Increasing demand for better aesthetics and interior and growing demand for commercial and passenger vehicles in addition to the flourishing automotive exports propelling the market for automotive plastics, which is expected to witness 9% CAGR during the next ten years, an analysis by Future Market Insights (FMI) said.
According to the market intelligence and consulting services provider, the global automotive plastics market is expected to surpass a valuation of $ 9.5 billion by the end of 2021, reaching a market volume of around 7.5 million tonne.
Some of the key players operating in the automotive plastics market include BASF SE, SABIC, Dow, AkzoNobel, Covestro, Evonik Industries, Borealis, Royal DSM, Magna International and Teijin.
Quoting the China Association of Automobile Manufacturers, the report said that the country exported about 34,000 commercial vehicles and 117,000 passenger cars in April 2021.
Due to their characteristics such as lightweight, resistance to abrasion, scratch proof, and high impact toughness, automotive plastics are considered ideal choices for manufacturing bumpers, fenders, doors, and other automotive components. Therefore, the increasing number of passenger cars is estimated to present lucrative sales opportunities for the market over the coming years, the report said.
Polypropylene plastics are preferred much
According to FMI, polypropylene plastics are likely to dominate the material segment owing to the increasing demand for lightweight components by OEMs and high vehicle production rates.
FMI analyst said that to abide by government regulations towards environmental safety, automotive manufacturers prioritise reducing vehicle weight. This also is intended to curb carbon emission. Such policies adopted by automakers are creating demand prospects for the automotive plastics market.
The survey finds that strict regulatory policies implemented by the government to curb vehicular carbon emission are fueling the demand for automotive plastics in Brazil.
The market in Russia is likely to demonstrate steady growth due to rapid advancement in the electric vehicle section in the country.
The China market is expected to dominate the BRIC countries on fueled by high commercial and passenger vehicle sales.
India is anticipated to emerge as a lucrative market supported by increasing usage of automotive plastics for manufacturing exterior and interiors components of vehicles.
In terms of material, the acrylonitrile butadiene styrene (ABS) segment will expand at a robust pace favoured by increasing application in vehicle interior design, the research firm said.
The key drivers, according to FMI, include surging demand for commercial and passenger vehicles that spur the sales of automotive plastics.
In addition, increasing government regulations to curb vehicular carbon emission, rising demand for lightweight and the growing consumer inclination towards passenger cars with an attractive interior heighten the sales of automotive plastics, the report said.
However, the high cost of automotive plastics compared to metals such as aluminium is hampering the market growth. Besides, the lack of technologies and infrastructure required for the re-engineering of plastic is restraining the development of the market. Moreover, the increasing awareness regarding adverse effects due to the use of plastic is posing a challenge for the market growth, FMI said.
Major players operating in the automotive plastics market are increasingly investing in research and development to develop innovative products and improve the value chain. In addition, the market players are also engaging in strategic collaboration with distribution channels players, primarily regional, to address increasing customer demands.
For instance, in March 2019, BASF SE, a leading multinational chemical company, announced a new R&D centre in Shanghai, China. This particular automotive application centre aims to develop innovative products faster and address the surging demand from various exterior and interior automotive applications.
Courtesy: Future Market Insights. NB: Photo is representational; courtesy: Mercedes-Benz.