The chemical industry is a major component of the economy. According to the U.S. Bureau of Economic Analysis, in 2020, for the U.S., the value added by chemical products as a percentage of GDP was around 1.9%. Additionally, according to the World Bank, Chemical industry in the U.S. accounted for 16.43% to manufacturing value-added in 2018. With the growing demand from end-users, the market for chemical products is expected to grow in future. According to UNEP (United Nations Environment Program), the sales of chemicals are projected to almost double from 2017 to 2030. In the current scenario, Asia Pacific is the largest chemical producing and consuming region. China has the world’s largest chemical industry, that accounted for annual sales of approximately more than USD 1.5 trillion, or about more than one-third of global sales, in recent years. Additionally, a vast consumer base and favorable government policies have boosted investment in China’s chemical industry. Easy availability of low-cost raw material & labor as well as government subsidies and relaxed environmental norms have served as a production base for key vendors globally. On the other hand, according to the FICCI (Federation of Indian Chambers of Commerce & Industry), the chemical industry in India was valued at 163 billion in 2019 and it contributed 3.4% to the global chemical industry. It ranks 6th in global chemical production. This statistic shows the lucrative opportunity for the investment in businesses in Asia Pacific countries in the upcoming years.
Growth Drivers
Rising Middle Income of Population - With the increase of middle income, people are turning towards adopting upgraded version of vehicles for more comfort. Automotive plastics which are useful component for manufacturing lightweight vehicles with fuel-efficient properties and enhanced on-road performance are preferred option for the population. Thus, with the rising income levels, the adoption rate of automotive plastics is anticipated with the expansion of the market. According to World Bank, the total population with middle income in the world rose from 5.51 Billion in 2015 to 5.86 Billion in 2021.
Escalation of Vehicles Production - As per Organization of Motor Vehicle Manufacturers, the global production of vehicles was 80 million units in 2021. This is a rise from 77 million units in 2020.
High Demand of Electric Cars by Population - A latest report by the International Energy Agency stated the number of electric cars on the road was 16.5 million in 2021.
Increased Number of Vehicles on the Worldwide Roads – A recent report estimated that there were approximately 2 billion vehicles on roads across the globe by the end of first quarter of 2022.
Challenges
The automotive plastics market is segmented and analyzed for demand and supply by vehicle type into conventional cars and electric cars. Out of these, the conventional cars segment is anticipated to garner the highest market share by 2033, owing to rising demand of passenger cars around the world. vehicles by the burgeoning population. International Organization of Motor Vehicle Manufacturers (OICA) revealed the sales of global passenger vehicles to be 53 million in 2020 and the production to be 55 million in the same time period.
Regionally, the global automotive plastics market is studied into five major regions including North America, Europe, Asia Pacific, Latin America and Middle East & Africa region. Amongst these markets, the market in Asia Pacific is projected to hold the largest market share by the end of 2033. The rising the population along with their income levels have increased the demand of vehicles which, in turn, is expected to bring lucrative growth opportunities for automotive plastics market. The total production of vehicles in the region was 46 million in 2021, whereas, the total sales in the region was 42 million in 2021 as per statistics released by International Organization of Motor Vehicles (OICA). Also, the presence of leading key players and exporters in the region is an another factor that is expected to affect the market positively. China, a country of Asia Pacific is estimated to have exported around 402,000 commercial vehicles and around 2 million passenger vehicles in the year 2021.
The global automotive plastics market is further classified on the basis of region as follows:
Our in-depth analysis of the global automotive plastics market includes the following segments:
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In 2023, market players might incur losses due to huge gap in currency translation followed by contracting revenues, shrinking profit margins & cost pressure on logistics and supply chain.
Controlling Inflation has become the first priority for global economies from last quarter of 2022 and to be followed in 2023. With skewed economic situations, rise in interest rate by governments to control spending and inflation, spiked oil and gas prices, high inflation, geo-political issues including U.S. & China trade war, Russia-Ukraine conflict to intensify the global economic issues.
The interest rates in the U.S. may be less sensitive in 2023 as compared to 2022; sigh of relief for businesses. Positive business sentiments, healthy business balance sheets, growth in construction spending (private construction value in 2022 stood at $1,429.2 billion, 11.7 percent (±1.0 percent) above the $1,279.5 billion spent in 2021, Residential construction in 2022 was $899.1 billion, up by 13.3 percent (±2.1 percent) from $793.7 billion in 2021, non-residential construction touched $530.1 billion, 9.1 percent (±1.0 percent) above the $485.8 billion in 2021.) showcases minimal impact of recession in the country.
Similarly, spiked spending in the European and major Asia economics including, India, China & Japan to showcase less impact on the global demand.
Ans: The expansion in automotive industry and the increased demand for vehicles is expected to fuel the market growth in the future.
Ans: The market is anticipated to attain a CAGR of ~5% over the forecast period, i.e., 2023 – 2033.
Ans: The high cost of capital and infrastructure along with the increasing concerns regarding plastic recyclability and rising governmental policies regarding pollutants emission are some of the factors that are expected to hamper the market growth.
Ans: The market in Asia Pacific is projected to hold the largest market share by the end of 2033 and provide more business opportunities in the future.
Ans: The major players in the market are Arkema, BASF, Saudi Basic Industries Corporation, LyondellBasell Industries N.V., LG Chem, DuPont de Nemours, Inc., Covestro AG, Evonik Industries AG, Solvay Group, Borealis AG, and others.
Ans: The company profiles are selected based on the revenues generated from the product segment, geographical presence of the company which determine the revenue generating capacity as well as the new products being launched into the market by the company.
Ans: The market is segmented by product, application, process, vehicle type, and by region.
Ans: The conventional cars segment is anticipated to garner the largest market size by the end of 2033 and display significant growth opportunities.
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