The increasing number of passenger car sales in China along with growing safety concerns is driving growth of active and passive safety systems market. To compete in the market, vehicle manufacturers are likely to adopt advanced active safety systems in a wider range of passenger vehicle segments to differentiate their products. Cost of active and passive safety systems are decreasing, likely to render them more affordable for vehicle manufacturers to increase installations in passenger cars in China.

“The rising demand for passenger vehicles increases vehicle production which drives the deployment of active and passive safety systems to be equipped in passenger vehicles,” says Frost & Sullivan Research Analyst Amelia Wong. “Increased penetration of antilock braking systems and airbag systems along with increased safety concerns are also influencing market growth.”

Vehicle manufacturers are offering lower prices and providing feature differentiation to attract customers. The adaptation of new safety systems to win over customers from competitors drives market growth especially in high-end passenger car segments. In addition, decreasing prices of new technology safety systems is likely to aid mass-adoption.

Safety products are likely to be reliable, requiring assurance on product functionalities. However, vehicle manufacturers are exerting pressure on active safety system suppliers for design and development in more reliable, advanced technology products. The rise in supplier numbers is likely to create a slew of low product prices to compete effectively in this market.

“There are many domestic Chinese systems companies eagerly entering the market and as a result, some domestic suppliers are slashing their product prices,” notes Wong. “In this growing market, failure in systems performance will bring significant financial losses and damages to the brand image of vehicle manufacturers and systems suppliers.”

Systems suppliers can improve their existing products and introduce new products to capture the attention of vehicle manufacturers for adoption in vehicles. They also need to continue research and development efforts to improve existing products and develop new products. Quality assurance is important, with implementation of this process throughout the production line and supply network.