emerging opportunities for chemicals and materials in transportation
TRANSCRIPT
Emerging Opportunities for Chemicals and Emerging Opportunities for Chemicals and Materials in TransportationMaterials in Transportation
Mega Trends to Trigger New Product DevelopmentMega Trends to Trigger New Product Development
Analyst BriefingAnalyst Briefing
2626thth March 2014March 2014
Today's Presenters
Soundarya Shankar
Research Analyst
Frost & Sullivan
K. Deepan Kannan
Industry Manager
Frost & Sullivan
2
• Chemicals & Materials
• Company expert on lightweight materials, paints and coatings
• Recent experience in researching lubricants
• Chemicals and Materials in Transportation
• 7 years' research experience at Frost & Sullivan
Our Chemicals Market ApproachFocus on end-markets and mega trends
Functionality and performance
Health and wellness
Food Drugs &
Cosmetics
Each Mega Trend affects the use of chemicals in Transportation differently
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Globalisation Low carbon economy
Construction
& UtilitiesTransportation
Source: Frost & Sullivan analysis
IntroductionMega Trends Impact a Range of Chemical Markets in Transportation
Lightweight Materials
Engineering Plastics and High Temperature Plastics
Biofuels and Lubricants
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Advanced Coatings & Adhesives
Tires
Fibres and Automotive Textiles
High Speed Rail, Marine, Aerospace
Source: Frost & Sullivan analysis
Chemicals and Materials in Transportation
Automotive applications are the largest transportation sector for chemical companies.
• For many individual product groups, automotive applications represent 50 to 75% of total usage across all transportation applications.
o Other transportation applications include heavy commercial vehicle, bus, rail, aerospace and marine.
Aerospace � The global automotive industry represented a
market of approximately $70 billion for chemicals
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Chemicals and
Materials in
Transportation
Automotive
Heavy
Commercial
Vehicles
Bus and
Rail
Marine
market of approximately $70 billion for chemicals
& materials companies in 2013.
� Within automotive applications, many products
are further subdivided into use by original
equipment manufacturers (OEMs) and in the
aftermarket.
Source: Frost & Sullivan analysis
Chemicals and Materials Used in Transportation
FeedstockLubricants and Fuels
Polymers
Additives
Fibres and Reinforcements
Functionality and performance
Health and wellnessChemicals and Materials in
Transportation
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Thermoplastics and Thermosets Paints and
Coatings
Adhesives and
Sealants
Textiles
Tire Materials and Chemicals
Composites
Elastomers and Rubbers
Globalisation Low carbon economySource: Frost & Sullivan analysis
Globalisation Trends in Automotive
Development of road infrastructure
Changes in the world at large
Increasing urbanisation will change the types of vehicles needed.
Chemicals and Materials in the Automotive Market: Summary of Individual Globalisation Trends
Social Globalisation Factors
Globalisation within the Automotive Industry
Supply chain
Vehicle design and engineering
OEMs increasingly have design centres in multiple regions around the world.
Globalisation
7
Changes in buyer demographics
Middle classes in developing economies are growing.
Development of road infrastructure
Better road infrastructure will increase vehicle demand.
Changes in buyers’ desires
Despite the global standardisation of design, consumers still want more personalised vehicles.
Manufacturing
Despite the globalisation of car assembly, local factors still matter.
Supply chain
Vehicle industry supply chain and platform strategy are increasingly globalised.
Aftermarket
Globalisation of standards prompt changes to aftermarket product
requirements.Source: Frost & Sullivan analysis
Impact of Globalisation Trends on the Chemical Industry
Overall Level of Impact
Urbanisation
Supply chainManufacturing
Aftermarket
Rele
van
ce o
f C
hem
icals
Chemicals & Materials in Transportation: Criticality and Relevance of Globalisation Trends, Global, 2012–2020
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Note: External global factors are shown as blue points.
Globalisation trends within the automotive industry are shown as green points.
Source: Frost & Sullivan analysis
InfrastructureDemographics
Personalisation
Design
Rele
van
ce o
f C
hem
icals
Rate of Globalisation
Health & Wellness Trends in Automotive
Impact of health and wellness as a megatrend can be seen as a function of increased safety, comfort and health features in passenger cars
HealthSafety Comfort
Wet Grip and Low Rolling Resistance Tires
All weather grip tyres design is gaining
NVH Materials
Growing demand for NVH materials create opportunities for hot melt
Low Emission Materials and Coatings
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All weather grip tyres design is gaining interest. Focus will be on to develop tires with a balance of wet grip, ice/snow traction and rolling resistance values.
This will create opportunities for innovative rubber formulations and tread design.Flexible Design and Smart Airbags
Textile materials to enable longer inflation of airbags for enhanced protection during rollovers of the vehicles in the event of accidents.
New textiles and coating materials for easier design and assembly of airbags.
