Automotive Plastics Market

Automotive Plastics Market Outlook

The Automotive Plastics Market is valued at USD 46.7 Bn in 2026 and is projected to reach USD 77.5 Bn,  growing at a CAGR of 8% by 2033

Market Analysis in Brief

In the past few years, owing to the stringent emission regulations and focus on safety standards in the automotive industry, the role of plastic in the production and design of cars has increased. These legislative needs together with buyers demanding fuel-efficient cars have led carmakers to put emphasis on lightweight materials. An estimated 10% car weight reduction will reduce fuel usage by around 7%-8%. Rising car sales, increasing demand for lightweight materials, and a boom in vehicle electrification are poised to offer ample growth opportunities in the automotive plastics market over the coming decade.
Key Report Findings

• In 2020, interior applications remained the largest market and accounted for more than 40% of the total automotive plastics market in terms of volume
• Polypropylene (PP), polyurethane (PU), polyamide (PA), and polyvinyl chloride (PVC) accounted for more than 65% of the automotive plastics industry in 2020
• In 2020, Asia Pacific held around 50% of the automotive plastics market

Growth Drivers

Stringent Emission Regulations, and Growing Vehicle Electrification

The average car consists of more than 30,000 parts, including the smallest of screws, nuts, and bolts. These parts are produced with a variety of raw materials and manufacturing processes. Today, more than 30% of these components are made up of plastics. Plastics have revolutionized the automotive industry in terms of performance, build, safety, and functionality. The automotive plastics market is the third-largest outlet for plastics after packaging and construction. The automotive industry is expected to grow by 5% and sales are likely to cross the mark of 100 million units in the next 5 years.

Overview of Key Segments

Polypropylene and Polyurethane to Lead

In total, the automotive industry deploys more than 39 types of plastic materials including commodity and engineered plastics. Polypropylene (PP), polyurethane (PU), polyamide (PA), and polyvinyl chloride (PVC) accounted for more than 65% of the automotive plastics market in 2020, with PP being the clear leader with a share of 33% in terms of volume. These materials are used in a range of applications including interior, exterior, under the hood, and lighting. These materials aid automakers to make vehicles lighter and fuel efficient, thus lowering GHG emissions. There has been a rise in adoption levels for new energy vehicles (NEVs) such as battery electric vehicles and electrification of vehicle fleets including light, medium and heavy-duty vehicles. These factors will offer abundant growth prospects for polypropylene, polycarbonate, polyurethane, and polyamides.

Polycarbonates Fastest Growing

With the technological changes in autonomous vehicles and the e-mobility landscape, polycarbonate will be the top gainer in EVs. There will surge in huge demand for polycarbonate from electrification and lighting components. Polycarbonate meets the demand for electric vehicle battery thermal management and integration of LiDAR sensors in the structure. In volume terms, polycarbonate is expected to exhibit the fastest growth in the automotive plastics market with a CAGR of 8.6% between 2022 and 2026.

Interior Parts to Remain the Largest Application Segment

Plastics are used in numerous applications in vehicles for instance interior trims, upholstery, under the hood components, exterior parts, fuel system, dashboard, bumper, instrumental panels, and lighting. In 2020, interior applications remained the largest market and accounted for more than 40% of the total automotive plastics market in volume terms. Interior trims, instrument cluster, lighting, seat leather upholstery, door panels and consoles deploy a wide range of plastics such as PP, PU, PVC, PA, and ABS. These plastics allow interior design flexibility, cost-competitive manufacturing, and reduced noise, vibration, and harshness (NVH). Furthermore, these plastic materials also meet the requirements of safety, ergonomics, and aesthetic appearance of vehicles.

Under the Hood to Display Fastest Growth    

Under the hood applications segment is projected to exhibit the fastest growth in automotive plastics market. With under the hood conditions turning out to be more challenging, carmakers are increasingly relying on high-temp plastics such as polyamides, polycarbonates, and ABS. There is a shift towards turbocharged engines as they are more eco-friendly and more efficient. With stringent emissions standards, major OEMs are turning their focus towards turbochargers to provide cleaner transportation. The growth in turbocharger engines growth augurs well with the rise in demand for high-temp plastics.  The demand for plastics in also expected to rise from exterior components due to their properties to create complex shapes, bringing high aesthetic value and smooth finishing to the vehicles.

Growth Opportunities Across Regions

Asia Pacific Accounts for the Largest Share

Asia Pacific by far continues to be the largest automobile producing region. In 2020, Asia Pacific held around 50% of the automotive plastics market. Major manufacturing hubs include China, Japan, South Korea, India, and Southeast Asia. Although, the plastic consumption per vehicle is low in the region as compared to Europe and North America, with automotive production shifting towards premium vehicles, the amount of plastic consumption is projected to rise.

OEMs in these countries are focusing on fuel-efficient and lightweight vehicles due to change in consumer preferences and stringent emissions standards. Plastics have become an excellent alternative to the traditional materials such as steel and cast iron, thus the demand for automotive plastics is anticipated to grow in the region over the coming years.

Europe Emerges Lucrative Post-pandemic

The demand for automotive plastics in Europe, and North America is expected to grow owing to the large adoption of turbocharged engines, and vehicle electrification. Governments in these regions have stringent norms of CO₂ emissions, thus accelerating subsidies on EVs and bans on diesel vehicles. Despite, the EV sales growth in Europe has been exponential post-COVID-19, which is likely to drive the demand for lightweight materials including plastics.

Competition Analysis – Automotive Plastics Market Space

Companies operating in the automotive plastics market have strong global as well as domestic presence. The competition is intense with maximum focus on new product innovation, sustainable products, and developing high-temp plastic blends to reduce environmental impact. Growing demand for high-temp resistant plastics, especially in high-growth application such as under the hood has promoted noteworthy innovations in the sector. Furthermore, companies are also incorporating recycled plastics products in their portfolio.

Key Players

SABIC (Saudi Arabia), Borealis AG (Austria), BASF SE (Germany), Evonik Industries AG (Germany), Solvay (Belgium), LG Chem (South Korea), LyondellBasell Industries Holdings BV (Netherlands), DuPont (US), Arkema SA (France), Covestro AG (Germany)

Recent Notable Developments

• In 2021, Borealis announced the availability of Borcycle™, its polyolefin-based solution composed of both virgin and post-consumer recyclate (PCR) for the North American automotive market. These products can be deployed in the interior, exterior as well as under the hood applications
• In 2019, SABIC launched XENOY™ HTX resin, a new polyester-based resin technology enabling the production of impact and heat resistant and high-performance structural parts and under the hood components

The Global Automotive Plastics Market is Segmented as Below:

By Product Coverage

• Polypropylene (PP)
• Polyurethane (PU)
• Polyamide (PA)
• Polyvinylchloride (PVC)
• High Density Polyethylene (HDPE)
• Acrylonitrile Butadiene Styrene (ABS)
• Polycarbonate (PC)
• (Including PBT, PMMA, PET, LDPE, etc.)

By Application Coverage

• Interior
• Exterior
• Electronics and Light
• Under the Hood
• (Chassis, Powertrain Components, etc.)

By Geographical Coverage

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • France
  • UK
  • Spain
  • Turkey
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • South Korea
  • India
  • Southeast Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • Iran
  • Rest of Middle East & Africa

Leading Companies

• LyondellBasell Industries N.V.
• BASF SE
• SABIC
• Covestro AG
• Borealis AG
• LG Chem
• LANXESS AG
• Celanese Corporation
• INEOS
• Asahi Kasei Corporation
• Koninklijke DSM N.V.