BRIC Automotive Plastics Market Growth is driven by Rise in Vehicle Production
The BRIC automotive plastics market comprises of plastic components and parts used in interior, exterior, powertrain, and under-the-hood applications of various vehicles. Automotive plastics are increasingly being adopted due to their resistance to corrosion, durability, and light weight properties as compared to traditional materials such as steel. Plastics like polypropylene, polyurethane, polyvinyl chloride, polyethylene, acrylonitrile butadiene styrene, and polycarbonate find widespread applications in instrument panels, trims, bumpers, doors, airbags, seating, and electronic components. The demand for vehicle customization and rising electrification of vehicles also contributes to the growing use of plastics in automobiles.
The Global BRIC Automotive Plastics Market is estimated to be valued at US$ 32062.54 Mn in 2024 and is expected to exhibit a CAGR of 6.8% over the forecast period 2024 to 2030.
Key Takeaways
Key players operating in the BRIC automotive plastics are Unilever, Procter & Gamble, Reckitt Benckiser, Henkel AG & Co. KGaA, Church & Dwight Co. Inc., Wipro Enterprises Limited, Colgate-Palmolive Company, C.Johnson & Son Inc., Godrej Consumer Products, Kao Corporation, L'Oreal S.A., The Clorox Company, Seventh Generation, Inc., Natura &Co, Weleda Group, Patanjali Ayurved Limited, Hain Celestial, EO Products, Indus Valley, Prairie Rose. Major players are focusing on expanding their production capacities and product portfolios through collaborations, acquisitions, and new product launches to cater to the growing demand in the region.
The growing demand for light-weight and fuel-efficient vehicles in BRIC nations is expected to drive the consumption of plastic materials in automobiles. Polypropylene, polyurethane, polycarbonate, and ABS are some of the commonly used plastics in the industry. Their properties such as durability, corrosion resistance, and design flexibility in various applications are contributing to their increased adoption for automotive parts.
International automakers have been actively expanding their presence across the BRIC nations over the past few years. The increasing automotive production and rising disposable incomes have propelled the sales of commercial and passenger vehicles. This, in turn, has fueled the growth of the automotive plastics market in the region. Furthermore, the improvement in plastics technologies catering to changing design requirements across vehicle segments is boosting market revenues.
Market drivers:
The rapid growth of the automotive industry in Global Automotive Plastics Market Size is one of the key drivers propelling the demand for automotive plastics in the region. Increasing investments by OEMs into new vehicle production plants coupled with supportive government policies towards automotive manufacturing are promoting automobile sales. According to OICA, annual vehicle sales in the BRIC countries increased from 22.9 million units in 2013 to over 30 million units in 2019. This rise in vehicle production is directly influencing the consumption of plastics in various exterior and interior automotive components.
The ongoing geopolitical tensions and conflicts have significantly impacted the growth of the BRIC automotive plastics market. Russia's invasion of Ukraine has disrupted the global supply chains and export/import activities in the Eastern European region. Both Russia and Ukraine are major suppliers of raw materials like aluminum, steel, and plastic polymers that are key inputs for the automotive industry. The conflict has led to a shortage of these raw materials, pushing up their prices. It has negatively impacted the production levels in major automakers in BRIC nations, thereby lowering the demand for automotive plastics.
Furthermore, economic sanctions imposed on Russia by Western nations has restricted business operations between Russian and foreign companies. Many international automakers have halted vehicle production and parts supply in Russia. The weakened macroeconomic conditions and declining vehicle sales in Russia are expected to hamper the demand for automotive plastics in the near future. The rising inflationary pressures and interest rate hikes by central banks to curb high inflation are also impacting consumer spending patterns. It may slow down the overall car purchases, affecting the plastics requirement in the automotive industry. BRIC nations need to diversify their raw material sourcing and develop Alternate supply chains to mitigate geopolitical risks affecting their automotive manufacturing sector.
The BRIC automotive plastics market is highly concentrated in value terms in urban areas of major automobile manufacturing clusters across BRIC nations. In Brazil, the states of Sao Paulo, Rio de Janeiro and Minas Gerais account for over 60% share of the country's automotive plastics demand. In Russia, the Moscow and Saint Petersburg regions dominate due to presence of leading Russian and foreign automakers. In India, the automotive hubs of Delhi-NCR, Mumbai, Chennai, Pune and Bengaluru along with major Tier I and Tier II automotive component manufacturing facilities driving plastics consumption.
China has the largest share in BRIC automotive plastics market value owing to its position as the global vehicle production powerhouse. The provinces of Guangdong, Jiangsu, Shanghai, and Zhejiang in South Eastern China are the key industrial zones with presence of automaking giants like SAIC Motor, Great Wall Motors, GAC Group, etc. The per capita vehicle ownership and commercial vehicle fleet in metros and Tier I cities facilitate huge plastics usage. Overall, these concentrated manufacturing regions with easy availability of raw materials, logistics networks and technical expertise will continue propelling the BRIC automotive plastics demand over the coming years.
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