The global electric vehicle plastics market is gaining huge traction owing to the strict emission norms and shifting consumer preference for greener mobility solutions. Electric vehicles employ different types of plastics such as polypropylene, polyamide, ABS, polycarbonate, and polyurethane to reduce the overall weight and improves the design flexibility of electric vehicles. Plastics are used in various exterior and interior automotive parts including battery enclosures, cockpit control panels, door modules, consoles, bumpers, and instrument panels in electric vehicles. The lightweight nature of plastics helps boost the driving range of electric vehicles by reducing the overall vehicle weight. With government incentives and subsidies, the demand for electric vehicles is on an exponential rise worldwide which in turn is propelling the use of plastics in electric vehicles.
The Global Electric Vehicle Plastics Market Size is estimated to be valued at US$ 4.09 BN in 2024 and is expected to exhibit a CAGR of 27.% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the global electric vehicle plastics market are LANXESS, INEOS Group, Celanese Corp., AGC Chemicals, EMS-Chemie Holding, Mitsubishi Engineering Plastics Corp., BASF SE, SABIC, LyondellBasell Industries Holdings B.V., Evonik Industries, Covestro AG, Dupont, Sumitomo Chemicals Co. Ltd., LG Chem, Asahi Kasei.
These players are focusing on capacity expansion, new product development, and mergers & acquisitions to strengthen their market position. For instance, in 2021, Celanese Corp. announced to invest $50 million to expand its engineered materials production capacity in Nanjing, China to cater to the growing demand from EVs.
The exponential rise in electric vehicle sales is fueling huge opportunities for plastics manufacturers in the form of increased material demand from OEMs. Plastics are increasingly being adopted to replace traditional materials and further lower the vehicle weight.
Geographical expansion into new markets like Europe, China, and North America through strategic partnerships offers lucrative growth prospects for plastic suppliers. With China and Europe leading the global EV revolution through strong policy support, these regions present massive business opportunities.
Market Drivers
Stringent emission regulations worldwide are driving automakers to go electric at a massive scale. This in turn is generating huge demand for lightweight and sustainable plastics from EV manufacturers. EVs use 10-20% more plastics than conventional vehicles to reduce weight and improve driving range which is a key market driver. Government subsidies for EV purchases are also nudging consumers towards eco-friendly mobility, thereby boosting plastic consumption. Rising raw material availability along with technological advancements will support the EV plastic market growth during the forecast period.
PEST Analysis
Political: Government policies like subsidies for the purchase of electric vehicles or tax rebates have encouraged the adoption of electric vehicles in recent years. Some countries have also implemented bans or restrictions on petrol and diesel vehicles leading to growth in electric vehicles.
Economic: Lower operating costs of electric vehicles compared to petrol or diesel vehicles and increasing fuel prices are major economic factors driving electric vehicle adoption. Higher disposable incomes have also contributed to growth.
Social: Rising environmental awareness and consumers wanting greener transport options are key social drivers. Younger consumers especially appear more concerned about sustainability. Evolving lifestyles and urbanization have increased preference for personal mobility solutions.
Technological: Advancements in battery technology have improved driving ranges of electric vehicles making them more viable for everyday use. Newer battery chemistries offer higher energy density at lower costs. Connectivity features and Over-The-Air updates have enhanced the user experience of electric vehicles.
The market for electric vehicle plastics in terms of value is concentrated most in Asia Pacific region due to presence of several automotive hubs and electric vehicle manufacturers in countries like China, Japan and South Korea. China alone accounts for over 40% of the global electric vehicle sales. Europe is another major regional market driven by stringent emission norms and support for electric vehicles in countries like Germany, France, UK, Netherlands etc. North America is also seeing electric vehicle adoption grow particularly in United States due to supportive federal and state incentives and policies.
In terms of fastest growth, the electric vehicle plastics market is projected to witness strongest gains in Asia Pacific region from 2024-2031. This is because some countries like India and ASEAN nations are still in the early adoption phase of electric vehicles but government initiatives are accelerating the transition. As electric vehicles become more affordable and attain price parity with petrol/diesel models over the forecast period, sales volumes are expected to surge multi-fold in the Asia Pacific region leading to impressive growth in demand for plastics used in electric vehicle manufacturing.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
