The global automotive plastics market is projected to go beyond 18 million tons by the end of the forecast period (2016-2024). Expanding at a healthy CAGR of over 13.5% during the forecast period, the industry is estimated to report more than USD 66 billion by 2024. Qualities such as high resistance to weathering, versatility in applications, and superior quality of designs make these composites the trendiest forms of automobile design materials. Strict governmental regulations regarding vehicular emissions are driving automotive companies to shift their preference from metals like steel or aluminum to lightweight plastics.
The need for emission control & weight reduction, high demand for automotives, and improved vehicle designs can propel the market. The automotive market for a while now, has been witnessing an escalating trend towards vehicular weight reduction for enhanced fuel efficiency. Demand for plastics is on the rise since these ensure considerable weight reduction. Moreover, regulations, such as the “Corporate Average Fuel Economy” (CAFÉ) by the U. S. government and the European EC legislation focus on fuel efficiency. The implementation of such standards may positively affect the global market.
A 10 percent reduction in vehicular weight results in over 5 to 7 percent fuel savings. This also leads to lower CO2 emission levels over the lifespan of vehicles. Their overall performance in terms of handling and acceleration also improves significantly. Weight reduction at unbalanced points leads to lower vibration & noise. This in turn ensures a smoother ride.
Automotive plastics are used in a number of applications in the overall automobile industry; from screw-on attachments in furnishings to expensive vehicle body parts. With technological innovations in the production of automotive components, thermoplastic elastomers (TPE), along with other superior performance plastics, are finding newer applications in the market. The composition of plastics in an average car ranges from approximately 6 to 10 percent. This depends on the desired level of fuel efficiency & performance standards. This percentage could increase in the future because of growing popularity of fuel efficient, high-performance, and light weight cars.
Apart from reducing vehicular weight, automotive plastics enhance vehicular aesthetics, lower vibrations, noises, & cabin insulation. High costs of raw materials and huge investments may hamper market growth. Additionally, the non-degradable nature of these products could cause recyclability & disposability issues. Most of the products are derived from petrochemicals. Hence, the supply of automotive plastic products depends, to a marked extent, on the availability of crude oil.
The global automotive plastics market is segregated as products, applications, and regions. Based on products, the industry is divided into Polycarbonate, Polyurethane, Acrylonitrile Butadiene Styrene (ABS), Polyvinyl Chloride (PVC), Polypropylene, Polyethylene, Polymethyl Methacrylate (PMMA), and Polyamide. The polypropylene segment dominated the global industry in 2014 with revenues surpassing USD 5 billion. Polypropylene-based products are utilized extensively as substitutes for engineering plastics & metals. The primary aim of such a substitution is cost savings coupled with weight reduction.
Polyurethane automotive plastics contributed to more than 17% of the market in terms of volume in 2014. Also, this segment may expand at more than 10% CAGR over the forecast period. Polyurethane foam offers automotive manufacturers & designers, ways to create seating that can be assembled, disassembled, and recycled efficiently. It also fulfills the highest performance standards across a broad array of firmness without any extra weight. In addition, the transportation industry is a major consumer of reaction injection molded (RIM) polyurethane parts. Polymethyl methacrylate is estimated to be the fastest-growing segment in the forthcoming years. It will expand at a CAGR of nearly 12%.
As per applications, the automotive plastics market includes chassis, electrical components, under the hood, powertrain, and interior & exterior furnishings. Electrical components held the largest market share in 2014. It stood at more than USD 6.6 billion. Vehicle lamp sockets made of superior performance polymer can withstand high temperatures with almost no degradation. These sockets are lightweight & corrosion resistant, which makes them an ideal substitute for metals.
Interior & exterior furnishings held over 32% of the total market shares in 2014. This segment is anticipated to grow at a significant CAGR of over 9% during the forecast period. Steering wheels, body & light panels, fascia systems, and bumper systems are the key automotive components made of plastics. The powertrain segment could grow robustly at a CAGR exceeding 10% in the years to come. Demand for automotive plastics is attributed to the need for internal transmissions & jolt bolts in power trains. Various companies utilize composites for manufacturing internal transmission for parts, like wire harnesses, gear spurs, rotary dampers, belts, extension springs, and pullets.
Geographically, the global automotive plastics market is fragmented into Europe, Asia Pacific, Central & South America, North America, and the Middle East & Africa (MEA). Asia-Pacific dominated the industry in 2014 with revenues that crossed USD 9.6 billion. The proliferation of automotive manufacturing bases in developing countries, such as India, China, Thailand, and Indonesia owes to favorable government incentives and low wages. Several key American and European manufacturers, such as Ford and Volkswagen, have established their manufacturing units in India. This, in turn has led to technology transfer to the APAC region. Also, such an addition made to the technology capital has improved the manufacturing processes of automobile components.
Expanding at a CAGR of nearly 10.6%, Central & South America might be the fastest-growing market during the forecast period. The automotive plastics market in the Middle East & Africa is expected to expand considerably. This is because of the prospering vehicle after-sales industries in countries, such as the UAE and Saudi Arabia.
The global automotive plastics industry is a highly concentrated one. In 2014, five of its leading companies catered to more than half the global demand. Owing to a strong product portfolio and worldwide presence, BASF SE dominated the global market in 2014. This company led the application segment of electrical components. Key companies operating in this industry are Delphi Automotive PLC; The Dow Chemical Company; Evonik Industries A. G., Johnson Controls; Quadrant A. G.; and Akzo Nobel N. V.
Research Support Specialist, USA