Rising global temperature, changing customer requirements, the introduction of stringent government regulations regarding safety and emission reductions, and rising traffic congestion are some of the factors that are compelling all the industries to build more sustainable business environments. The impact of these factors has been the most on the automotive industry with this decade being the most disruptive one with several megatrends collectively transforming the industry. Among many megatrends, the most noticeable ones are autonomous, emission-free mobility, fuel efficiency, sharing, and connected vehicles. Today, almost all the major automakers are putting efforts into the development of vehicles addressing most of these trends. 

Among these megatrends, the development of fuel-efficient vehicles is equally imperative which has efficaciously been being unraveled by automakers by making essential changes in the materials, vehicle design, geometry, aerodynamics, etc. They have been meticulously leveraging the potential of fluoropolymers in the critical sections of the vehicle to address the tightening carbon emission standards of governments or regulatory authorities regarding fuel efficiency enhancements.

In the year 2020, automotive production has been facing severity in the first quarter, which may be expected to prolong to the entire year. The outbreak of coronavirus has led to the shutdown or has idled several auto assembly plants, especially in China. After a couple of months of the outbreak, the impact of novel coronavirus has also started visibly in other Asian countries and European markets. For instance, Hyundai, which has one of the world’s largest plant networks in South Korea, having a production potential of 1.4 million units, has been shut down its plants in South Korea on an account of a shortage of parts from China and the widespread of the virus in South Korea. Similarly, the leading European auto giants, such as FCA, Renault, and BMW, are also shutting down plants in Europe owing to the increasing spread of the virus in the European countries.

Despite the decline in the past two years and the expected decline in 2020, the long-term outlook of the automotive fluoropolymers market still looks favorable with an expected bounce back in the market from 2021 onwards. Currently, the automotive industry accounts for less than 16% of the total fluoropolymers consumption in terms of volume; however, the industry is indisputably one of the fastest-growing end-use segments of fluoropolymers, outpacing the average industry growth, propelled by an incessant rise in the penetration of fluoropolymers in various applications including seals and hoses, especially for charge air coolers. The demand for charge air cooler has been at pinnacle because of the rising demand for turbocharged vehicles in both gasoline as well as diesel vehicles, giving an impetus to the demand for fluoropolymers and creating new revenue pockets for the market participants.

The growth in the demand for fluoropolymers in the automotive industry has been outpacing the growth of the overall automotive industry for the last two eons. It is estimated that this growth momentum is likely to maintain in the long-term scenario, assisting the market to cross the unprecedented landmark figure of US$ 1.2 billion by 2025. An expected recovery of automotive production from 2021, a paradigm shift from combustion vehicles to electric vehicles, introduction of stringent carbon emission standards by major economies, growing trend towards engine downsizing,  increasing penetration of turbochargers, and rising safety, as well as friction reduction requirements for reduced maintenance, are some of the key whys and wherefores behind the exceptional growth in the demand for fluoropolymers in the automotive industry.

Lucrative expected future growth of the market is compelling the market participants to expand their existing production capacities. For instance, on Oct. 2019, The 3M Company announced to increase the capacity of FKM at its plant in Decatur, Alabama (the USA), which is scheduled to begin operation by 1st quarter 2021. Similarly, in late 2019, Solvay S.A has announced that it will increase the production of its Solef® PVDF (polyvinylidene fluoride) high-performance polymers in Changshu, China, by more than 50%. The operation is scheduled by the first half of 2022.

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Automotive Fluoropolymers Market Insights:

By Vehicle Type:

The automotive fluoropolymers market is segmented based on vehicle type as passenger car, LCV, and M&HCV. Passenger car is expected to remain the largest market vehicle type segment over the next five years. The vehicle type (passenger car) is also likely to witness the highest growth during the same period. Large production of cars coupled with high penetration of fluoropolymers has led to the huge dominance of the segment in the market.

By Product Type:

Based on the product type, the automotive fluoropolymers market is segmented as PTFE, FKM, PVDF, and others. FKM is likely to remain the most dominant fluoropolymer type in the automotive industry during the forecast period. The segment is also likely to witness the highest growth during the same period. FKM is a preferred choice of material in various fuel system applications, such as fuel cap main seal, fuel rail seal, fuel filler hose, fuel pump seal, and fuel injector seals.

By System Type:

Based on the system type, the automotive fluoropolymer market is segmented as powertrain system, fuel system, air management system, and others. Fuel system is the major application area of fluoropolymers and is likely to maintain its dominance in the market in years to come, whereas air management system is likely to be the fastest-growing segment of the market during the same period. The key applications of fluoropolymers in air management system, such as SCR injector seals, muffler seals, EGR stem seal, turbocharger hoses and seals, throttle seal, oxygen sensor seal, and air intake manifold gasket, are experiencing significant growth; thereby, pushing the growth of the segment.

By Region:

In terms of region, Asia-Pacific is projected to remain the largest automotive fluoropolymers market during the forecast period in terms of both value and volume. China and India are the growth engines of the Asia-Pacific’s market. The recent outbreak of novel coronavirus has a severe impact on automotive production, especially in China. Many of the auto assembly plants have been shut down or are idled, which may significantly impact the demand for fluoropolymers in the region’s automotive industry in the year 2020.

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• Emerging trends
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• Key success factors

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