Passenger Cars Exhaust System Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Fuel Type (Gasoline, Diesel), By After Treatment Type (Diesel Oxidation Catalyst, Selective Catalytic Reduction, Gasoline Particulate filter), By Component Type (Catalytic Converter, Tailpipe, Mufflers) By Region, By Competition 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 26.69 Billion
CAGR (2026-2031)	6.03%
Fastest Growing Segment	Tailpipe
Largest Market	Asia Pacific
Market Size (2031)	USD 37.92 Billion

Market Overview

The Global Passenger Cars Exhaust System Market will grow from USD 26.69 Billion in 2025 to USD 37.92 Billion by 2031 at a 6.03% CAGR. The Global Passenger Cars Exhaust System Market involves the engineering and production of components designed to guide reaction exhaust gases away from a controlled combustion engine. Key elements include the manifold, catalytic converter, muffler, and tailpipe, which collectively function to reduce noise and mitigate harmful emissions. The market is primarily supported by stringent government emission regulations that compel manufacturers to adopt advanced after-treatment technologies, alongside sustained vehicle production in emerging economies where internal combustion engines remain dominant.

According to the China Association of Automobile Manufacturers, in 2024, passenger vehicle sales in China reached 27.56 million units, illustrating the robust demand for conventional automotive components in key regions. However, the market faces a significant challenge from the global transition toward battery electric vehicles. As electric powertrains eliminate the need for exhaust infrastructure, the accelerating shift away from traditional engines presents a substantial long-term impediment to market expansion.

Key Market Drivers

The Expansion of Global Passenger Vehicle Production volumes serves as a foundational driver for the market, as every internal combustion engine vehicle manufactured necessitates a corresponding exhaust system. Despite the accelerating transition toward electrification, the absolute number of conventional and hybrid vehicles produced remains high, particularly in developing nations where charging infrastructure is still maturing. This continued manufacturing volume ensures a steady baseline of demand for critical components such as manifolds, catalytic converters, and mufflers, which are essential for compliance and performance. According to the European Automobile Manufacturers' Association (ACEA), March 2025, in the 'Economic and Market Report: Global and EU auto industry – Full year 2024', global passenger car sales reached 74.6 million units in 2024, marking a 2.5% increase compared to the previous year. This growth signifies that the addressable market for exhaust components continues to expand in absolute terms, supported by fleet renewal cycles and economic recovery in key manufacturing hubs.

Simultaneously, the Growth in Hybrid Electric Vehicle (HEV) Adoption is creating new, high-value opportunities for advanced exhaust technologies. Unlike battery electric vehicles, hybrids retain an internal combustion engine that requires sophisticated exhaust architectures to manage intermittent engine operation and maintain thermal efficiency for catalytic conversion. This trend is particularly evident in major markets where consumers seek fuel efficiency without the range anxiety associated with full electrics. According to the China Association of Automobile Manufacturers, November 2025, in its monthly statistical release, plug-in hybrid vehicle sales in China totaled 4.61 million units between January and October 2025, representing a year-on-year increase of 17.8%. This surge in hybrid popularity sustains revenue streams for component suppliers, as these systems often command higher prices due to their complexity. Reflecting this segment's financial contribution, according to Forvia, July 2025, in its 'Half-Year Results 2025', sales for the company's Clean Mobility division reached €2,043.1 million in the first half of 2025.

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Key Market Challenges

The global transition toward battery electric vehicles (BEVs) constitutes a fundamental structural impediment to the growth of the Global Passenger Cars Exhaust System Market. Unlike internal combustion engines, which require complex assemblies of manifolds, catalytic converters, and mufflers to manage emissions, electric powertrains function without any exhaust infrastructure. This technological shift creates a direct volume loss for component manufacturers, as every electric vehicle sold represents a unit of lost potential revenue. As automakers reallocate R&D budgets and manufacturing capacity toward electrification, the Total Addressable Market (TAM) for exhaust systems inevitably contracts, limiting the sector's long-term expansion potential.

This displacement effect is quantitatively evident in major automotive hubs, where the adoption of non-ICE vehicles is accelerating rapidly. According to the China Association of Automobile Manufacturers, in 2024, the sales of new energy vehicles accounted for 40.9% of total new car sales in China. Such a significant market share for vehicles devoid of exhaust hardware illustrates the rapid erosion of the conventional customer base. Consequently, the rising adoption rates of electric mobility directly reduce the demand for traditional after-treatment technologies, countering the gains from general vehicle production growth.

Key Market Trends

To comply with stricter particle number limits in regulations like Euro 6d and China VI, OEMs are standardizing the installation of particulate filters on gasoline direct-injection engines, mirroring the established trend in diesel powertrains. This regulatory pressure mandates the integration of advanced filtration hardware to capture fine particulate matter, ensuring compliance with tightening global standards regarding tailpipe pollutants. According to Applus IDIADA, May 2024, in the article 'European union publishes new euro 7 regulation for vehicle emissions and battery durability', the European Union officially adopted Regulation (EU) 2024/1257, which enforces rigorous limits on particle emissions and requires continuous onboard monitoring, thereby compelling exhaust manufacturers to embed sophisticated filtration and sensor technologies into their gasoline architectures.

