The global lubricant additives market size was valued at USD 16,255 million in 2021. It is estimated to reach an expected value of USD 20,915 million by 2030, growing at a CAGR of 3.2% during the forecast period (2022–2030).
Lubricant additives are chemical components or compounds that fulfill one or more functions when added to a fluid in a precise quantity. Base oils are combined with lubricant additives to create complete lubricants. In many car and end-use sectors, lubricant additives are crucial for managing energy and emissions. The worldwide lubricant additives market is driven by the rising demand for lubricant additives in the automotive industry.
Lubricant additive technology provides many benefits to the environment and the end-users. Increasing environmental concerns are a significant parameter taken into consideration during lubricant formulation and use recently by many major players. Regular developments in the engine oil specifications for different motor vehicles are increasing the demand for newer lubricant formulations, consequently increasing the demand for innovative lubricant additives. The requirement to conform to the upcoming PCMO specifications, i.e., GF-6, is forcing automotive manufacturing companies and lubricant formulators to develop engine oils according to these specifications. This is expected to increase the demand for engine oil lubricant additives at a healthy rate in the coming years.
Many Asian countries have formulated stringent emission control regulations in recent times. For instance, India planned to implement the Bharat Stage VI (BS-VI) norms for vehicles by April 2020. However, the implementation of BS-VI is delayed due to the COVID-19 lockdown in the country. The country's emphasis on improving vehicular fuel economy and emission controls creates the need for low-viscosity oils used in heavy-duty vehicles. The efforts to reduce engine oil viscosity are already underway in passenger car motor oils (PCMOs). Hence, the increasing emission regulations for lubricants in the automotive and industrial sectors are expected to drive the market for lubricant additives over the forecast period.
The African region has witnessed higher industrial growth recently, and investment opportunities have increased with government support and policies. Several vehicle manufacturers have expanded production and export from their South African operations based on incentives offered in the government's Automotive Production and Development Plan (APDP). The automotive industry is expected to witness a rebound in Africa, with new production streams facilitated in Algeria and Morocco. For instance, as a part of its expansion plan in Africa, Nissan increased its geographical presence in various countries, including South Africa, Nigeria, Egypt, Kenya, Ghana, and Algeria. This will likely increase the company's capacity to 200,000 vehicles in Africa, which is further expected to aid the demand for lubricants.
The Middle East is another promising region for the lubricants market. The industrial lubricants sector is growing at a favorable rate in the region, owing to factors such as the Dubai Expo 2020 and rapid expansions and investments flowing into the infrastructure sector. The fourth industrial revolution, commonly referred to as 4IR in the Middle East, is likely to hold great potential for the lubricants market in the manufacturing sector during the next few years. This will likely boost the demand for lubricant additives over the forecast period.
The chemistry and technology involved in engine oil production have recently undergone tremendous change. With the introduction of long-lasting, high-performance lubricants, the interval for an oil change is extended by almost 100%. Currently, many passenger cars and mobile hydraulic systems have lifetime gear fluids. The gear oils used for axles in the present-generation passenger cars last more than 300,000 km. Even the oils used in commercial vehicles show longer intervals to reduce maintenance costs.
In addition, the share of service fills to factory or OEM fills of lubricants is expected to change, with 65% of the lubricants likely to be filled at the factories or OEMs by the next ten years. These growing drain intervals, coupled with longer runtimes of industrial equipment and automobile gearboxes, are likely to impact lubricants' volumes. This will hamper the lubricant additives consumption through the forecast period.
Compared to mineral lubricants, synthetic lubricants offer better and improved characteristics, like low traction coefficient, which lowers power consumption, reduced gear wear, increased service life, and decreased flammability, which raises safety, among many others. They are best suited for complex and particular applications that involve extremely high temperatures (such as heavily loaded gearboxes, etc.).
The industrial sector is likewise quickly growing its demand for high-performance lubricants. These lubricants are in higher need due to their minimizing friction and wear, resistance to caustic chemicals, oxygen compatibility, lifespan, and extended lubrication intervals. These lubricants are quickly replacing mineral-based oils and greases. Since they assist in lowering the maintenance and replacement costs of the industries, these lubricants are widely used. This, in turn, will lead to consequent cost-cutting in the sectors.
The global lubricant additives market is segmented by product type, lubricant type, end-user industry, and region.
By product type, the global lubricant additives market includes Dispersants & Emulsifiers, Viscosity Index Improvers, Detergents, Corrosion Inhibitors, Oxidation Inhibitors, Extreme-Pressure Additives, Friction Modifiers, and Others.
