotive EPS Market, By Category

Type:

• Column-Assist EPS (C-EPS)
• Pinion-Assist EPS (P-EPS)
• Rack-Assist EPS (R-EPS)
• Dual Pinion EPS

Vehicle Type:

• Passenger Cars
• Commercial Vehicles

Sales Channel:

• OEM
• Aftermarket

Region:

• Northern Mexico
• Central Mexico
• Southern Mexico

Research Methodology of Verified Market Research:

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• Competitive landscape which incorporates the market ranking of the major players, along with new service/product launches, partnerships, business expansions, and acquisitions in the past five years of companies profiled
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