DC Contactor Market Size, Share & COVID-19 Impact Analysis, By Type (Definite-Purpose DC Contactors and General Purpose DC Contactors) By End-User (Electric Vehicle, Renewable Energy and Storage, Aerospace and Defense, Industrial Machineries, and Others), Regional Forecasts, 2022-2030

The global DC contactor market size was valued at USD 400.08 million in 2022. The market size is projected to grow from USD 441.00 million in 2023 to USD 827.15 million by 2030, exhibiting a CAGR of 9.40% during the forecast period.

A DC contactor is an electrically controlled device that controls current in DC circuits by closing and opening internal contacts and simultaneously turning power on and off. They control much lower voltages when compared to AC circuits, and they also offer the advantage of minimal arcing during opening and closing the circuit. The contacts are the current-carrying part of the contactor, which includes power contacts, auxiliary contacts, and contact springs. The electromagnet provides the driving force to close the contacts. They provide an inexpensive and reliable power-switching method in low-voltage DC circuits. Some end-use industries that use DC contactors include electric vehicles, renewable energy (solar and wind), and other industrial machinery.

COVID-19 Impact

COVID has Caused Significant Disruption to the Market Growth

The sudden outbreak of the infectious disease recognized as the coronavirus disease (COVID-19) has caused chaos and panic across the globe, causing the termination of all normal daily activities like going to work, gathering, meetings, and commuting between countries-even stepping a foot outside the house.

The outbreak of COVID has hampered the growth of the market. Strict government-imposed regulations had limited market growth during the pandemic. Several industrial projects have been halted or permanently shut down, hampering these shooters' growth. Moreover, 2020 global electric car sales are a two-act drama. In 2020, lockdown measures paralyzed production facilities and supply chains on the one hand and consumer demand on the other. As the pandemic began to ramp up in early 2020, it was widely expected that EV market share would likely be more resilient than the broader auto sector. However, EV sales were still broadly expected to decline, albeit less than overall auto sales.

LATEST TRENDS

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Growing Usage of Contactors in Electric and Renewables to Create Tremendous Opportunities

The demand for EVs and HEVs is increasing due to rising fuel prices and government incentives. Governments of different countries are promoting electric mobility to reduce dependence on crude oil and reduce vehicle pollution. Numerous automobile manufacturers have started the production of electric vehicles or hybrid electric vehicles, thereby supporting the market's growth. Such contactors are used in EVs or HEVs to disconnect the high-voltage battery from the high-voltage grid.

The growing awareness of the importance of maintaining a clean environment has fueled the growth of renewable energy projects. Solar energy is considered to be the fastest-growing renewable energy application. Additionally, the continuously increasing demand for growing green electricity shares also supports the growth of solar energy. The main application for contactors in PV systems is disconnecting the inverter from the PV strings when the required power is low. Moreover, these contactors are used to change the configuration of the PV strings to increase system efficiency by changing other strings to an optimal converter. 

DRIVING FACTORS

Rising HVAC System Installations to Propel Market Growth

Consumers' growing desire for comfort has increased the installation of HVAC systems. Several companies are developing products that provide multiple benefits to meet consumer demands. To reduce repair costs, the HVAC system also alerts consumers to system failures, maintenance cycles, and unusual behavior. Sudden climate change is also fueling the growth of HVAC systems in commercial and residential areas. Therefore, the growing HVAC system supports the development of DC contactors, as these are majorly used in HVAC systems to regulate the voltage applied to the loads.

The major factors driving global market trends are high voltage transmission lines for renewable energy sources and minimizing the risk of failure by increasing the availability of inverters in substations that allow connection to a generator during a power outage. Growing demand for renewable energies such as solar, wind, and hydroelectric power and the increasing adoption of DC power systems in industrial applications are some other factors that have contributed to the industry's development. 

Rising Energy Demand to Augment Market Growth

Increasing industrialization and urbanization across the globe, particularly in countries like China and India, have boosted electricity demand. The consumption of electricity per capita has increased with the growing population in the region. Thus presenting an opportunity for the contactors market, as these contactors can play an important role in controlling the flow of electricity. Population growth and increasing urbanization rates are likely to increase energy demand worldwide. According to the United Nations report, 55% of the world's population lives in urban areas, which is likely to increase to a 68% growth rate by 2050. In addition, rapid urbanization also encourages the growth of these protectors.

According to major players, global electricity demand is growing by approx. 1.8% per year, growing to nearly 50% growth rate due to the growing population and expenditure capacities. Led by the growing economies of developing countries, average global household electricity consumption will increase by about 75% between 2021 and 2050. Energy efficiency plays a major role in restraining energy demand growth in the residential and commercial sectors as modern appliances, advanced materials, and policies shape the future.

RESTRAINING FACTORS

High Cost of DC Contactors and Availability of Alternatives to Limit Product Adoption

The high cost of these contactors is causing consumers to turn to alternatives such as relays and solenoids, hampering the DC contactor market growth. Also, the shooters needed a more central area of ​​the location. In contrast, magnets and relays take up less space and are available in the market at a lower price than contractors. Further, if the maintenance of a component is not performed in a certain time frame, it can cause system failure or frequent failures, which can cause damage to the system.

