Automotive Fuel Tank Market Trends

Growth Drivers

• Growing pressure for lightweighting of vehicles: The ongoing pressure to reduce overall vehicle weight to improve fuel efficiency and lower emissions is a major driver for the fuel tank market. Automotive manufacturers increasingly replace heavy steel fuel tanks with lighter plastic ones, fueling robust demand for premium blow-molded products. The trend is evident in the strategic overhauls of component manufacturers, as seen in the case of Lumax Cornaglia Auto Technologies, which announced a major shift towards the manufacturing of plastic fuel tanks in September 2024. The joint venture anticipated that the light-weight components would account for over half of its revenues by 2026.
   
• Rising use of alternative fuel vehicles: Growing momentum for alternative fuels, particularly hydrogen, is creating new and lucrative growth prospects for specialty fuel tank makers. With the world seeking to decarbonize mobility, the need for high-pressure vessels as well as cryogenic storage units for vehicles that run on hydrogen is expanding. An example of this was highlighted in September 2023, when Plastic Omnium began the development of Europe's largest hydrogen tank manufacturing plant in France. The facility, which is expected to have a yearly capacity of 80,000 hydrogen containers, will supply key commercial vehicle makers like Stellantis.
   
• Consumer-friendly policies for hybrid cars: Stimulating government incentives, such as tax credits for hybrids, are significantly expanding their adoption, and with it, the demand for specialized fuel tanks designed for these advanced architectures. Hybrid cars require specially configured tanks to accommodate dual-power sources and treat fuel vapor emissions differently from traditional ICE cars. One of the key developments pushing this growth was in January 2024, when India's Trade Department endorsed a proposal to cut duties on hybrid vehicles significantly. The policy move is designed to accelerate the move towards cleaner vehicles and drive the local component ecosystem.

Natural Gas Demand Drivers & Impact on Automotive Fuel Tanks

Source: GECF

Challenges

• Uncertainty due to accelerating powertrain electrification: The rapid and mounting industry-wide shift to all battery electric vehicles (BEVs) poses a serious threat to the conventional fuel tank business. While the large automakers wager on all-electric futures, the long-term demand for gasoline, diesel, and even hybrid fuel tanks is imperiled by structural weakening, creating long-term uncertainty for suppliers. This issue was brought into focus in July 2025, when Mercedes-Benz presented its strategy of launching 18 new EV and PHEV models by 2026. The company's corporate goal to achieve a minimum of 50% of global sales through electrified vehicles by 2030 fundamentally redefines its future supply chain requirements.
   
• Increasing levels of complexity and stringency of fuel efficiency regulations: Automotive fuel tank producers continually face the challenge of producing products that enable OEMs to comply with increasingly stringent global fuel consumption and emissions laws. Regulations are apt to introduce new test cycles and extend their scope, necessitating continuous innovation and investment in new technology to remain compliant. In September 2024, China's Ministry of Industry and Information Technology published its Stage 4 heavy-duty vehicle fuel consumption standard. This new rule tightens fuel consumption limits by 12-16% and includes an additional stricter test cycle, which presents big engineering challenges to the manufacturers.