Automotive Lubricants Market

The advancing vehicle technology has been creating a headwind for lubricant sales recently. The approximately US$66.5 Bn automotive lubricants market (as of 2021) is projected to observe gradual growth in the next few years.

Market Analysis in Brief

Growing consumer desire for lightweight, high-performance cars in developing nations like China, and India, together with rising disposable income globally, is anticipated to be a major driver for sustaining sales of automotive lubricants. The global automotive lubricants market is being driven by factors such as the rise in the number of on-road cars, the reliance on private automobiles for mobility, the rise in disposable income, economic stability, and growing vehicle affordability.

Rising demand for heavy-duty motor vehicle engine oils to withstand harsh geographic conditions and emission standards in on- and off-highway heavy vehicles is also boosting the automotive lubricants market. There is an increasing need for motor oils with shear resistance and a specific viscosity index because most engines are diesel-powered. It is anticipated that this tendency will support industry growth throughout the projection period. The market is predicted to rise due to additional factors, such as rising consumer spending power and significant research and development (R&D) efforts to enhance oil quality.

Key Report Findings

• The automotive lubricants market registered revenue worth approximately US$66.5 Bn in 2021
• Ascending passenger car parc is largely pushing the sales of automotive lubricants
• Engine oil continues to dominate the automotive lubricants industry
• Synthetic oil is gaining popularity among industry professionals
• Led by China, Asia Pacific spearheads global landscape

Growth Drivers

Growing Need to Safeguard Automotive Systems, and Components

The market acceptance of automotive lubricants is boosted by factors including their durability and vehicle protection. By drastically reducing friction between the pieces, they provide defense against damage to a vehicle's systems and parts. Additionally, the need for low-viscosity and better-performing lubricating oils is continuously growing due to the industry's use of smaller and more complicated automotive systems. This is anticipated to support the invention and development of premium lubricating oils in the upcoming years. The rising standards for high performance in automobiles encourage the use of new products, in turn bolstering the growth of the automotive lubricants market.

Rising Demand for Passenger Cars in Developing Nations

The global automotive industry has grown significantly over the past few decades in terms of markets, manufacturing capacity, and competitive standards, which has led to a rapid expansion of the automotive industries in India, China, Brazil, and South Korea. With their high population density, emerging economies like China, and India have sizable domestic markets. Additionally, rising nations have benefited from foreign direct investment and assisted MNCs in establishing their assembly operations throughout many nations.

Furthermore, new industrial strategies adopted by governments in emerging nations contributed to a rise in the capacity of the automobile sector. The Made in China 2025 project was introduced in China in 2015 to enhance the country's growth in high-tech manufacturing, including the production of automobiles. These factors will boost the automotive lubricants market during the predicted period.

Growth Challenges

COVID-19 Impact

The value chain of the producers of automotive lubricants has been impacted by the limits on material distribution and transportation that several nations have put in place since the coronavirus epidemic in late 2019. These producers had a supply deficit during the first half of 2020 due to trade restrictions in important industrial countries like China, and India. This problem limited business manufacturing capabilities and reduced demand for automobile lubricants.

Additionally, most owners who adopted the work-from-home policy rarely used their automobiles or bicycles, reducing product consumption. The automotive lubricants market is anticipated to recover slowly in the upcoming years due to business continuity strategies implemented by top lubricant providers and supported by government attempts to boost the economy.

Continuous Improvement in Vehicle Technology

By lowering friction and safeguarding the solid moving parts, automotive lubricants considerably lengthen a car's lifespan but as lubricants and technologies advance every day, the pace of automotive lubricants market is drastically reduced. The oil drain intervals in automobiles have increased from every 6–12 months to 18–24 months due to the growing footprint of synthetic lubricants and advantages, including higher fuel efficiency.

Users tend to favour premium lubricants with long oil drain intervals to protect their vehicles. However, this has restricted the market volume growth and is anticipated to produce poor volume growth over the forecast period. Additionally, as electric vehicles do not need engine oil, rising sales of them are anticipated to create a major impediment facing the automotive lubricants market.

Growth Opportunities

Aging Vehicle Fleet

As of 2022, there are estimated 1.446 billion automobiles worldwide. The worldwide automotive lubricants market is being driven by the opportunity for maintenance created by the fleet of aging vehicles. Sales of cars have increased in several nations due to rising per capita income and growing demand for personalized transportation options. In 2021, it was predicted that there would be 55.3 million cars sold worldwide. As a result, OEMs are increasing their production capacity to keep up with the rising regional and international demand.

Overview of Key Segments

Engine Oil Dominant with Excellent Cooling Properties

Engine oil continues to dominate the automotive lubricants market with a major share in the forecast period. In diesel trucks, light-duty trucks, and passenger cars, engine oil is utilized extensively. It promotes consistency, guarantees dependability, and lessens engine wear. It also helps keep the engine clean, corrosion-free, and cool. Automakers have been producing light automobiles with precise tolerances, which makes them more durable, thanks to technological advancements and legally imposed fuel economy standards.

With their abilities to prevent oil leaks and reduce oil consumption, high-mileage engine oils are in demand right now. Of all the automotive segments, the segment for light vehicles uses the most engine oil. High-viscosity engine oils, called heavy-duty motor vehicle engine oils, are utilized in both on- and off-road, heavy vehicle applications. These engine oils are produced to support harsh geographic conditions and stringent emission criteria.

Technology developments pose a threat to the growth of the engine oil segment in terms of volume consumption because of the lengthened engine oil replacement intervals. As a result, in the upcoming years, it is anticipated that the aforementioned variables will substantially impact the automotive lubricants market.

