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Uncertainty looms over the manual transmission's future. Could it vanish into irrelevance, or persist in a vehicular world that's increasingly electric and environmentally conscious?

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In the automotive industry, a significant shift is underway, with manual gearboxes losing favour among car buyers, particularly in the passenger vehicle segment. This trend is driven by the rapid growth in electric vehicle (EV) adoption and advancements in automatic transmission technologies.

The growth of automatic and dual-clutch transmissions is evident, as they are favoured for performance, fuel efficiency, and driver convenience. Dual-clutch transmissions, in particular, exhibit the highest growth among transmission types, with a 5.71% Compound Annual Growth Rate (CAGR) expected through 2030. Automated manual transmissions (AMTs) are also increasingly used in commercial vehicles to reduce driver fatigue and improve fuel economy.

The impact of electrification is undeniable. EVs mostly adopt multi-speed e-axles or single-speed transmissions, reducing the need for traditional manual gearboxes. About 50% of transmission product redesigns are now for EV compatibility, involving lightweight materials and modularity. Battery electric vehicles use advanced electrification-compatible transmission designs to maximize driving range and efficiency.

The integration of electronic shift-by-wire gear shifters and software controls is on the rise, enabling seamless gear transitions essential for semi-autonomous and autonomous driving. These systems replace mechanical manual gearboxes, offering better efficiency, modularity, and compatibility with advanced driver assistance systems (ADAS).

Asia-Pacific, led by China’s aggressive EV adoption, drives a significant share of the transmission market, accelerating the decline in manual gearbox use there. The overall automotive transmission market grows steadily (about 5-6% CAGR to 2030), but traditional manual gearboxes see a declining share as the market pivots to electrification, automation, and advanced transmissions.

In Europe, stricter CO2 emission standards, culminating in a planned ban on the sale of new Internal Combustion Engine (ICE) vehicles by 2035, are driving demand for cleaner, compliant vehicle technologies. Many carmakers, such as Volvo and Mercedes-Benz, have already stopped producing ICE-powered manual transmission vehicles.

In the UK, the ZEV mandate requires manufacturers to sell an increasing percentage of zero-emission vehicles each year, aiming to accelerate the transition to cleaner transport. The growth in popularity of battery-electric vehicles (BEVs) and plug-in hybrids (PHEVs) is contributing to the decline in manual gearbox uptake.

Despite the decline, manual gearboxes are not disappearing entirely. Toyota plans to develop a simulated manual transmission system for EVs, aiming to preserve the engaging experience of driving a manual car. This system can be switched off, returning the vehicle to standard EV operation for convenience. Toyota plans to introduce this feature in production models around 2026, targeting driving enthusiasts seeking a more interactive EV experience.

In France, a malus scheme for cars that cause pollution is pushing buyers towards cars without a manual transmission. The UK has introduced Ultra Low Emission Zones (ULEZ) in cities such as London to cut vehicle-related air pollution. Non-compliant vehicles are charged in ULEZ areas, driving demand for cleaner, compliant vehicle technologies.

In summary, manual gearboxes are becoming less common in new vehicles, particularly passenger cars, due to the rise of EVs and advanced automatic transmissions. However, automated manuals still have roles in specific commercial applications, and ongoing innovations support a gradual rather than abrupt phase-out. The market is decisively moving toward software-driven, electrification-compatible transmissions with enhanced automation, effectively replacing traditional manual gearboxes in most segments.

[1] Transmission Market Report, 2021-2030, MarketsandMarkets [2] Automatic Transmission Systems: Market Shares, Strategies, and Forecasts, 2021-2031, IDTechEx [3] The Future of Transmission Systems, SAE International [4] Electric Vehicle Transmission Market Analysis, 2020-2028, Grand View Research [5] Global Automotive Transmission Market Size, Share & Trends Analysis Report By Transmission Type, By Vehicle Type, By Region And Segment Forecasts, 2021 - 2028, Fortune Business Insights

  1. The growth of electric vehicles (EVs) in the automotive industry and advancements in automatic transmission technologies are causing a significant decline in manual gearbox use, especially in the passenger vehicle segment.
  2. The market for transmission systems is shifting towards software-driven, electrification-compatible transmissions with enhanced automation, effectively replacing traditional manual gearboxes in many vehicle segments.
  3. In Europe, stricter CO2 emission standards and plans for a ban on new Internal Combustion Engine (ICE) vehicles by 2035 are driving the demand for cleaner, compliant vehicle technologies, leading to a decline in manual transmission vehicles.
  4. Despite the trend towards automatic and EV transmissions, Toyota plans to develop a simulated manual transmission system for EVs, aiming to preserve the engaging driving experience for motorists while offering the convenience of standard EV operation when desired.

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