Automobiles Remain Largest Consumer of Lubricants

Posted by Manish Kumar on December 3rd, 2020

From 66 million in 2006, global automobile sales rose to 91 million in 2019, says Organisation Internationale des Constructeurs d'Automobiles (OICA). This has been a result of the economic growth in developing countries, which has led to an increase in the purchasing power of individuals. With the growth in vehicle sales, the demand for all associated products has risen too. One of the most-widely used products in automobiles is lubricant, the main purpose of which is to reduce the wear and tear between the moving parts in mutual contact.

This is the most important factor that P&S Intelligence says will drive the lubricants market from $ 95,403.9 million in 2019 to $ 115,350.6 million in 2030, at a 2.3% CAGR during 2020–2030 (forecast period). Due to the stringent emission control regulations in place in response to the rising levels of pollutants in the atmosphere, the awareness of people about the role of lubes in achieving the same has risen. With less friction between the moving parts, the engine doesn’t have to work as hard to push the vehicle forward, which decreases the consumption of fuel and, ultimately, the emissions.

Several types of lubricating products are available, including transmission and hydraulic fluid oils, engine oils, general industrial oils, gear oils, metalworking oils, greases, and process oils. Among these, engine oils account for the heaviest consumption because of the increasing awareness among vehicle owners about the harmful effects of the burning of diesel and gasoline. In this regard, engine oil helps keep the engine running smoothly, with as little fuel as possible. This reduces the amount of GHGs being released into the atmosphere, which, in turn, helps in regulatory compliance and cleaning up the environment.

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On the basis of base oil, the lubricants market is divided into bio-based oil, mineral oil, and synthetic oil. Among these, during the historical period (2014–2019), mineral oil was the dominating division on account of the easy availability and cost-effectiveness of mineral oils and the high demand for mineral-oil-based lubes in factories. In addition, the awareness about lubricants with a mineral oil base is higher than about those with other base oils, which leads to the heavier consumption of mineral-oil lubes.

Though mineral oils are the preferred base for lubes, the demand for bio-based lubricants has begun to increase sharply. As mineral oils are derivatives of crude oil, the former’s heavy consumption is contributing to the depleting reserves of the latter. In addition, the need to reduce the dependence on petroleum (another word for crude oil) is increasing, which is leading to the shift to bio-based lubricants. Being made from organic sources, bio-based lubricants can help check fossil fuel reserve depletion and pollution.

The largest region in the lubricants market in 2019 was Asia-Pacific (APAC) as a result of its highly productive manufacturing sector, high automotive production and sales figures, and less-stringent regulations. The per capita demand for lubricants is lower here than in Europe and North America, which is why market players are increasingly targeting the APAC population. During the forecast period, the Middle East and Africa (MEA) is projected to witness the highest CAGR due to the wide and cheap availability of mineral oils, which results in the cost-effectiveness of lubricants.

Thus, as environmental concerns surge, the usage of lubricants in vehicles and industries, to reduce fuel and electricity consumption, respectively, will continue to increase.