Smart airbags that avoid collision altogether is a likely development in passenger safety.
create opportunities for hot melt adhesives.
Hot melt adhesives are also preferred as a replacement for solvent-based ones to eliminate any residual odor.
Developing PU foams in seating applications that contribute to noise and vibration reduction.
Automotive Glazing
The trend towards larger glazing areas has created opportunities for specialty coatings and films, that give protection from infrared and ultra-violet radiation.
Low emission plastics to be used in interior applications.
Trend towards waterborne coatings from solvent borne to improve the interior air quality of the vehicle.
Focus on allergen-free materials such as Acella® Eco Green from Benecke-Kaliko, used in interior applications.
Source: Frost & Sullivan analysis
Functionality & Performance Trends in Automotive
Focus on functionality and performance of the automotive vehicles by OEMs has given rise to opportunities for chemical companies
Improved Performance
and Reduced
Maintenance
• Increased opportunities for high performance lubricants.• Improved performance characteristics such as durability, thermal,
corrosion and chemical resistance have led to the increased the penetration of powder coatings.
• Powder coatings also aid in reducing the number of coating layers.
Advanced Engine Technologies
Durability Requirements
Parts consolidation • High performance materials enable OEMs and component
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Greater design
flexibility
Parts consolidation
Easy processability
• High performance materials enable OEMs and component manufacturers by offering improved flexibility and design freedom.
• Radiation-cured coatings, quick drying systems and coatings that reduce throughput for the body shops will gain focus.
Specialty Appearanc
e Care
Extended vehicle life
Innovative car care solutions
• Innovative products such as self healing coatings and scratch resistant films.
• Advancements in refinish coatings will require reformulation of car care chemicals to keep pace with the developments.
Greater Design
Flexibility
Specialty Appearance
Care
Source: Frost & Sullivan analysis
• Choice of plastics and composites over metals has proven to offer
50.0% weight reduction along with a 25.0-30.0% savings in fuel
consumption. Furthermore, 1Kg weight reduction aids in
reducing CO2 emissions by 20 Kg.
• Plastic and composite manufacturers are working
closely with automotive OEMs and component
manufacturers to develop lightweight solutions in
the marketplace.
• Rapid substitution of metal by plastics have steered
the use of adhesive and sealants in the
automotive industry.
Low Carbon Economy Trends in Automotive
• The European parliament and Council Directive 2000/53/EC has
taken initiatives to collect, store, treat, reuse and
recycle end of life vehicles.
• The directive mandates its member
states to achieve a recovery and
recycling target of 95% by 1st January
2015. It further places limits on the
amount of heavy metals/other
hazardous substances in the ELV
Light Weighting Materials
Material Recycling Trend
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automotive industry.
• The European commission as well
as the US ozone commission
model has set limits for VOC
emissions from automotive
refinish coatings. Water-borne and
high solids solvent borne coatings
are therefore poised to witness
strong growth.
• In the automotive OEM coatings market,
powder coatings are gaining momentum
due to superior environmental profile.
• Automotive OEMs are relentlessly
focussing on increasing the use of bio
plastics to enhance the environmental
footprint of the vehicle. Furthermore,
regulatory bodies are striving to accelerate
the share of recycled plastics.
• Bio-based and biodegradable lubricants are becoming
increasingly important in applications such as wheel
bearings, chassis, steering linkages, where lubricants
come in direct contact with the environment.
Use of Bio-based Materials
Sustainable Coating Technologies
Source: Frost & Sullivan analysis
Why Light weighting?
Vehicle Weight Reduction Trend in the Automotive Industry
1500
2000
1850 kg1810 kg
(0.79) %CAGR
1730
Av
era
ge V
eh
icle
Weig
ht
(kg
)
10.0% reduction in vehicle weight offer 3-4% fuel
savings
This equates to 0.46 l of
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1000
1500
2002 2004 2006 2008 2010 2012
USA EUROPE
1282 kg 1250 kg
(0.68%)CAGR
1200A
vera
ge V
eh
icle
Weig
ht
(kg
)
Year
Increase in small car demand to drive down average vehicle
weight, with a reduction of 8 to 15 kg year on year in the
United States and Europe
This equates to 0.46 l of gasoline saved per 100 km driven for each 100 Kg of
mass reduced
This offers savings in CO2emissions of 25.3 Kg for each kilogram of weight
reduced over the life of the vehicle
Source: Frost & Sullivan analysis
Evolution of Weight Reduction by OEMs
Vehicle Weight Reduction Versus CO2 Emission (Europe), 2010 and 2017
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Automotive Plastics Market: Plastic and Composite
Content per Vehicle (World), 2007-2017
Automotive Plastics Market: Plastic and Composite
Content as Percent of Vehicle Weight (World), 2007-2017
106.8 109.4 111.9 114.7 118.0 121.2 124.5 127.8 131.1 134.5 137.5
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Plastics Q
uantity
per Vehicle
(Kg)
7.4%
7.7%
8.0%
8.1%
8.2%
8.4%
8.7%
8.9%
9.1%
9.4%
9.6%
6.0%
6.5%
7.0%
7.5%
8.0%
8.5%
9.0%
9.5%
10.0%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Pla
stics Q
uantity a
s
Percent o
f V
ehicle
Weig
ht (%
)
Source: Frost & Sullivan analysis
Dynamics in Automotive Light weighting
4.0
5.0
6.0
7.0
PP
PC
PU
ABSBlends
CA
GR
(%
)
Metal
Two or more plastics
competing for the same
application
Substitution of
Total Automotive Plastics Market: Growth Opportunity Matrix, Europe, 2009–2019
Substitution Trends in Automotive Applications
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0.0
1.0
2.0
3.0
4.0
0.0 500.0 1,000.0 1,500.0 2,000.0 2,500.0 3,000.0
Other Compounds
PA
HPP
Note: Bubble size indicates the growth of the segment.