Synthetic Oil to Dominate for Improved Vehicle Performance

Synthetic oil is gaining popularity among industry professionals and end users for a variety of reasons, including improved shear and chemical stability, viscosity index, improved low and high-temperature viscosity performance at service temperature extremes, decreased evaporative loss, higher fuel economy in certain engine designs, better lubrication during severely cold weather starts, and increased horsepower and torque due to less initial drag on the engine.

With the ongoing changes in vehicle design and the introduction of cutting-edge new engines, promising growth possibilities are predicted in the automotive lubricants market. Adopting modern engines and expensive vehicle components is another recent market development for synthetic lubricants. Furthermore, synthetic lubricants are more compatible with these high-end engines and parts. There will thus be enormous demand for them during the projection period.

Growth Opportunities Across Regions

Asia Pacific to Acquire a Major Revenue Share

Asia Pacific dominates global automotive lubricants market due to many on-road vehicles in countries like China, Japan, India, and South Korea. Different automotive lubricants are consumed differently depending on the country and the region. For instance, South Korea's usage of synthetic lubricants is higher than India's, and most of it is used in commercial and passenger cars. In India, the two-wheeler market, which makes up about one-fourth of the entire demand, consumes the second-highest percentage of lubricating oil after commercial vehicles.

China at the Forefront

Government efforts to replace out-of-date vehicles are driving demand for better, higher-performing lubricants. India is also the third-largest lubricant market in the world and the second largest in the region. Despite the economy's modest growth, China is currently the world's largest market for lubricants, and that is projected to continue in the years to come.

The largest manufacturer of automobiles worldwide is China. Around 302 million automobiles were registered in China as of 2021. The number of cars on the road in China has increased during the last ten years nearly 1.9x. As a result, in the upcoming years, it is anticipated that the aforementioned variables will substantially impact the automotive lubricants market.

Europe’s Market Attractiveness on the Rise

Europe currently stands second in global automotive lubricants market in terms of revenue share. Automobile lubricants are in great demand in the area due to growing consumer demand for effective and high-quality lubricants. The revival of the industrial sector, greater emphasis on fuel efficiency and CO₂ reduction, the availability of base oil in the region, and the enhancement of product quality are key market drivers in Europe.

The European Union's numerous environmental, health, and safety restrictions could hinder market expansion. With 41 assembly and engine production facilities, Germany dominates the European automotive industry and produces one-third of all the cars sold on the continent. Equipment makers, suppliers of materials and components, engine manufacturers, and integrators of complete systems have facilities in Germany, one of the top manufacturing hubs for the aircraft industry.

Leading Players in Global Automotive Lubricants Market

A few of the players in the automotive lubricants market include Shell International B.V., Exxon Mobil Corporation, FUCHS PETROLUB SE, Motul, Phillips 66 Company, Repsol S.A., SK lubricants Co., Ltd., China National Petroleum Corporation, Klüber Lubrication München SE & Co. KG, Amsoil Inc., Petróleo Brasileiro S.A., Valvoline, Inc., JXTG Nippon Oil & Energy Corporation, Chevron Corporation, and BP P.L.C. (CASTROL).

Recent Notable Developments

• In March 2020, Royal Dutch Shell PLC announced plans to expand the manufacturing capacity of its lubricant blending plant in Bekasi, Indonesia, to 300 million liters per year by 2022, helping in satisfying the growing domestic lubricant market in the coming years
• In April 2021, Valvoline Inc. launched Valvoline High Mileage 150k with MaxLife Plus Technology Synthetic Blend, an engine oil specifically designed for engines with over 150,000 miles. The revolutionary formula of the product reduces oil consumption in older, high-mileage engines, while its Moly Additive Protection improves engine performance and power
• In January 2022, Chevron Corporation, headquartered in San Ramon, California, announced the establishment of its Keep Clean Preferred Vendor Program, which will give its clients the tools and services required to obtain the majority of their lubricants. Furthermore, participating vendors will assist enterprises with their maintenance and lubrication needs, covering everything from storage and handling to fluid analysis, allowing organizations to increase performance while eliminating costly downtime

Regional Classification of the Global Automotive Lubricants Market is Listed Below:

North America

• U.S.
• Canada

Europe

• Germany
• France
• Spain
• U.K.
• Italy
• Russia
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• Southeast Asia
• Rest of Asia Pacific

 Latin America

• Brazil
• Mexico
• Rest of Latin America

Middle East and Africa

• GCC
• South Africa
• Rest of Middle East & Africa

*Regions and countries are subject to change based on data availability.

Key Elements Included In The Study: Global Automotive Lubricants Market

• Automotive Lubricants Market by Product/Technology/Grade, Application/End-user, and Region
• Executive Summary (Opportunity Analysis and Key Trends)
• Historical Market Size and Estimates, Value and Volume, 2019 - 2022
• Volume Consumption at Regional and Country Level, 2023 - 2030
• Market Dynamics and Economic Overview
• Market Size in Value and Volume, Growth Rates, and Forecast Figures, 2023 - 2030
• Competitive Intelligence with Financials, Key Developments, and Portfolio of Leading Companies 
• Regional and Product/Grade/Application/End-user Price Trends Analysis
• Production Output Analysis (Major Producing Regions)
• Key Trade Statistics (Import and Export)
• Value Chain and Five Force’s Analysis
• Regional/Sub-region/Country Market Size and Trend Analysis
• Company Market Share Analysis and Key Player Profiles

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