The basic market requirement for all the All-Wheel Drive (AWD) system suppliers is to maintain the quality and reliability of the system to control all the wheel of car when required. At present, the cost is the most important factor to break the current market share. A new entrant with a cost-effective solution has a valid point of entry in the market. A user needs to pay extra to procure AWD system. The price to procure AWD system is high and is also termed as the biggest hurdle in market adoption. New AWD cost effective solution will have valid entry point in the market.

Due to pressure on the reduction of carbon emission and fuel consumption, the AWD market is witnessing immense pressure from the European region whereas North American region is not witnessing any shift in the trend for AWD. The companies offering the AWD solutions should be prepared for any change in demand by the governments in different regions and the key players need to be focused on their offering with the respective regions.

The present challenge in the auto industry is with regards to carbon emission regulations and fuel consumption. In addition, if the companies want to achieve a real AWD with minimum impact on the environment, then it cannot be addressed with an ABS system. There is a dire need for a device which can split the torque in every wheel. The positive vehicle dynamic system is enabled by providing the right torque to every wheel and employing electronics. 

The challenge is to make the system cost-effective and it can be addressed by combining the AWD system with the power transfer unit in between the axle and by controlling the momentum of the vehicle from rear wheel to front wheel.

In addition, to gain traction, the supplier should also provide the electronic system that controls the torque between axles and should also pump the oil to lower the friction and provide good effect with respect to the component and natural weight of the vehicle. This will further lower down fuel consumption and reduce carbon emission.

The government and customers across different regions will expect a 5% reduction in the fuel consumption by 10% reduction in the weight which will further accumulate to the cost reduction in vehicle operation. The main challenge for the AWD system is to electronically control the system and minimize the losses. In the future, everything will depend on the type of software employed in the car.

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