China Automotive Seat Market - Growth, Trends, and Forecasts (2022 - 2027)

The China Automotive Seat Market was valued at USD 3392.12 million in 2021 and is expected to reach USD 4370.09 million in 2027 registering a CAGR of around 4% during the forecast period.

The COVID-19 pandemic had a negative impact on the market during the first half of 2020 as a shutdown of manufacturing facilities and lockdowns resulted in a decline in vehicle production across the country. However, by end of 2020, vehicle sales increased creating a positive outlook for the vehicle manufacturers and seat manufacturers. For instance, In December 2020, a report released by the China Association of Automobile Manufacturers (CAAM) stated that

Overall vehicle production in December 2020 totaled 2.84 million units, reflecting a 5.7% year-on-year increase, while sales totaled 2.831 million units, reflecting a 6.4% year-on-year increase. However, 2020 year total production for January through December totaled 25.2 million units with a 2.0% decline compared to the same period in the previous year, and sales were 25.311 million units, reflecting a 1.9% y/y decline.

Over the medium term, growing consumer inclination toward safety and comfort coupled with recovering sales and a positive outlook for the automotive industry especially premium and luxury cars expected to drive demand for the market. In addition, increased adoption of electric vehicles is also likely to contribute to the growth of the market.

Moreover, the shift in focus of automotive manufacturers to reduce the overall vehicle weight with the use of advanced fabric material for seats is anticipated to offer new opportunities for players operating in the market. The majority of luxurious vehicles are generally equipped with leather seats, which provide premium quality seats and look to the vehicle. For example, According to data from the China Automobile Dealers Association, China's luxury vehicle sales in the first 11 months of the year 2021 exceeded 2 million units with a year-on-year increase of over 5%. This also marked the third consecutive year for luxury brands to register growth in the wake of downward pressure in China's overall automotive market.

Further, advancements in seat technology like Smart Seats and simultaneous innovations in seats to suit connected cars and autonomous cars are anticipated to offer new opportunities for players operating in the market. Apart from this, the emerging trend of autonomous vehicles is encouraging manufacturers to design intelligent seating systems with superior comfort and ergonomics and light and sustainable materials.

Key Market Trends

Growing Demand for Ventilated Seats to Enhance Market Growth During Forecast Period

The Ventilated segment of the market studied is expected to poise notable growth during the forecast period. Rising vehicle production and demand for comfort and luxury features in vehicle interiors are expected to act as major driving factors for the automotive seat market in China. Further, the future of the automotive ventilated seat market in China looks promising with opportunities in the mid-size car, large car, SUVs, and crossover segments. For example, In September 2021, In order to improve its penetration in the Chinese market, Grammer opened a new automotive production site in Shenyang.

Moreover, in China, cars of the foreign OEMs had the seat ventilation feature whereas the domestic OEMs like Wuling, Changan, Baojun, and Geely had included this feature only for their high-end models. Manufacturers are installing every possible technology that can increase the vehicle's comfort standards. Until now, ventilated seats are majorly found in premium vehicles but the manufacturers are looking forward to offering this technology in mid-range and economy cars also. Besides these, key players operating in the market are entering into colloborations with car manufacturers, designing strategies to tackle demand from electric and autonomous vehicles, etc.

• In July 2022, Chinese electric vehicle maker BYD announced the details of its new vehicle model Seal. This model features seat ventilation/heating and other features. The manufacturer revealed that the number of pre-orders exceeded 60,000 (since May 20), which is a substantial number.
• In April 2021, Grammer AG and FAW Group have signed a joint venture in order to produce high-quality seats for commercial vehicles in China. The company will produce its high-end driver seat series as part of the new joint venture as well. In doing so, Grammer is planning to establish additional capacity locally in addition to existing production sites and component plants in china.

Apart from these, factors such as varying high temperatures and demand for comfortable expected to act as market growth catalysts in coming years. Therefore, such developments wrt ventilated seats indicate a significant increase in market share of the market during the forecast period.

Leather Expected to be Dominate Material Segment of the Market

The leather segment of the market studied is likely to witness decent growth during the forecast period. Leather is majorly used in the premium segment of cars, as leather is seen as a luxury in cars. Though it is costly and requires high maintenance, most end users prefer this material to meet their upholstery requirements as it offers a premium look and gives certain utilitarian benefits over ordinary materials used in car interiors. ​

The growing sales of premium cars will be an opportunity for the genuine leather segment, as customers are demanding tailor-made solutions, and this trend has picked up the pace by introducing combined modules, to compose the car seats in luxury cars. For instance, China's luxury car market has maintained strong growth in recent years. According to data from China Passenger Car Association, in 2021, the cumulative sales of luxury brand cars, including Tesla, stood at 2.65 million units, a year-on-year increase of 5 percent.

Some of the major players having a strong presence in the market include Faurecia, Yanfeng Adient Seating, Lear Corporation, Toyota Boshoku, TS TECH, and Others. These players are designing certain growth strategies like partnerships, collaborations, etc. to capture the growing market share in the country. For instance, ​

• In August 2022, Seiren announced that it will increase production capacity for its QUOLE automotive synthetic leather material for seats, which is growing in demand. The company plans to install additional production lines at its plants in China to increase its global production capacity of QUOLE by about 20%. The QUOLE material, which is lightweight and highly design-oriented, is being increasingly adopted as a seat material that can replace genuine leather.
• In May 2021, Faurecia announced that it has provided entire luxurious seating offer for the Li Xiang One from the fully adjustable frame to the Nappa leather covering. The company has focused on safety and comfort means an 8-way adjustable seat, 4-way lumbar support, and an in-seat heating and ventilation system. It also worked on creating a premium aesthetic in the Li Xiang One cockpit.

The above-mentioned factors are expected to contribute significantly for overall development of ventilated segment of automotive seat market in China.

Competitive Landscape

The China Automotive seat market is moderately consolidated and some of the major players in the market are Yanfeng Adient Seating Co., Ltd., Lear Corporation, Faurecia SE, Magna International Inc, and others. For being ahead in the competition the companies are making new joint ventures and expanding their presence in the country. For instance,

• In October 2021, Faurecia, one of the world's leading automotive technology companies, announced that following approval from the appropriate regulatory bodies it has completed the acquisition from DAS Corporation of 50% of their joint venture with BAIC, Beijing BAI DAS Automotive System Co., Ltd. The joint venture is the main seating supplier for BAIC Hyundai and has strong development opportunities with other BAIC-owned brands and partners.​
• In March 2021, Adient, a global leader in automotive seating, announced that as part of its strategic transformation in China, it has entered into definitive agreements with joint venture partner Yanfeng Automotive Trim Systems Ltd. (YF) to end its Yanfeng Adient Seating Co., Ltd. (YFAS) joint venture in China. Under the agreements, Adient will sell its 49.99% interest in YFAS to YF and its minority interest in certain other joint ventures and will receive USD1.5 billion in cash and will acquire YFAS's 50% equity interest in Chongqing Yanfeng Adient Automotive Components Co., Ltd. and YFAS's 100% equity interest in Yanfeng Adient (Langfang) Seating Co., Ltd.

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