Automotive Plastics Market Boosted By The Increasing Production Of Vehicles Especially Passenger Cars

The increase in the number of vehicles produced and a need for incorporating a fuel-saving design in them is creating a profitable demand for automotive plastics such as polyurethane, polypropylene, polyvinyl chloride (PVC), polyamide, and polyethylene. There is a discernible requirement for reducing CO₂ emissions that are proving to be detrimental to the environment, and this is creating a need for producing lightweight vehicles that consume less fuel and therefore, emit less CO₂, which aids to the “low-carbon economy” trend. This is the major factor creating growth prospects for the automotive plastics market players. Furthermore, the automotive industry is in a transition phase, and the electric vehicles (EVs) and autonomous vehicles are making a perceptible penetration in the industry, which is instilling momentum in the automotive plastics market. The international and government initiatives for the reduction of CO₂ emissions are also increasing the automotive plastics market size. There is a trend of the application of biodegradable and engineering plastics in the automotive original equipment, which is disrupting the automotive plastics market. Additionally, 3D printing has penetrated in the automotive industry, which is also acting as a disruptive factor in the Automotive Plastics Market. As of 2018, the automotive plastics market size was evaluated at $27.5 billion, and it is poised to escalate at a profitable CAGR of 2019-2025.

According the International Trade Centre (ITC), the trade value of polymers of styrene was valued to be $26.67 trillion in 2018. The trade had observed a growth of 11% year on year, which is significantly attributable to the demand for ABS (Acrylonitrile-Butadiene-Styrene (ABS) copolymers) from the automotive industry. ABS is a significant segment of the automotive plastic, and therefore, the growth in the trade of ABS signifies the demand influx in the automotive plastics market.

Automotive Plastics Market Scope in APAC – Opportunities for the Players:

APAC had the greatest automotive plastics market share with 34% in 2018. There were many factors such as the growth of the automotive industry in China and India and other disruptions like the increasing usage of lightweight vehicles with abundant plastic content that played role in the growth of the APAC automotive plastics market size. The scope for the automotive plastics market players in APAC can be further fathomed by the number of vehicles that were produced in the countries as assessed by the International Organization of Vehicle Manufacturers Association (OICA) and the amount of ABS imported as evaluated by ITC.

Here are two tables that signify the opportunities in the APAC automotive plastics market –

Table 1 – The Production of Vehicles in Countries of APAC

Vehicle production data source – OICA

Conspicuously, APAC witnessed a substantial number of vehicles produced in 2018, which reflected as the growth in import of the products that belong to the parent industry of ABS in these countries, as shown in table 2 –

Table 2 – The Import Values Pertaining to ABS’s Parent Industry in Various Countries of APAC

Import data source – ITC

The above two tables with figures are the evidence of the growth of the automotive plastics market in the aforementioned countries of APAC. Here are some factors that are impacting the growth and will be acting as effective automotive plastics market forces during the forecast period –

· The Growth Prospects for the APAC Automotive Plastics Market Players in China –

According to the findings by the International Trade Administration (ITA), China houses the world’s largest automotive industry, and it had experienced total sales of over 28 million units in 2016, and the figured had undergone a substantial growth of 9% as compared to 2015. Based on statistical analysis and resource assessment, the Chinese Central Government expects that China’s automobile industry’s productivity will reach 30 million and 35 million units by 2020 and 2025 respectively. Now, this growth of the automotive industry in China will create a profitable demand influx in the associated industries, and thus, the automotive plastics market will be observing an increase in revenues from APAC.

Furthermore, the self-driving cars and trucks market in China is going to make strides, which is quite evident with the fact that the country is creating a dedicated highway lanes for the self-driving car. The growing trend of the self-driving cars in China will create the automotive plastics market revenue sources.

· The Scenario of the Automotive Industry in India and the Impact on the Automotive Plastics Market –

FDI inflows in the Indian automobile sector stood at $20.85 billion between April 2000 and December 2018, according to the India Brand Equity Foundation (IBEF). The revenues of the automotive industry in India is going to further catapult, because there is an increase in the middle-class income across the country, which is allowing people to purchase vehicles. This is reflecting in the expansion of Indian automotive industry, and it is quite evident with the way market players are investing in expansion projects. For instance, Maruti Suzuki India is planning to expand its capacity to 750 thousand units in the Gujarat plant, which will take its total capacity to 2.25 million units a year. Such expansion projects in the Indian automotive industry is going to create a demand influx in the automotive plastics market.