Revenue (€ Million)
Un
it S
hip
me
nt
CA
GR
(%
)
Materials in
Automotive
Applications
replacement by plastics and composites
Substitution of plastics by composites
Source: Frost & Sullivan analysis
Material Recycling in Automotive
Plastic Recycling
At the end of vehicle life, automotive components are dismantled for
recycling and are used to manufacture new automotive components.
Plastics used in consumables such as plastic bottles are also used
to develop automotive components.
Recycling plastics not only contribute to CO2 emission reduction but
also aid in preventing the ejection of sensitive substances such as
lead, mercury and oil into the environment.
Catalyst Recycling/Regeneration
Catalysts used in emission control catalyst technologies are
poisoned and recycling them offer significant cost savings, especially
because precious metals are used in these applications
Several patented state of art technologies have been developed to
recycle and reuse catalysts used in catalytic converters.
With Approximately 12.6 million vehicles recycled each year, GHG emission are reduced up to 30 million metric
tons every year.
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lead, mercury and oil into the environment.
Automotive Fluids Recycling
Automotive fluids present significant opportunities
for recycling. According to the automotive recyclers association,
current level of fluid recycling is as follows
100.8 million gallons of gasoline and diesel fuel
24 million gallons of motor oil
8 million gallons of engine coolant
4.5 million gallons of windshield washer fluid.
Other Material Recycling
Federal Government has made initiatives to recover lead from used
batteries and 95% of battery cases are recycled.
New tires are manufactured using 10% of recycled rubber material
while rubber from used tires are also used for brake pedals and floor
mats.
Recycling
Trends
Source: Frost & Sullivan analysis
Conclusion
Functionality and Performance
Health and Wellness
Chemical companies need to focus on the convergence between mega trends for the development of new products
Countries such as China are the highest-growth markets for luxury car brands, such as Ferrari and Land Rover.
Focus on powder coatings address both the durability requirements and also contributes to
sustainability
Countries such as China
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Source: Frost & Sullivan analysis
Low-carbon Economy
Globalisation
Waterborne coatings addresses health as well as reducing the impact of chemicals on environment
Rover.
Waterborne coatings addresses health as well as reducing the impact of chemicals on environment
Need for low carbon economy is a global trend, which is boosting interest in lightweight design
from Asia
Countries such as China are the highest-growth markets for luxury car
brands, such as Ferrari and Land Rover.
Research Studies
Recently Published
Light-weighting Role of Performance Plastics in the European Automotive Market
Strategic Analysis of the Global Lubricant Market and the Impact of Bio-based Feedstock
Global Markets for Adhesives and Coatings in High-speed Rail
Global Analysis of the Automotive Refinish Coatings Market
Upcoming
Global Markets for Biofuels
Analysis of the European Fuel Additives Market
Global Automotive Adhesives and Sealants Markets
Strategic analysis of the Global Fibers Market for the Automotive Sector
Strategic Analysis of the Global Tires Market
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Market
Analysis of the Global Advanced Aerospace Coatings Market
Analysis of the North American and Western European High Heat Thermoplastics Market
Global Opportunities for Plastics and Composites in High Speed Rail
Strategic Analysis of the Global Tires Market
APAC Automotive Coatings Outlook
Global Automotive Adhesives and Sealants Markets
Global Lubricant Additives Market
Strategic Analysis of the Global LED Materials Market
Automotive Paints and Coatings in Brazil and Mexico
The Global Elastomers Market
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For Additional Information
Deepan Kannan
Global Program Manager
Chemicals in Transportation
(91) 44-66814070
Soundarya Shankar
Research Analyst
Chemicals & Materials
(91) 44-66814068
21
Bernard Weber
Sales Director, Europe
Chemicals, Materials & Food
(44) 20 7343 8352
Mark Hicks
Sales Director, N America
Chemicals, Materials & Food
(1) 210 247 2490