LATAM Automotive Lubricants Market- By Base Oil, By Application, By Vehicle Type, By Grade & By Country Analysis - Forecast(2024 - 2030)

LATAM Automotive Lubricants Market Overview

LATAM Automotive Lubricants Market is forecast to reach $7.76 billion by 2030, after growing at a CAGR of 2.6% during 2024-2030. Growing demand for lightweight and high-performance vehicles in LATAM along with increasing disposable income is expected to be a key factor driving the LATAM automotive lubricants market growth during the forecast period.

Lubricating oils can come in three main types: synthetic, plant-based, or petroleum-based. The production process for petroleum-based oils involves five key steps: exploration, drilling, transportation, refining, and treatment. These oils primarily consist of crude petroleum, natural gas, and chemical additives like antioxidants, detergents, and viscosity improvers.

The market for high-performance lubricants is on the rise, propelled by increasing demand from the construction and power generation industries. However, challenges such as the growing popularity of electric and hybrid vehicles, extended lubricant lifetimes, and stricter environmental regulations also impact the industry.

Market Snapshot:

COVID-19 Impact

The COVID-19 pandemic significantly impacted the Latin American automotive lubricants industry, causing a downturn in demand due to reduced vehicle usage, especially in years of 2021 and 2022, and economic slowdown. Lockdown measures and supply chain disruptions hindered production and distribution. With automotive sales declining, lubricant consumption followed suit. Recovery efforts faced challenges due to lingering economic uncertainty and fluctuating consumer behavior. Despite the challenges, the industry adapted with innovation in marketing strategies and product offerings to navigate the evolving landscape and gradually rebound.

Report Coverage

The report: “LATAM Automotive Lubricants Market – Forecast (2024-2030)”, by IndustryARC, covers an in-depth analysis of the following segments of the LATAM Automotive Lubricants Market.

By Product: Engine Oil, Gear and Brake Oil, Transmission Fluids, Greases, Others

By Base Oil: Mineral Oil, Synthetic Lubricants, Semi-Synthetic Lubricants, Bio-based Lubricants, Others

By Vehicle Type: Passenger Vehicles, Light Commercial Vehicles, Medium and Heavy-Duty Vehicles

By Geography: Brazil, Argentina, Chile, Colombia, Uruguay, Rest of LATAM

Key Takeaways

• Engine oil segment holds major share of the LATAM automobile lubricants due to growing production of vehicles across the globe and rising consumer awareness regarding the use of oil.
• The LATAM automotive lubricants market is growing due to increasing demand for brake fluids, engine oils and transmission fluids among both consumer and commercial automobiles.
• Shift in trend towards green derivatives is also expected to drive the market over the forecast period.

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LATAM Automotive Lubricants Market Analysis - By Product 

Engine Oil segment holds the largest share in LATAM automotive lubricants market in 2023. Engine oils are widely used to lubricate internal combustion engines and are generally composed of 75-90% base oils and 10-25% additives. They are typically used for applications, such as corrosion protection, wear reduction and smooth operation of engine internals. They function by creating a thin film between the moving parts for enhancing the transfer of heat and reducing tension during the contact of parts. High-mileage engine oils are in demand lately, owing to the properties that help in the prevention of oil leaks and the reduction of oil consumption. The growing urban population in developing countries and the increasing average age of passenger cars are the major factors expected to drive the market for engine oils.

LATAM Automotive Lubricants Market Analysis - By Base Oil

Mineral Oil segment held a significant share of the LATAM automobile lubricants market in 2023. A wide variety of additives are incorporated into most lubricants. These include corrosion inhibitors, antioxidants, friction modifiers, viscosity index improvers, and anti-wear additives. Lubricants are manufactured through base oil and additives which are derived from petroleum sources such as shale oil, crude oil and CBM. These are further refined to produce mineral oils such as naphthenic oils, paraffinic oils and aromatic oils. These oils in combination with additives give lubricants that find applications in automotive. Lubricating oils used in environments in which the oil is subject to mechanical agitation in the presence of a gas entrap the gas in the form of small gas bubbles in the oil and as foam. Therefore, an anti-foaming agent is added to lubricating oils used in such environments to reduce the foaming and air entrainment

LATAM Automotive Lubricants Market Analysis - By Vehicle Type

Passenger vehicles segment held a significant share of the LATAM automobile lubricants market in 2023. The large share of this segment is mainly attributed due to the presence of a large number of on-road passenger cars, growing production and ownership of passenger and general utility vehicles, and high awareness regarding maintenance and use of lubricants among car owners. The sales of passenger cars in South America were 3.159 million units in 2023. On the other hand, a light-weight commercial vehicle is projected to grow at the fastest CAGR during the forecast period due to growing need for transportation of goods and services and people; and growing penetration of light-weight commercial vehicles in rural and semi-urban areas. 

LATAM Automotive Lubricants Market Analysis - Geography

Brazil dominated the LATAM automotive lubricant market with a share of more than 40% during the forecast period. Brazil automotive industry is anticipated to witness high growth rate over the forecast period owing to rapid mega construction projects and economic development. The vehicle production in Brazil increased by 5.1% in 2023. Also, according to the International Association of Oil & Gas Producers (IOGP), Brazil’s daily output of crude oil was 3.02 million barrels per day on average in 2022.

LATAM Automotive Lubricants Market Drivers

Increasing need for transportation:

The growing demand for vehicles across the world will be a direct growth factor for accessory industries for automotive, which includes automotive lubricants as well. An increasing need for individualized transportation options and rising per capita income has driven the sale of cars in several countries. OEMs are thus ramping up their production capabilities in order to meet growing regional and export demand. The strong OEM recommendations to use high-grade lubricants in their cars will result in a higher number of vehicles to perform well while using specified automotive lubricants. Hence, increasing production of vehicles due to the increasing need for transportation is expected to drive the LATAM automotive lubricants market.

LATAM Automotive Lubricants Market Challenges

Crunch in raw material supply:

With depleting crude oil reserves, the market has witnessed a crunch in raw material supply. Hence, major oil companies have started to focus on developing new refining techniques, and sources to overcome this obstacle.

Rise of Electronic Vehicles:

Engine oil and other such lubricants are used in internal combustion engine. However, electric and hybrid vehicle instead use electric motors to operate. These electric motors only have one moving part, which are generally lubricated by lubricants with high lifetime.

LATAM Automotive Lubricants Industry Outlook

Technology launches, acquisitions and R&D activities are key strategies adopted by players in the LATAM automotive lubricants market. The key companies of LATAM automotive lubricants market are:

1. Exxon Mobil Corporation
2. FUCHS PETROLUB SE
3. Motul
4. Phillips 66 Company
5. Repsol S.A.
6. SK lubricants Co., Ltd.
7. Klüber Lubrication München SE & Co. KG
8. Amsoil Inc.
9. Petróleo Brasileiro S.A.
10. Aramco (Valvoline, Inc.)

Recent Developments

• In May 2022 Shell plc completed the sales of the lubricants division in Brazil to Raizen. This decreased Shell plc's market presence in Brazil's lubricants market. 

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