Carbon Fiber Market Size, Share & COVID-19 Impact Analysis, By Precursor (PAN, and Pitch), By Tow (Large Tow, and Small Tow), By Application (Aviation, Aerospace & Defense, Automotive, Wind Turbines, Sports & Leisure, Construction, and Others), and Regional Forecast, 2021-2028

The global carbon fiber market size was USD 2.23 billion in 2020 and is projected to grow from USD 2.33 billion in 2021 to USD 4.08 billion in 2028 at a CAGR of 8.3% during 2021-2028. The global impact of COVID-19 has been unprecedented and staggering, with this fiber witnessing a slight drop in demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a decline of 6.1% in 2020. The sudden rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

The rising upcoming development in the fields of automobiles, aerospace & defense, and wind energy industries shall augment the market growth. Growing automotive demand, along with an increasing need for lightweight vehicles, is anticipated to drive the overall market. The need for fuel-efficient vehicles and strict government regulations regarding carbon emissions are key factors driving the industry outlook.

Partial Shutdown of Composite Companies to Slow Down Product Manufacturing  

The coronavirus outbreak has halted most of the composites businesses due to the nationwide lockdown and a partial shutdown of factories. In the COVID-19 pandemic, automobile manufacturers globally are facing severe impacts. Major automotive manufacturing countries, including the U.S., Germany, the U.K., Italy, South Korea, and Japan, were the most affected countries during the pandemic. The majority of automobile manufacturers will see a direct impact of the situation on their 2020 revenue.

The pandemic is also forcing OEMs and suppliers from all tiers to rethink the supply chain model, from raw material sourcing to finished product production. For example, GM, Ford, and FCA suspended their manufacturing parts business in the U.S. and repurposed for producing COVID–19 medical devices.  Also, Toyota halted its production in Europe as the government restrictions on supply chain disruptions, falling sales, and movement of people. Honda closed its four U.S. vehicle plants due to market decline as a result of the coronavirus outbreak.

LATEST TRENDS

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Researchers Focus on Converting Coal into Carbon Fiber (CF)  

Industry partners and researchers are implementing projects that will convert coal tar, a by-product, from coke production for the steel industry into CF and composites. This new CF product could increase the coal tar pitch value by five to 55 times its current value and find applications in low weight and high stiffness composites.

In December 2020, the U.S. Department of Energy’s (DOE) Oak Ridge National Laboratory (ORNL) and the University of Kentucky Center for Applied Energy Research (CAER) entered into a strategic partnership for around USD 10 million projects which mainly converts coal into CFs and composite. Mainly, the research will report major challenges related to various coal feedstock, coal processing, and CF manufacturing. CAER’s will focus on converting various coal feedstock into CF and composites. Whereas ORNL’s role will be to correlate the coal’s molecular structure.

DRIVING FACTORS

Increasing Product Usage in Automotive Sector to Drive Market Growth

Rising car production, along with the surging need for lightweight vehicles, is likely to fuel the carbon fiber market growth. The increasing demand from manufacturers to produce automotive body parts such as hoods, deck lids, bumper beams, and fenders may favor the product demand. Adopting carbon fibers increases the durability of vehicles, thus longer life auto parts. Composites are primarily used in motorsports and luxury vehicles, which are driving the market.

Companies are adopting strategies and investing in processes that can reduce the overall vehicle’s weight. Hence, the application of carbon fiber reinforced polymer (CFRP) is widely used in high-end supercars. The material has a very high strength-to-weight ratio, and the density is as low as 1.6g/cc, making it extremely lightweight. The advantage of a lightweight car is to have better fuel efficiency, and a 10% reduction in weight can save up to 6% to 8% of fuel in automobiles.

Car companies such as Audi, BMW, Honda, Polestar, and General Motors are focusing on collaborating with carbon composite material manufacturers for mass production and are investing in their processes to support low-cost composite materials. For instance, in May 2019, General Motors collaborated with Teijin, a Japanese information technology, chemical, and pharmaceutical company, to use CFRTP in its high production vehicle, and the material is being used for the mass production of vehicles.

