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The global automotive lubricants market size was USD 70.25 billion in 2018 and is projected to reach USD 79.91 billion by 2026, exhibiting a CAGR of 1.58% during the forecast period.
Automotive Lubricants have a crucial role in the efficient operating and protection of a vehicle. Various automotive lubricants with varied source or base oil are available in the market amongst which mineral-based lubricants account for the lion’s share. However, the adoption and popularity of synthetic lubricants are rapidly increasing and revolutionizing the market. Innovation in lubricant technology has benefitted consumers in many aspects which include, extended oil drain and service intervals, better fuel efficiency, and more extended protection period.
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Synthetic lubricants are the new market trend driving the overall market demand
Synthetic lubricants are nothing but mineral oils that have undergone extensive treatments to improve their performance characteristics and meet the demand of modern automobile technologies. Synthetic automotive lubricants were once considered to be premium products and had limited adoption. But, as the environmental concerns and engine technologies are evolving, the usage of synthetic lubricants is taking up pace.
Today, synthetic and semi-synthetic lubricants account for a healthy share in the market as compared to their shares a decade ago. Synthetic lubricants offer longer oil drain intervals (ODIs) than their counterpart mineral lubricants, which the consumer demand for hassle-free services. Moreover, other benefits of synthetic lubricants include improved fuel efficiency, enhanced hardware compatibility, and lower vehicle emissions. These factors together are boosting the adoption of synthetic lubricants in the automotive lubricants industry.
High-Performance requirements in the Vehicles is driving the market demand
Automotive lubricants play a pivotal role in ensuring the proper and enhanced performance of consumer and industrial vehicles in diversified and extreme environmental conditions. For instance, tractor engine oils not only protect and ensures high performance of tractor in severe climate and field conditions but also facilitates better hardware compatibility of unwavering toughness and quality. These are formulated to support the proper functioning of a vehicle engine and system over-temperature ranging from -40 0C to above 250 0C. Further, these lubricants are also required to cope up with extreme pressures between 105 to 109 Pascal in the engine along with fuel contaminants such as soot and metal particles.
Extended lifetime and protection of the automotive systems are leading the automotive lubricants market demand
Keeping a vehicle on the road is one of the top priorities of the vehicle owners. This is where lubricants come into the picture. The automotive lubricants protect against wear & tear of various automotive components and systems of the vehicle by significantly reducing the friction between the parts and extend their life period. Further, as smaller and complex automotive systems are increasing their presence in the industry, the necessity of low viscosity and better-performing lubricants is continuously increasing. This is expected to support the innovation and development of high-quality lubricants in the upcoming years.
Moreover, OEMs and lawmakers are focusing on universal standardization of lubricant grades, and this is anticipated to provide impetus to the development of high-quality lubricants, particularly synthetic lubricants. The lubricant has to meet the performance level required for specific applications and those set by the competent authorities. For instance, some of the grades of diesel engine oil have to meet the standards such as API CI-4, SAE 15W-40, JASO DH-1, CH-4/SL, ACEA E7-08, SJ, Mack EO-M+, and numerous others. These lubricants also increase fuel efficiency and in turn reduce the green-house gas emission in a vehicle.
Innovation in vehicle Technologies is Dwindling the market
Automotive lubricants significantly boost the life span of a vehicle by reducing the friction between the solid moving parts and protecting them. But, as the lubricants and technologies get better day by day, the growth decreases considerably. Synthetic lubricants are increasing their footprint in the automotive industry due to several benefits offered by them, including better fuel efficiency. This has also extended the oil drain intervals in vehicles from once in 6 to 12 months to once in 18 to 24 months. A consumer finds these extended oil drain intervals comfortable and prefers high-quality lubricants to protect their vehicle. However, this has confined the market expansion in terms of volume and is expected to result in low volume growth over the forecast period. Further, the increasing sales of electric vehicles are expected to challenge the market growth in the upcoming years as these vehicles do not use engine oil.
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Conventional Oil is Here to Stay
The conventional or mineral oil segment accounts for the lion’s share in the automotive lubricants market. Though the adoption and demand for synthetic lubricants is significantly rising, it is less likely to outward the market share of conventional oil over the forecast period due to relatively low prices of the conventional lubricants. Synthetic and semi-synthetic oil types have high adoption in developed regions such as North America and Europe as compared to developing regions of Asia-Pacific, Middle East & Africa and Latin America.
