Electric Power Steering Market Size & Share, by Type (Column Assist Type, Pinion Assist Type, Rack Assist Type, Dual Pinion Assist Type); Component (Steering Rack/Column, Sensor, Steering Motor); Vehicle Type (Passenger Cars, Commercial Vehicles); Vehicle Propulsion Type (Internal Combustion Engine Vehicle, Electric and Hybrid Vehicles); Sales Channel (Original Equipment Manufacturers (OEMs), Aftermarket) - Global Supply & Demand Analysis, Growth Forecasts, Statistics Report 2025-2030

Electric Power Steering Market: Growth Drivers and Challenges

Growth Drivers

• Rising demand for electric and hybrid vehicles: Electric and hybrid cars rely on components that help regulate and manage power in a way that does not hinder performance. EPS fulfills this need by minimizing the energy losses commonly experienced in hydraulic systems. In November 2024, ZF Automotive Technology increased its EPS production in China, which proves that local car makers are eager to adopt electronically assisted steering for the largest electric vehicle market in the world. This strategic expansion also fits into the customers’ desire for precision steering and low maintenance. In this context, EPS is a crucial factor for automakers to offer both sustainable and high-performance vehicles for consumers.
• Integration of ADAS in modern vehicles: As ADAS functions such as lane-keeping assist and automatic emergency steering demand precise electronic inputs, EPS systems are well placed to deliver. For instance, the Partnership for Analytics Research in Traffic Safety (PARTS) revealed that 10 out of 14 ADAS features had more than 50% market uptake by 2023. This fact highlights the need for high-performance steering solutions that would be able to respond in a matter of milliseconds. The increasing popularity of ADAS also improves safety and increases the need for EPS technologies that can interact with onboard sensors and control modules.
• Weight reduction and fuel efficiency: Another advantage of EPS is that it plays a major role in weight reduction due to the absence of the hydraulic fluid reservoir and other associated parts. According to the U.S. Department of Energy, reducing the weight of a vehicle by 10% is likely to result in fuel economy gains of between 6% and 8%. This is a plus for both the car manufacturers and the car users who are in most cases conscious of the amount of emission and the running cost. For this reason, EPS is gradually replacing hydraulic steering to reduce fuel consumption in conformity with current trends. These trends reveal how EPS can contribute to providing more environmentally friendly transportation.

Challenges

• Steering system complexity and self-driving cars: Although EPS is beneficial, implementing steer-by-wire systems for fully autonomous vehicles cannot be an easy task. Self-driving systems are very complex and need high levels of redundancy and safety measures, hence the need for software and hardware integration. Steer-by-wire, a system that eliminates mechanical linkages with electrical and electronic systems, has functional safety requirements. This has made development timelines more complicated. However, industry players agree that EPS can be used to facilitate the evolution of the driving process to the next level of automation.
• Supply chain disruptions and component availability: Some of the challenges that affected EPS production include the global semiconductor shortage and logistics disruptions. High precision sensors and control units are essential for steering performance, which becomes a challenge for the supply chain. This has led to the adoption of local sourcing and vertical integration strategies by companies to avoid reliance on a single supplier. While some of these factors may be improving in some areas, the ability to gain a stable supply of electronic components continues to be a key concern for EPS manufacturers seeking to achieve sustained growth.