Automatic Transmissions: Turning Machined Metal Parts into a Qualified Vehicle Drivetrain

Updated: 2026-09-04 Scope: Automotive automatic transmissions within a broad power-transmission classification that also includes shafts, gears, bearing housings, and other transmission components. The classification includes industrial gears and shafts and has many downstream links to general machinery. Specific examples in this report therefore focus on automatic-transmission makers such as AISIN, ZF, and Jatco.

Evidence coverage

This report combines the classification, BACI 2024, the physical network, official materials from ZF, Jatco, GM, Hyundai Transys, BYD, AISIN, and BorgWarner; primary supplier sources from Exedy, Valeo, Hilite, Nidec Tosok, DYNAX, NSK, NTN, and JTEKT; and certification materials from IATF and AIAG. Evidence coverage is partial. Sources are strong for finished-product makers and major component layers, but primary materials from Ford and Chinese groups such as SAIC/Geely, as well as automatic-transmission-fluid (ATF) suppliers, have not been obtained.

Key takeaway

Automatic transmissions start with steel and cast components, but the unit of competition is not the price of an individual part. Competitiveness depends on integrating specialized layers—torque converters, wet friction materials, valve bodies and solenoids, and precision bearings—at volume-production quality under IATF 16949, then supplying to the vehicle maker’s specifications.

The EV transition is not a simple, uniform replacement of transmission demand by reduction gears. A CVT specialist is reusing its gear technology in integrated reduction-drive units; investment in conventional multi-speed automatics continues; and the profitability of EV drivetrain businesses themselves is unstable. All these shifts are occurring at once.

Steel · cast metals · machined parts
              ↓
Torque converter · friction materials · valve body · precision bearings (specialist suppliers)
              ↓
Gear · shaft · case machining and heat treatment → Assembly · IATF 16949 quality · performance testing
              ↓
Automatic transmission → Vehicle assembly (volume qualification) → Vehicle use
              ↓
Returned unit → Disassembly · inspection · rebuilding → Remanufactured product
              │
              └─ (EV transition) technology repurposed in part → eAxle / integrated reduction-drive unit

1. Classification and trade geography

Exports in the broad power-transmission classification in 2024 were about US$70.6 billion, with an HHI of 913. Germany accounted for 18.6%, China 16.1%, the United States 12.0%, Japan 6.9%, and Italy 6.3%, appearing relatively dispersed by country.

However, the physical network also shows the broad classification branching into many general machinery groups. It covers gears, shafts, bearing housings, and other transmission components—not only automotive automatic transmissions. Substitutability by vehicle model, drivetrain, and performance requirement cannot be inferred from the aggregate.

2. Finished products are supplied by companies across several countries

ZF Friedrichshafen opened its first U.S. passenger-car transmission plant in Gray Court, South Carolina, in 2013. It produced 8-speed automatic transmissions (8HP) and 9-speed automatics (9HP, described as the world’s first at the time), with annual capacity of about 1.2 million units. ZF: First U.S. passenger-car transmission plant

Nissan-affiliated Jatco held a 41% global share of CVT unit production in 2015, which it described as the industry’s leading position. It produced in four countries, including at a plant in Guangzhou, China, and in 2016 became the first single manufacturer to reach cumulative production of 30 million CVTs. Jatco: Global CVT share

GM converted its Toledo plant to make drive units for Ultium battery-electric vehicles (BEVs), while continuing to invest US$300 million in its Romulus plant and US$40 million in Toledo in 2026 to expand production of 10-speed automatics for next-generation full-size trucks and SUVs. GM: U.S. manufacturing investments

South Korea’s Hyundai Transys describes itself as the world’s only transmission-specialist parts company affiliated with a vehicle manufacturer. It invested more than US$240 million in an expansion in West Point, Georgia, to produce 8-speed automatics. Hyundai Transys: West Point expansion

In China, BYD says its “Super Hybrid DM” technology has surpassed 8.5 million cumulative sales and is introducing dedicated transmission design to Europe. BYD: DM Super Hybrid Europe

This parallel structure shows that automatic transmissions are not the technology of one company such as AISIN. Independent suppliers (ZF, Hyundai Transys), suppliers affiliated with automakers (Jatco, AISIN, BYD), and an automaker with both types of operation (GM) compete across regions.

3. Manufacturing depends on integrating specialist components and qualifying for volume production

Automatic transmissions are not made by a finished-product manufacturer working alone; they depend on specialist suppliers. Exedy makes torque converters and wet friction materials (paper discs), and identifies DYNAX as a supplier of some friction materials. Exedy: Automatic-transmission products

BorgWarner supplies wet friction plates for ZF’s 8- and 9-speed automatics from two sites in Germany and the United States. BorgWarner: Wet friction-plate technology for ZF

For valve bodies and solenoids, Nidec Tosok says it develops in-house control valve bodies and solenoid valves—the “heart” of automatic and continuously variable transmissions. Nidec Tosok: Business overview Hilite also makes electrohydraulic control valves and valve modules for dual-clutch transmissions.

In precision bearings, NSK, NTN, and JTEKT each develop products such as thrust needle bearings, one-way clutches, and low-friction tapered roller bearings. JTEKT announced a new bearing in 2020 that reduced friction torque by 60%. JTEKT: LFT-V bearing

The ability to integrate these specialized components and produce at volume is tied to qualification under the IATF 16949 international quality-management standard. AISIN’s U.S. subsidiary, AISIN U.S.A. MFG., announced that it received IATF 16949:2016 certification in February 2026, describing stronger standardized processes and earlier risk identification as benefits. AISIN: IATF 16949 certification

AIAG, an industry group led by North American OEMs, defines the Production Part Approval Process (PPAP), which is closely linked to IATF 16949 implementation. AIAG: PPAP

An alternative supplier means more than the existence of another gear manufacturer: it must be able to supply the target transmission to the automaker’s volume-production specification and quality-record requirements.

4. The EV transition is not a uniform replacement

In 2021, BorgWarner announced “Project CHARGING FORWARD,” aiming to raise the share of revenue associated with EVs from under 3% to about 45% by 2030, including a plan to sell US$3–4 billion of combustion-related businesses. BorgWarner: Project CHARGING FORWARD

In 2026, CVT specialist Jatco developed a “3-in-1” unit integrating a motor, inverter, and reduction gear. It explicitly says it reused gear-machining technology and topology design developed through its transmission manufacturing. Jatco: 3-in-1 and 5-in-1 units

In an agreement with Subaru to jointly develop an eAxle for BEVs, AISIN said it would consider sustaining and developing the existing supply chain as electrification changes the business environment. AISIN/Subaru: Joint eAxle development

At the same time, ZF said in its FY2025 results that it had ended several unprofitable e-mobility businesses earlier than planned. ZF: FY2025 results GM’s combination of EV conversion at Toledo with additional investment in 10-speed automatics shows that conventional transmission demand and new EV drivetrain demand can coexist by region and vehicle type. The simplification that “transmissions are disappearing and EVs are uniformly replacing them” does not fit these primary sources.

5. Circularity is more than turning a product into metal scrap

AISIN’s environmental activities include resource recovery from foundry sand waste, metal shavings, and scrap. The company also runs automatic-transmission remanufacturing in Japan, Europe, and North America. A remanufactured product is not simply a returned transmission resold as is; it is disassembled, inspected, repaired or replaced, and supplied with a performance guarantee. The volume of returned units and remanufacturing capacity are therefore different measures. AISIN: Remanufacturing

Bottlenecks and business opportunities

Evidence scope and next research steps

Data and primary sources