Techno World Sports-Utility-Vehicle-Market | Page 2

inclination of consumers towards adoption of automobiles with safety features, owing to
increasing number of road accidents is expected to boost growth of the SUVs market worldwide.
For instance, according to World Health Organization (WHO), an estimated 1.25 million road
accidents were reported worldwide in 2013, out of which around 93% road traffic death were
reported in low and middle income economies and over 50 million people were injured by road
accidents.
Furthermore, stringent legislation and policy framework by government, mandating the
installation of safety equipment in automobiles coupled with consumers’ preference for better
safety measures is propelling growth of the SUV market. For instance, according to the
Transportation Recall Enhancement, Accountability and Documentation (TREAD) Act, in
November 2012, the European Union mandated Tire Pressure Monitoring System (TPMS) in every
passenger car models. The U.S. Highway Safety Act of 1991 made airbags and Anti-Lock Braking
System (ABS) mandatory in all passenger cars. These technologies offer efficient operation and
improved safety, which is expected to drive growth of the SUVs market.
Increasing cost of fuel is one of the major restraining factors for growth of the market
The major factor restraining growth of the market is rising fuel price. Increasing adoption of SUV
vehicles is in turn propelling demand for crude oil. This is owing to the fact that SUVs are utility
vehicles and consume more fuel. According to Energy Information Administration (EIA), crude oil
price increased to US$ 60 per barrel at the end of 2017 from US$ 50 per barrel in 2016.
Moreover, according to Coherent Market Insights’ analysis, in India total sales of SUVs were
62,170 units in the month of April 2016, which is decreased to 55,825 units in June 2016.
Therefore, increasing price of crude oil is expected to negatively impact growth of the SUV
market especially in emerging economies such as India and China.
Global SUV Market: Regional Insights
The SUV market in North America accounted for largest share in global market and is expected to
maintain its dominance over the forecast period (2018 – 2026). The growth in this region is
attributed to stringent government regulations to prevent road accidents. For instance, in 2008,
the U.S. Congress TREAD Act, mandated the deployment of appropriate Tire Pressure Monitoring
System (TPMS) technology in all passenger vehicles to improve the driver and passenger safety
by means of dashboard warning system. Moreover, in 2016, the U.S. Department of
Transportation's National Highway Traffic Safety Administration officially announced that
automakers in the U.S. have to make the autonomous emergency braking system a standard
feature for all cars and trucks by 2022. This in turn creates a highly conducive environment for
growth of the regional SUV market.