RESTRAINING FACTORS

High Cost of Product to Hinder Market Growth Slightly

Carbon composites are widely used in the aerospace, automotive, construction, oil & gas, and wind energy industries owing to their high performance and lightweight properties. But, the cost of the product is high as compared to metal. The cost of the product is a major restraining factor, which is prohibiting the widespread usage of carbon composites in various industries. The cost of CF is directly related to the yield and cost of the precursor from which it is obtained. At present, the PAN-based carbon fibers and their average cost of non-aerospace grade are around USD 21.5 per kg, with a conversion efficiency of only 50%.

If the product cost is decreased, it will be used on a much larger scale in the automotive and aerospace industries. Various initiatives are underway to reduce costs, which include the development of low-cost and high yield precursors for manufacturers. It will significantly reduce the CF cost. Also, researchers at the U.S. Department of Energy's Oak Ridge National Laboratory (ORNL) demonstrated a production method that will reduce the product cost by up to 50% and the energy used in its production by more than 60%.

SEGMENTATION

By Precursor Analysis

PAN Segment to Hold Largest Carbon Fiber Market Share   

Based on the precursor, the market is segmented into PAN and pitch.

The polyacrylonitrile (PAN) segment is anticipated to dominate the market during the forecast period. It finds wide use in aerospace & defense, automotive, and sporting goods applications owing to cost-effectiveness, high modulus, high tensile strength, and better quality of fiber produced. 

The pitch-based segment may show a significant growth rate during the forecast period. Properties such as low electrical resistivity, low negative coefficient, high thermal conductivity, and high modulus make it suitable for the aerospace and sports industries.

By Tow Analysis

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Small Tow Segment to Dominate Market during Forecast Period

Based on the tow, the market is segmented into small tow and large tow. The small tow segment accounted for the major share in 2020. Small tow fibers are broadly used in the aerospace industry due to their high modulus and tensile strength. It mainly refers to rovings that contain 24,000 (24K) or fewer filaments.

The composite fiber tow tests are in accordance with ASTM D 4018-17 standards. Also, companies are forming strategies to produce large-tow intermediate modulus. For instance, in November 2017, Solvay acquired European Carbon Fiber GmbH (ECF), a German-based large-tow PAN fiber producer. This acquisition will enable Solvay to develop a portfolio of large-tow fibers to complement the company’s existing range of PAN and pitch aerospace-grade fibers.

By Application Analysis

Aviation, Aerospace & Defense Segment to Hold Major Share Due to Increased Aircraft Manufacturing

Based on the application, the market is segmented into aviation, aerospace & defense, automotive, wind turbines, sports & leisure, construction, and others.

The aviation, aerospace & defense segment accounted for the highest market share in 2020 and may continue its dominance during the foreseeable time period. The rising production of aircraft by Airbus and Boeing is likely to drive the market growth. Composite materials are used in the aerospace industry in applications such as interiors, engine blades, propellers/rotors, brackets, single-aisle wings, and wide-body wings. Additionally, aerospace engineers are working to make flight more sustainable and safer, which has led to the use of fiber composite materials in helicopters, planes, and space shuttles.

Nowadays, composite materials make up to 40% of modern aircraft. For instance, the Boeing 787 Dreamliner passenger plane is composed of about 50% of composite material by weight, mostly carbon fiber sandwich or laminate. Fiber materials make up the main body, parts of the tail, wings, and fuselage of the aircraft. Boeing states that using carbon and other composite materials allows for less maintenance as they do not corrode.

The product is gaining prominence in the sporting industry. The increasing use of high-performance and lightweight materials in sports equipment will drive the market growth in sports & leisure applications. In tennis, the materials is utilized to manufacture lighter and uniquely-shaped rackets that allow players to hit the ball faster. In high-performance cycling, carbon composite reduces the bicycle's weight, thereby improving lap times.

REGIONAL INSIGHTS

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Europe stood at USD 0.76 billion in 2020 and is expected to dominate the market during the forecast period. The regional growth is attributed to the presence of a wide base of electric car manufacturers and the increasing demand for lightweight and fuel-efficient vehicles. Accelerating usage in the aerospace & defense industry is likely to drive regional market growth. Automakers are spending in R&D to develop cost-effective carbon composite materials and are thus driving the automotive business in the region.

