Silica Aerogel Market Trends

Growth Drivers

• Expansion in the electric vehicle battery industry: The rapid international transition to electromobility is a strong new driver for the silica aerogel market globally. Silica aerogel’s outstanding form-factor flexibility and thermal resistance have made it a suitable material for thermal insulation and barriers within the EV battery sector, which is essential for removing thermal runaway and enhancing safety. According to the 2024 IEA Organization article, there has been a surge in EV battery demand, reaching over 750 GWh as of 2023, denoting a 40% increase since 2022. In addition, electric cars readily account for 95% of the growth, and internationally, this growth took place, owing to an increase in EV sales, while the remaining 5% growth derived from a larger average battery size, thus suitable for the market’s growth.
• Increasing demand from the oil and gas sector: The oil and gas industry is considered a mature application, which continues to be one of the major customers to utilize aerogel blankets for pipeline insulation, offshore platforms, and LNG facilities. The purpose is to combat corrosion under insulation and optimize process efficiency, which is driving the silica aerogel market’s growth. As per the 2025 IEA Organization report, the worldwide demand for oil increased due to a rise in consumption by 0.8%, which is from 1.5 EJ to 193 EJ, after jumping by 1.9% in 2023. Meanwhile, in the case of natural gas, there has been an increase in demand by 2.7%, which is 115 billion cubic metres (bcm) as of 2024. This denotes a 2.0% yearly growth rate from previous years, which is positively impacting the market’s development.
• Economic viability through manufacturing advancement: The aspect of continuous research and development (R&D), along with scaling of production processes, is steadily lowering the increased expense of aerogel manufacturing. This is further improving the return on investment (ROI) and making it accessible for a wide range of applications, which include construction. According to an article published by the World Manufacturing Foundation in October 2024, globalization has significantly developed interdependencies, based on which China is the U.S.’s primary trading partner, accounting for an estimated USD 860 billion. Besides, the international diversification of severe supply chain has increased foreign investments for setting semiconductor manufacturing centers in Malaysia, with an investment of USD 13.5 billion as of 2023.

Challenges

• Handling and fragility limitations: The intrinsic fragility of conventional silica aerogel monoliths has posed a substantial risk for many applications, which is negatively impacting the overall silica aerogel market globally. While aerogel blankets have combated this for industrial utilization, the base material is brittle and can produce dust upon handling, which has limited its utilization in applications that require structural integrity or clean environments. This dust, in turn, can also be irritant, demanding safety protocols during installation. Besides, the mechanical weakness has complicated its integration into composite materials without careful engineering to overcome crushing or cracking under load. This particular property has excluded itself from different potential applications in load-bearing and dynamic environments, including structural building elements or automotive body parts.
• Intensified competition from established insulation materials: The silica aerogel market is significantly dominated by well-entrenched and low-cost insulation materials. Products such as mineral wool, polyurethane, and polystyrene foam comprise established supply chains, a proven track record, and familiar installation protocols, which make them the default option for various contractors and engineers. Besides, the performance benefit of aerogel, while being technically superior, is frequently not compelling enough to justify increased cost for standard applications. These conventional materials continue to witness incremental optimization in their respective performance and fire resistance, further narrowing the value proposition barrier.