The Dispersants & Emulsifiers segment accounts for the largest market share and is estimated to grow at a CAGR of 3.1% during the forecast period. Dispersants are a class of lubricant additives that prevent sludge buildup and other deposits on essential surfaces. A significant portion of their overall consumption is in heavy-duty diesel engine oils and gasoline engine oils, respectively. Dispersants are also used in gear lubricants, aviation field engine oils, natural gas engines, and automatic transmission fluids. Emulsifiers are majorly used in metalworking, rock-drill, and hydraulic applications. They help make the emulsions stable over long periods by offering good lubricating properties, making them fit with system materials and easy to demystify for disposal. Overall using dispersants and emulsifiers in making the lubricants provides excellent emulsifying and stabilizing properties in the product type in which they are used, which drives the segment growth.
By lubricant type, the global lubricant additives market includes Engine Oil, Transmission & Hydraulic Fluid, Metalworking Fluid, General Industrial Oil, Gear Oil, Grease, Process Oil, and Others.
The Engine Oil segment accounts for the largest market share and is estimated to grow at a CAGR of 3.2 % during the forecast period. Engine oils are frequently used for lubricating internal combustion engines in many types of automobiles. The average age of vehicles has been increasing at a constant rate over the years. This factor provides an opportunity in terms of the refill market. The increasing average age of passenger cars and the growing urban population in developing countries are the factors expected to drive the consumption of engine oils which in turn is expected to drive the market demand for lubricant additives used in engine oil.
By end-user, the global lubricant additives market includes Automotive & Other Transportation, Power Generation, Heavy Equipment, Metallurgy & Metal Working, Food & Beverage, and Others.
Automotive & Other Transportation accounts for the largest market share and is estimated to grow at a CAGR of 3.3% during the forecast period. Different additives like anti-corrosion additives, dispersants, emulsifiers, and many other additives enhance the lubricant property. These vehicles make substantial use of medium-duty and high-performance lubricants due to the heavy loads, and fast rubbing those gears, transmission systems, and engines must withstand. The components so generate much heat. The need for lubricant additives is increasing due to the widespread usage of lubricants to prevent friction-related gear tooth breakage and ensure smooth and efficient operation.
By region, the global lubricant additives market is segmented into North America, Europe, Asia-Pacific, and SAMEA.
Asia-Pacific accounts for the largest market share and is estimated to grow at a CAGR of 3.6% over the forecast period. The food processing sector in Asia-Pacific is expanding at a moderate rate. It is likely driven by the rising popularity of processed and packaged frozen foods, particularly dairy, baby food, and confectionery. It may also be driven by processed fruits, meats, specialty grains, and legumes. The beverage industry has raised the consumption of wholesome, organic, ready-to-drink smoothies, juices, and yogurts. Consequently, the food and beverage industry has been providing chances for investment, which is anticipated to spur demand for new machinery utilized in such facilities and open up new market opportunities. For example, Nestle invested in several projects in May 2020 to expand its presence and broaden its product offerings nationwide.
North America is estimated to account for USD 3,630 million by 2030, registering a CAGR of 2.4% during the forecast period. The automotive industry is one of the most prominent application areas for lubricant additives. In the automotive sector, lubricant additives find various applications, including flexible printed circuits and boards, carrier and transport belts, sensors, lithium-ion batteries, HVAC systems, internal combustion engines, generators, motors, etc. The United States is one of the significant countries generating electricity globally. According to US Energy Information Administration, in 2019, about 4,127 billion kilowatt-hours (kWh) of electricity were generated at utility-scale electricity generation facilities in the United States. About 63% of this electricity generation was from fossil fuels—coal, natural gas, petroleum, and other gases. About 20% was from nuclear energy, and about 18% was from renewable energy sources. Such increasing electric generation is expected to drive the market.
Europe is the third-largest region. With the increasing levels of health awareness and rapidly aging population, the demand for healthy and ready-to-eat food products has been increasing in the region. The need for bakery products is also growing. Lubricants are used in the food and beverage industry to prevent food from being contaminated by producing specialty adhesives. They are also used in the machines that operate within the industry. Therefore, with the growth of the food and beverage industry, the demand for lubricants used in the industry is expected to increase during the forecast period.
Apart from these, in Germany, bio-lubricants are increasingly being used in metalworking, automotive manufacturing, and general manufacturing sectors in response to regulatory requirements, coupled with superior performance, improved energy efficiency, and prolonged lifecycle of the lubricants and machines. As a quickly evolving market, the bio-lubricants sector has been identified as one of the fields with the highest growth potential within the broader market for finished lubricants. With the growing demand from end-user industries, the need for lubricant additives is expected to grow during the forecast period.
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