ABOUT THE GLOBAL AUTOMOTIVE MARKET
Below is a Turkish translation of an article published in the January-February 2020 issue of CompositesWorld magazine.
GLOBAL AUTOMOTIVE MARKET
Globally, approximately 5 billion pounds (approximately 2.3 million tons) of composite materials are consumed annually in the light vehicle category (vehicles with a gross vehicle weight under 8,500 pounds). Thermoplastic matrix composites make up the majority of this volume. Composites and other lightweight materials have benefited significantly from recent strong growth, but the automotive sector is expected to face headwinds in the coming year. The expectation of a relatively flat global market in the light vehicle category and the loosening of fuel economy standards in the US will be the main factors delaying growth. However, growth opportunities will also exist as OEMs continue to reduce vehicle weight on their global vehicle platforms.
Automotive material suppliers will need to gain market share to achieve growth in 2020, as year-over-year production growth figures are expected to decline. A flat trend is anticipated in Europe, and a slight decrease is expected in the North American Free Trade Area (NAFTA). In China, single-digit growth figures are expected, a very modest decline compared to the extraordinary annual growth observed recently. With the global manufacturing outlook projected to be between %2 and %3 annually until 2025, composite suppliers will need to gain market share on established materials to achieve meaningful growth.
In addition to the general market slowdown, the loosening of corporate average fuel economy standards in the US will affect the growth of composites in the automotive sector. Weight reduction has become a key strategy for OEMs to meet continuously increasing fuel economy and carbon dioxide emission regulations. These regulations have been a major driving force behind the increasing adoption of lightweight materials in automobiles over the past decade.
With the U.S. proposing to keep fuel economy regulations unchanged until 2026, OEMs are expected to offer less incentive to invest in weight-saving materials like composites. This is especially true for pickup trucks and large sport utility vehicles (SUVs) sold in the U.S. Suppliers of composites and other lightweight materials are expected to see less interest in U.S.-specific platforms given the current regulatory environment.
Globally, the rollbacks in fuel economy standards in the US represent only a minor hurdle in the adoption of lightweight materials in automobiles. Stricter regulations on carbon dioxide emissions outside the US will continue to drive the need for reduced vehicle weight across global vehicle platforms. Weight reduction is also critical for expanding the reach of battery-electric vehicles, and lightweight materials will continue to be pursued for this small but growing segment. Despite the “pause” in US fuel economy regulations, interest in composites for vehicle weight reduction will persist.
To capitalize on this interest, composite component suppliers will have to sharpen their value propositions compared to alternative offerings. High-strength steel and aluminum have benefited most from OEM weight reduction efforts in North America over the last decade, with gains in vehicle mass of %6 and %3 respectively. This share has primarily come from mild steel, the basic automotive-grade steel in terms of cost, manufacturability, and strength-to-weight ratio.
When the data are normalized and differences in specific gravity are taken into account, it shows that the volume of high-strength steel and aluminum has grown roughly 2 and 3 times, respectively, compared to plastics and composite resins during this period. Clearly, there is still much work to be done before composites become the mainstream preferred option in weight reduction efforts in the automotive industry.
The near future presents both challenges and opportunities for composites in automotive applications. Headwinds such as a relatively flat global production outlook and a rollback in regulatory factors regarding lightweight materials in North America will be seen as obstacles to growth. Demand for lightweight automotive materials will continue, and composite material suppliers that can offer cost-effective performance against aluminum and other alternatives can position themselves to win new applications in this challenging environment.