As hybrid vehicle sales rise, exhaust systems are being redesigned with specialized thermal management properties to handle frequent engine start-stop cycles and lower exhaust gas temperatures typical of hybrid powertrains. Engineers are focusing on lightweight, insulated architectures that retain heat effectively to keep catalytic converters at optimal operating temperatures during the electric-only phases of driving. Highlighting the commercial viability of this technological pivot, according to Forvia, October 2025, in the 'Press Release: Third-quarter 2025 sales', the Clean Mobility division achieved a reported sales growth of 8.7% year-on-year, underscoring the sustained demand for advanced exhaust solutions compatible with electrified platforms despite the broader market challenges.

Segmental Insights

The tailpipe segment is currently recognized as the fastest-growing category within the global passenger cars exhaust system market. This rapid expansion is primarily driven by increasing consumer demand for vehicle customization and sporty aesthetics, necessitating distinct configurations such as dual or chrome-finished outlets. Additionally, stringent noise pollution mandates enforced by regulatory entities like the European Union compel manufacturers to engineer advanced tailpipe assemblies that effectively mitigate acoustic levels without compromising engine performance. These factors collectively stimulate the accelerated supply of specialized tailpipe units to meet both compliance standards and evolving design trends.

Regional Insights

Asia Pacific holds the dominant position in the global passenger cars exhaust system market, driven primarily by the extensive automotive manufacturing capabilities in China, India, and Japan. The region experiences consistent demand for passenger vehicles due to increasing urbanization and rising disposable incomes. Additionally, strict environmental regulations enforce the adoption of compliant emission control components. For example, adherence to rigorous standards such as Bharat Stage VI in India and China VI mandates that manufacturers integrate efficient exhaust technologies, thereby sustaining the region's leadership in the global sector.

Recent Developments

• In December 2025, Johnson Matthey officially opened its first dedicated hydrogen internal combustion engine testing facility in Gothenburg, Sweden. The new center is designed to test and validate advanced emission control systems specifically for hydrogen-powered engines, which are emerging as a key technology for decarbonizing the transport sector. The facility allows for the rigorous assessment of catalytic converters and aftertreatment technologies under real-world operating conditions to ensure they meet stringent zero-emission standards. This development underscores the company's focus on enabling clean hydrogen mobility and supporting the automotive industry's transition towards sustainable powertrain solutions through specialized research capabilities.
• In November 2025, Marelli received the Innovations in Lightweighting Award from the Society of Automotive Analysts for its LeanExhaust system. This advanced exhaust platform was recognized for its ability to significantly reduce weight by up to 16 kilograms compared to traditional systems while maintaining high performance in emissions control and noise reduction. The system features a compact dual-layer catalytic converter and a micro-hole design muffler, which eliminates the need for heavy internal glass wool insulation. This development addresses the automotive industry's growing demand for lightweight solutions that contribute to improved fuel efficiency and reduced carbon footprints in internal combustion and hybrid vehicles.
• In October 2024, the Benteler Group announced a significant investment in the mid-double-digit million-dollar range to upgrade its automotive manufacturing facility in Spartanburg, South Carolina. The project aims to enhance the production and assembly capabilities at the site, which serves as a key supplier to major automotive original equipment manufacturers in the region. This expansion focuses on improving operational efficiency and optimizing the manufacturing processes for critical automotive components, including exhaust systems and modules. The strategic investment reinforces the company's commitment to supporting its customers' increasing production requirements and strengthening its manufacturing footprint in the North American market.
• In September 2024, Purem by Eberspaecher announced its participation in the hy-fcell trade fair, where the company presented a comprehensive portfolio of components for hydrogen and fuel cell applications. The showcase included a modular exhaust air system specifically designed for fuel cell vehicles, which manages water removal and acoustic damping to ensure efficient operation. The company also displayed specialized water separators and silencers engineered to meet strict noise emission standards for these advanced powertrains. Additionally, the exhibit highlighted Balance of Plant components, such as gas control valves and cathode isolation valves, demonstrating the transfer of the company's exhaust technology expertise to hydrogen mobility.

Key Market Players

• Faurecia
• Tenneco Inc.
• Continental AG
• Eberspächer
• Futaba Industrial Co., Ltd.
• Bosal
• Magna International
• Sango Co., Ltd.
• Sejong Industrial Co., Ltd.
• Yutaka Giken Co., Ltd.

By Fuel Type	By After Treatment Type	By Component Type	By Region
Gasoline Diesel	Diesel Oxidation Catalyst Selective Catalytic Reduction Gasoline Particulate filter	Catalytic Converter Tailpipe Mufflers	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Passenger Cars Exhaust System Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Passenger Cars Exhaust System Market, By Fuel Type:

• Gasoline
• Diesel

• Passenger Cars Exhaust System Market, By After Treatment Type:

• Diesel Oxidation Catalyst
• Selective Catalytic Reduction
• Gasoline Particulate filter

• Passenger Cars Exhaust System Market, By Component Type:

• Catalytic Converter
• Tailpipe
• Mufflers

• Passenger Cars Exhaust System Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE