Lubricant Additives Market Expected to Reach $31.3 Billion by 2030

According to a new report published by Allied Market Research titled, “Lubricant Additives Market by Type and Application: Global Opportunity Analysis and Industry Forecast, 2021–2030” The lubricant additives market size was valued at $18.3 billion in 2020, and is projected to reach $31.3 billion by 2030, growing at a CAGR of 3.7% from 2021 to 2030.

Lubricant additives are a type of inorganic or organic chemical substance that is suspended in functional fluids, to increase their overall performance. To achieve the desired grade of industrial lubricants, lubricant additives are developed or used individually. Lubricant additives primarily increase the overall qualities of the lubricant, such as lower viscosity levels, corrosion resistance and friction resistance. Lubricant additives boost overall machinery and automobile output productivity in terms of operational efficiency, fuel consumption and delivery time. Lubricant additives are widely used in the automotive industry, particularly in heavy commercial and passenger vehicles.

The increase in sales of passenger cars and commercial vehicles drive the lubricating oil additives market in the automotive industry. Lubricating oil additives are majorly used in transmission fluid, hydraulic fluid, engine oil, and gear oil to prevent adhesive wear and protect metal components. In 2021, the global car sales increased to roughly 66.7 million vehicles, up from around 63.8 million in 2020, and nearly 6.5 million new passenger plug-in electric vehicles were registered globally. This is up from the 3.1 million units sold in 2020 by 108%. In addition, over the last five years, the pace of motorization in Asia-Pacific has been steadily increasing. South Korea, China, Japan, India, and Indonesia are among the major contributors to the region's growth. India's yearly vehicle production reached $2.3 million in the first half of 2021, up from $1.2 million in the first half of 2020, according to the International Organization of Motor Vehicle Manufacturers. By the end of 2021, India is predicted to be the world's third-largest passenger vehicle market. According to Trading Economics, car sales in China grew 12.8% year over year in September 2020, hitting 2.5 million. Thus, rise in demand for motor vehicles across the globe is expected to drive the demand for lubricant additives.

However, fluctuating crude oil prices and rise in competition from the unorganized and fragmented market hinders the lubricant additives market, while increase in demand for lubricant additives from developing countries, such as Brazil, China, India and South Africa will provide lucrative opportunity for the market.

On the basis of type, the dispersant segment is estimated to witness the highest CAGR for the forecast period. Dispersants help to keep insoluble pollutants suspended in the oil, preventing sludge formation. Dispersants are widely used to prevent the accumulation of sludge, varnish, or other deposits on surfaces. Three-quarters of their use is in diesel and gasoline engine oils, where their use is limited to engine protection. The dispersion is one of the necessary additives for both automotive and industrial additive packages.

On the basis of application, the automotive segment dominated the lubricant additives market. In an automobile, lubricant additives are used to clean, cool, and protect metal parts against rust and corrosion. Engine oil is used in automobiles to improve fuel performance and efficiency, and gear oil is used in automobile gearboxes to protect gear parts from intense mechanical pressure. As a result of the rapid development of the automotive sector and the increase in vehicle production in major regions, demand for gear and engine oil will rise, as it has a wide range of applications in the automotive sector.

On the basis of region, the lubricant additives market is analyzed across four major regions, which include North America, Europe, Asia-Pacific, and LAMEA. Asia-Pacific accounted for the dominant lubricant additives market share in 2020, and is anticipated to maintain its dominance during the forecast period. It is due to factors such as rising economies and an increase in investments in various industrial sectors. According to China Electronic Information Industry Development, between 2020 and 2025, the country is estimated to spend $1.4 trillion on new infrastructure projects, including renewable energy and residential structures. As a result of the rapid development of the construction and car sectors in China and India, as well as the vehicle sectors in Japan and Korea, there has been a growth in demand for improved lubrication in these industries throughout the Asia-Pacific region. The lubricant additives market share is analyzed across all significant regions and countries.

The key players operating in the lubricant additives market are BASF SE, Evonik Industries AG, Infineum International Limited, Chevron Oronite Company LLC, Chemtura Corporation, The Lubrizol Corporation, Croda International PLC, Afton Chemical Corporation, Vanderbilt Chemicals LLC, and Rhein Chemie Corporation

Other players operating in the lubricant additives market are Laxness Corporation, Dover Chemical Corporation, and Wuxi South Petroleum Additives.

COVID-19 Impact on the Market

• The COVID-19 pandemic negatively impacted the lubricant additives market on a global level, as the productivity of various manufacturing sectors, such as metalworking, chemicals, fabricating oil & gas, consumer goods, and others decreased as a result of restrictions and lockdown imposed by governments globally.
• However, the automobile industry was particularly hard hit, with a huge portion of the industry and its many suppliers around the world closing down.
• As a result, car utilization as well as vehicle sales have decreased. Because lubricant additives are primarily utilized in passenger-vehicle and heavy-duty and lubricants, the demand for lubricant additives, particularly in the passenger-vehicle lubricant segment, has decreased as vehicle manufacturing has decreased.
• In addition, As per the International Organization of Motor Vehicle Manufacturing, in 2020 vehicle production fell by 16 % globally, to less than 78 million vehicles, with all major producing regions, such as the Brazil, The U.S, and Germany, experiencing dramatic drops of 11% to 44%, with Europe seeing a reduction of 21% on average.

KEY FINDINGS OF THE STUDY

• The lubricant additives market size is provided in terms of $million and kilotons.
• By type, the dispersant segment emerged as the global leader by acquiring around 29.0% market share in 2020 in terms of revenue, and is anticipated to be the largest market during the forecast period.
• On the basis of application, the automotive segment emerged as the global leader, registering 68.6% market share in 2020 in terms of revenue, and is anticipated to continue its dominance during the forecast period.
• Region wise, Asia-Pacific is the major consumer of Lubricant additives among other regions. It accounted for around 35.4% of the global market share in 2020 as a result of rapid growth in the automotive and industrial sector across the region.