· The Impact of Increasing CO₂ in Countries of APAC Inducing a Demand for Lightweight Vehicles –

The following table shows the growing concern pertaining to CO₂ emissions in APAC, which is proving to be a passive yet effective driving factor in the expansion of the automotive plastics market. Here’s the table that indicates CO₂ emissions in APAC countries –

Table 3 – CO₂ Emissions in Countries of APAC  

CO₂ emissions data source – World Bank

From the above figures and statistics by World Bank, it is clear that CO₂ emissions have been a concern. A substantial part of these figures are attributable to the CO₂ emissions from the transportation sector, and it has become imperative for the automobile industry vendors to produce vehicles that aid to the reduction of the same. This is leading to an augmented production of lightweight vehicles, which is creating a demand influx in the automotive plastics market.

Key Application Segment in the Automotive Plastics Market – Passenger Cars:

The key application of the automotive plastics market is in the passenger cars segment, and it is poised to grow at a substantial CAGR of 11.77% through to 2025. This is attributable to the increasing purchasing power of the customers is leading to a favorable pricing environment for the manufacturers of passenger cars. According to OICA, 70.5 million number of passenger cars were produced globally, which created a sustainable automotive plastics marketplace. The affordability factor and the electric cars demand is going to increase the number of passenger cars production even further, which will support the automotive plastics market.

Automotive Plastics Market – The Global Scenario and Key Growth Drivers and Trends Disrupting the Dynamics of the Industry:

Apart from the increasing production of vehicles and the advent of electric vehicles (EVs) and semi-autonomous and autonomous vehicles, these are the factors that are acting as tangible automotive plastics market forces –

· Global CO₂ from the Transportation Sector: A Concern Creating Demand Influx in the Automotive Plastics Market –

According to the latest findings by World Bank, the fraction of CO₂ emissions from the transportation sector was evaluated at 20.449% in 2014. International Energy Agency (IEA) had gauged CO₂ emissions from fuel combustion, and the figure was 32.31 GtCO₂ – similar to that in 2015. Furthermore, the organization has assessed that the emissions are more than doubled as compared to the seventies and experienced an increment of 40% since 2000. This is having a subsequent effect on the automotive industry, because the manufacturers are now striving to produce lightweight vehicles as international organizations and governments are enforcing regulations pertaining to CO₂ emissions from vehicles. For instance, there is a National Program for Greenhouse Gas Emissions (GHG) and fuel economy standards for light-duty vehicles (passenger cars and trucks), which is making it imperative for the vehicle manufacturers in the US to instill ecofriendly production, and this is increasing the automotive plastics market demand in the country, as the increase in plastic content reduces the weight and aid to the reduction of CO₂ emissions. Similarly, regulatory organizations across the globe are coming up with compliances, which is creating a demand influx in the automotive plastics market.

· Prominence of Biodegradable and Engineering Plastics In the Automotive Plastics Market –

Mid 2018 witnessed the first car that was made entirely from biodegradable plastic, which was created by a team of 22 students of Eidhoven University of Technology. The vehicle was found to be half the weight of a regular car. Bio-plastics are poised to be a commonplace in the automotive industry. Moreover, engineering plastics market finds a lucrative application in the automotive industry. These two trends are going to disrupt the automotive plastics market during the forecast period.

· The Emergence of 3D Printing: A Disrupting in the Automotive Plastics Market –

3D printing in automotive market is booming, and this will have an impact on the automotive plastics market. There is a growing concern of plastic wastage across the globe; part of which is attributed to the application and subsequent wastage of plastic during the manufacturing of vehicles. However, 3D printing will be reducing the plastic wastage from the automotive industry as it will enable a manufacturer to cut the exact amount of plastic that is required for the production of vehicles. In the upcoming years, the application of 3D printing will act as disruptive factor in the automotive plastics market and also help automotive manufacturers reduce plastic wastes.

Automotive Plastics Market – Competitive Landscape:

The major players striving to increase their automotive plastics market share are Magna International Inc., Lear Corporation, Adient plc, BASF SE, Plastic Omnium, Borealis AG, Covestro AG, Evonik Industries AG, SABIC, Grupo Antolin, DowDupont Inc., and Momentive Performance Materials, Inc.

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Related Reports:

a) Polymers Market

https://www.industryarc.com/Report/18767/polymers-market

b) Automotive Plastic Additives Market

https://www.industryarc.com/Research/Automotive-Plastic-Additives-Market-Research-501038

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