Additionally, the DC contactor needs to be replaced within a certain span, as the aging of relays causes problems due to dust and can result in system failure. However, leading manufacturers are developing solutions to mitigate such threats. For example, Panasonic introduced EV-A Series Automotive Relay, suitable for usage in electric vehicles, DC Charging Stations, and other high-voltage DC applications such as Hybrid Construction Equipment.

SEGMENTATION

By Type Analysis

Definite-purpose DC Contactor Dominates the Market Due to its Wide Acceptance in the HVAC Sector

Depending on the type, the market is segmented into general-purpose and definite-purpose DC contactors.

General purpose contactors dominated the global market trends in 2020 due to their wide acceptance in the HVAC industry. The general-purpose DC contactors are used in motor end-users, power switching, process automation, and protection against voltage fluctuations.

Definite-purpose contractors also show significant growth in the market due to their convenient use and easily interchangeable characteristics. General-purpose contactors are generally used to control the direct power flow in a circuit.

By End-User Analysis

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Electric Vehicle Segment Holds the Dominant Market Share due to Rising Adoption of Product

By end users, the market is segmented into electric vehicles, renewable energy & storage, aerospace & defense, industrial machinery, etc.

The electric vehicle segment dominated the global market trend due to its rising demand for low carbon emissions.

Electric vehicles don’t emit carbon directly; hence, they are less harmful to the environment than vehicles powered by combustion engines and are also less expensive and cheaper to run. Based on these aspects, the demand for these contactors is increasing with the rising demand for EVs.

REGIONAL ANALYSIS

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Geographically, the market is spread across five key regions, including Europe, North America, Asia Pacific, the Middle East & Africa, and Latin America. According to our insights, Asia Pacific will dominate the global DC contactor market share during the forecast period.

In the Asia Pacific region, Japan and China are considered the world's largest markets for electric vehicles. These contractors are used in these EVs and HEVs to connect and break the power supplies. Furthermore, North America is forecast to grow steadily, with the U.S. leading the region's market. Rising EV sales and renewable energy projects are expected to dominate the market.

Countries such as Argentina, France, Germany, and others have set the target of zero carbon emissions by 2050 across Europe, increasing the number of renewable energy projects in the region and boosting market growth. Additionally, the region has some of the world's largest car manufacturers, such as BMW, Daimler, Delphi, Volkswagen Group, Ford, Hyundai, Renault, and many others, transitioning to EV and HEV and promoting the use of these types of contractors in the region.

The Middle East & Africa are expected to grow significantly as many countries undergo massive development activities. Industrial and commercial activities are carried out on a large scale, increasing electricity consumption in the area, and contractors can control or cut off electricity.

KEY INDUSTRY PLAYERS

Big Corporations Focus on Developing High-Performance Products to Secure Position

The global market is considerably fragmented, with various players operating at the national, regional, and global levels. The major players are focusing on the research and development of high-performance motor systems with amplifying operational features to secure their foothold across the industry.

Schaltbau Group is expected to generate significant market share due to its increasing focus on delivering DC contactors for various applications. The company has also gained strong brand value primarily by providing an extensive range of efficient and advanced DC contactors with optional customized delivery across the globe.

Besides, Ametek Switch has also exhibited significant potential and is striving to expand its horizons by successfully delivering its motors & other products for a wide range of applications.

Additionally, other key participants operating in the industry include ABB, TE Connectivity, Sensata Technologies Inc., and many other small, medium, and major players. These organizations continuously focus on expanding their product offerings and reaching across the market.

List of Key Companies Profiled:

• Omron Corp. (Japan)


• Siemens AG (Germany)


• Rockwell Automation (U.S.)


• ABB (Switzerland)


• TE Connectivity (Switzerland)


• Mitsubishi Electric (Japan)


• Sensata Technologies Inc. (U.S.)


• Ametec Switch (U.S.)


• Hotson International Ltd. (China)


• Trombetta Inc. (U.S.)


• Schaltbau Company (Germany)


• Cotronics BV (Netherlands)

KEY INDUSTRY DEVELOPMENTS:

• April 2023 –  Littelfuse, Inc., announced its product portfolio expansion of direct current (DC) contactors majorly for industrial applications. The company aims to provide more flexibility for developing high-powered EVs.


• February 2023 – Mitsubishi Electric Corporation announced that on February 16, it entered into a stock transfer agreement to acquire 100% of Scibreak AB, a Sweden-based company that develops direct current circuit breakers (DCCBs). Both companies aim to strengthen the competitiveness of their combined company by working closely together on developing DCCB technologies for direct high-voltage current (HVDC) systems to support the growing global deployment of renewable energy.


• December 2022 – ABB announced that it had signed an agreement to purchase Siemens' low-voltage NEMA motor business. This acquisition brings a respected product portfolio with manufacturing operations in Mexico.


• April  2022 – OMRON Corporation announced that it had launched K7TM on a global level, a condition monitor that can visualize the deterioration tendencies of heaters generally used in automobile and semiconductor manufacturing without expert knowledge and contribute to the realization of predictive maintenance.


• January 2022 – Sensata Technologies announced that they would launch the new GXC and MXC series of Smart Tactor contractors, which will come with CAN-bus communication and provide valuable data for improved system performance, battery systems, energy storage, and supply industrial applications.

REPORT COVERAGE

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The market report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product/service types, and leading applications of the product. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the market report encompasses several factors that contributed to the market growth in recent years.

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