Engine Oil is poised to dominate the products segment
The engine is popularly known as the heart of a vehicle, and engine oil plays a crucial role in the proper functioning of the engine in an automobile. Engine oil helps in the proper functioning of the moving parts and also keeps the engine cool. Frequent changing of engine oil is a necessary task to improve the life span of the engine and avoid the buildup of sludge and contaminants in the engine.
As these contaminants can seriously damage the functioning of engine and vehicle or even lead to engine replacement, vehicle owners willingly change engine oils at regular intervals to avoid any haphazard and trouble. Thus, there is high adoption of engine oil as compared to other products, and it is expected to continue its dominance over the forecast period due to the high number of gasoline and diesel engines vehicles on the road. Moreover, commercial and high-duty vehicles such as tractors, trucks and other similar automotive are less likely to get replaced by alternate vehicle technologies such as e-mobility, which will ensure healthy growth of the engine oil segment in the market.
North America Automotive Lubricants Market Size, 2018
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Asia-Pacific leads the automotive lubricants market on the back of the high fleet of on-road vehicles in countries such as China, Japan, India, and South Korea. The consumption pattern of various automotive lubricants changes from country to country and region to region. For instance, the consumption of synthetic lubricants is high in South Korea as compared to India, and most of it is consumed in commercial and passenger vehicles. Whereas in India, commercial vehicles consume a high proportion of automotive lubricants followed by a two-wheeler segment, which accounts for around one-fourth of the total demand. China dominates the Asia-Pacific market on the back of the large automotive on-road fleet and increasing per capita lubricant consumption in the country.
Europe accounts for the second-largest share in the global market and has the second-largest per capita lubricant consumption in the world. The synthetic automotive lubricants segment is rapidly expanding in the region due to increased demand for high quality and efficient lubricants from the consumers. The knock-on effect of disruption caused by the rising sales of electric vehicles and the implementation of stringent environmental regulations on the automotive industry has suppressed the market growth in the region.
North America is also expected to follow a similar trend as of Europe. Commercial vehicles drive the consumption of automotive lubricants in North America.
Environmental regulations and growth of e-mobility in the region has hindered the market expansion and is likely to affect the market over the forecast period. Latin America market is dominated by Brazil and Mexico, accounting for over two-thirds of the revenue market. The region is currently recovering from economic slow-down and is also exposed to multiple political crises. This is expected to hamper the market growth over the foreseeable period.
The Middle East and Africa account for only a single-digit share in the global market. GCC countries, Turkey and Iran, dominate the demand in the region. The conventional or mineral oil segment dominates the region with over three-fourth of the market share due to low prices of base stock and low adoption & consumer awareness in the region. The political and economic crises in the region too is likely to restrict the market growth over the forecast period.
Royal Dutch Shell PLC leads in the Highly Fragmented Automotive Lubricants Market
The automotive lubricant market is dominated by a few major base oil manufacturers and formulators such as Royal Dutch Shell, ExxonMobil, BP, and others. All of the major players operate in multiple lubricants market (such as industrial lubricants, metalworking fluids, automotive lubricants, and others) and have a diversified product portfolio to fulfill the needs of a variety of customers. Royal Dutch Shell has high base oil production & formulation capacity, strong global presence, and distribution network as compared to the rivals, that make it a market leader. However, many local players dominate the regional market. For instance, In India, State-owned company -Indian Oil markets its automotive lubricants under the brand name of SERVO and leads the market with a healthy share of over 25%.
The automotive lubricants market report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product.
An Infographic Representation of Automotive Lubricants Market
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Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.
Volume (Tons) and Value (USD million)
By Oil Type
By Product Type
Fortune Business Insights says that the global market size was USD 70.25 billion in 2018 and is projected to reach USD 79.91 billion by 2026.
In 2018, the market value stood at USD 70.25 billion.
Growing at a CAGR of 1.58%, the market will exhibit steady growth in the forecast period (2019-2026).
Engine oil segment is expected to continue its dominance over the forecast period.
High-Performance requirements in vehicles is driving the growth.
Asia-Pacific leads the market in 2018.
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