Germany's market may witness a favorable growth rate due to the presence of a well-developed aviation sector. Eurofighter and Airbus A320 family have their manufacturing units in Germany. The country is one of the leading manufacturing bases for the aircraft industry and is mainly home to different manufacturers such as material and component suppliers, equipment manufacturers, whole system integrators, and engine producers. For instance, in February 2019, the German Aerospace Center developed a de-icing solution for critical points on aircraft utilizing CF and electricity.

The rising demand for lightweight composite materials in the aviation sector is likely to drive the North American market size. Airbus, United Airlines, Inc., The Boeing Co., and American Airlines Group Inc. are some of the key participants operating in the region. The rising demand to utilize renewable resources has led to a surge in the installation and demand for wind farms in this region. 

The rapid urbanization and growing government spending on infrastructure projects, mainly in India and China, are increasing the use of construction composites in building tunnels, bridges, and houses. The presence of key players in the Asia Pacific region has created a huge market opportunity in the construction business, thus driving the construction composite market growth. According to the Building and Construction Authority (BCA), the total construction demand in 2021 would range between USD 23 billion and USD 28 billion in Singapore. Therefore, a rise in construction projects or contracts can create a huge demand for the construction composites market.

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Rapid urbanization and the growing automotive industry in Brazil shall favor the industry outlook in the Latin American region. Brazil’s automotive carbon composites market contains several large and small supplier companies such as Cromitec, Fiacbras, Elekeiroz, and Embrapol. A well-developed aerospace & defense industry in Israel and good trade relations with the U.S. for defense and military projects are likely to create a huge opportunity in the Middle East.

KEY INDUSTRY PLAYERS

Companies are Focusing on Strategic Partnership and Acquisition to Strengthen Their Market Reach

Key players operating in the industry are ZOLTEK Corporation, Hexcel Corporation, Toray Industries, Solvay, and Teijin Limited. Most of the key producers are focusing on acquisition, new product launches, and strategic partnerships to enhance their product portfolios, broaden their market reach, and gain a competitive edge over other key participants. Also, aircraft manufacturers and their suppliers are focusing on production.

• August 2020, Mitsubishi Chemical Corporation completed the acquisition of CFK Valley Stade Recycling GmbH & Co. KG (CFK) and carboNXT, two German carbon fiber recycling companies.


• February 2020, The ANAND Group collaborated with FAR-UK for the development of carbon fiber composites and for reducing carbon emission. FAR-UK manufactures and designs lightweight structural composite solutions.

LIST OF KEY COMPANIES PROFILED:

• ZOLTEK Corporation (Missouri, U.S.)


• Hexcel Corporation (Connecticut, U.S.)


• TEIJIN LIMITED (Tokyo, Japan)


• TORAY INDUSTRIES, INC. (Tokyo, Japan)


• Solvay (Brussels, Belgium)


• Formosa M Co., Ltd. (Gyeonggi-do, Korea)


• Mitsubishi Chemical Carbon Fiber and Composites, Inc. (California, U.S.)


• Nippon Graphite Fiber Co., Ltd. (Hyogo, Japan)


• Advanced Composites Inc. (Utah, U.S.)


• HYOSUNG ADVANCED MATERIALS (Seoul, South Korea)

KEY INDUSTRY DEVELOPMENTS:

• February 2021 –­ Teijin Limited launched Tenax BM (beam series) and Tenax PW (power series) brands of this type of fiber intermediate materials for sports applications. This launch will help the company to maximize power and speed due its exceptional durability and toughness.


• August 2020 – Mitsubishi Chemical Corporation acquired carboNXT GmbH and CFK Valley Stade Recycling GmbH & Co. KG (CFK), two German carbon fiber recycling companies, through its subsidiary Mitsubishi Chemical Advanced Materials in Zurich, Switzerland.

REPORT COVERAGE

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The market report provides a detailed analysis of the market and focuses on crucial aspects such as leading companies, materials, products, and applications. Also, it offers insights into carbon fiber market trends and highlights vital industry developments. It includes historical data & forecasts revenue growth at global, regional, and country levels and analyzes the industry's latest market dynamics and opportunities. In addition to the factors mentioned above, the report encompasses various factors contributing to the market's growth in recent years.

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