Market report Bright future for automotive plastics market
According to a new market research report the global automotive plastics market size for passenger cars is projected to grow from 21.1 billion dollars in 2021 to 30.8 billion dollars by 2026, at a CAGR of 7.9 percent during the forecast period 2021 to 2026.
The demand for automotive plastics is mainly driven by passenger car production and the increasing utilisation of automotive plastics in vehicle designs. Plastics offer a maximum weight reduction of automobiles, which in turn reduces carbon emissions. There is also a growing demand for automotive plastics products from developing economies, states Markets and Markets in a recent study.
According to the report, BASF is the largest company in the global automotive plastics market for passenger cars. It offers a well-balanced and diverse product portfolio, addressing the needs of automotive OEMs across all market segments. As a part of its business strategy, the company is focusing on expanding its global presence to strengthen its leadership in the market. The company is expanding its business in the automotive plastics segment through a balanced strategic approach over the past few years. For instance, in August 2020, the company expanded its production capacity through a joint venture with Toyota Motors to come up with lightweight automotive plastic components. The company is also focused on the innovation of new products such as thermoplastics and foams to support automotive interior, exterior, and under bonnet features. The company is coming up with new products like Ultramid and Ultrason in the automotive plastic market, which will help it to make its presence stronger in the market. Most of the company’s business is generated from Europe. The company can further expand in emerging markets such as South America, Asia, Australia, and Africa to diversify its business and distribution network.
Another important player in the automotive plastics market for passenger cars is Sabic which is one of the top three largest chemical companies with over 40 years of organic and inorganic growth. With its diversified product offering, the company has been able to have its footprint globally, serving clients in 100 countries while operating in 50 countries across the Americas, Europe, the Middle East & Africa, and Asia Pacific. Through learning, innovation, and operational excellence, Sabic partners with its customers to responsibly provide them with quality products and services. The company’s strong pillars, such as robust financials, operational excellence, and diversified global coverage, have consolidated its share in the automotive plastic market. Sabic launches new products and has enhanced its scale of operations to become a leading provider of innovative plastic products globally. In the automotive plastic market, the latest collaboration with Xenoy HTX has extended its scope in the automotive market. The company is developing new products by increasing investments in R&D with more than 1,800 scientists and 18 innovation and technology centers to sustain its leading market position. The company is focused on developing new patents and certifications.
PU with largest share of the automotive plastics market
By product type, the PU segment accounted for the largest market share in 2020. PU has various properties such as high stiffness, strength, dimensional stability, high temperature, and abrasion resistance, and low friction characteristics, along with chemical, flame, abrasion, creep, and fatigue resistance, which makes it one of the majorly used plastics. Polyurethanes (PU) are utilized in passenger cars for seat foams, carpet backing, seat overlays, head & armrests, airbag covers, and acoustic insulations. The largest share of PU in terms of value can be attributed to its high cost as compared to other plastics such as PP, PVC, HDPE, among others.
Electric cars are fastest growing segment
By vehicle type, the electric cars segment is expected to be the fastest-growing segment of the automotive plastics market for passenger cars. Electric cars are solely dependent on the lighter parts to improve their driving range as the electrified powertrains enable the exertion of kinetic energy, which decreases the weight reduction. Companies like Volvo have their R&D working on plastics materials that store and discharge electric energy. The plastics are strong and light in weight and enough for the vehicles structural components and body panels. The growth of EVs has improved drastically since 2014 and is expected to register a CAGR of 26.5 percent by the end of 2026. These factors are expected to drive the growth of the electric cars vehicle type segment during the forecast period.
Asia Pacific region accounted for largest market share
Asia Pacific accounted for the largest share of the automotive plastics market for passenger cars in 2020. The countries considered for the study in Asia Pacific are China, Japan, India, South Korea, Thailand, Indonesia, among others. Asia Pacific is a leading manufacturing hub for the automotive industry owing to the increasing passenger vehicle production in China and India. The vehicle production in these countries is growing at a rapid rate because of the presence of major automotive players such as Honda, Toyota, Hyundai, and Nissan. Manufacturers such as BMW and Volkswagen have already set up manufacturing units in these countries. In terms of geography, Asia has the highest production of electric vehicles, making it the largest market for plastic for EVs. Such factors are expected to fuel the growth of the automotive plastics market for passenger cars in the region.