Global Lubricant Additives Market - 2024-2031

Overview

Global Lubricant Additives Market reached US$ 16.5 billion in 2023 and is expected to reach US$ 20.6 billion by 2031, growing with a CAGR of 2.8% during the forecast period 2024-2031.

The growth in military equipment and armaments production influenced by the ongoing war in Ukraine will become a major factor behind the growing demand for lubricant additives in the metallurgy and metalworking sector over the next few years. A trend of military modernization pursued by major global powers is likely to keep demand high during the forecast period.

With the ongoing development of high-speed rail in Asia-Pacific, with new projects currently under construction in India, Indonesia, Vietnam, and Thailand, the demand for high-performance lubricant additives in the railway industry will increase over the upcoming years. The volatility in crude oil will have a major bearing on the growth of the global market during the forecast period. If oil prices experience a spike, it will increase input costs for all major end-users and discourage innovation in the industry.

Dynamics

Growing Production of Electric Vehicles

The post-pandemic period has fueled a boom in the production and sales of electric vehicles. Government stimulus to the automotive industry as part of a broad-based economic revival has led to breakthroughs in battery technology and vehicle production techniques. Nearly 14.2 million battery electric vehicles (BEVs) were sold in 2023, marking the highest increase since EV mass production began. Many conventional vehicle manufacturers are either planning to shift towards EV production or are converting their existing portfolio of gasoline and diesel vehicles into hybrid cars.

Analysts expect the price of electric vehicles to decrease further in the coming years, with most models achieving price parity with petrol and diesel-based cars in the next 4 to 5 years. The U.S. and China have witnessed the largest decrease in overall EV prices. According to data from Forbes magazine, the average EV price in the U.S. was around US$ 45,000 in mid-2023, significantly down from nearly US$ 59,000 during the previous year.

Through mastery of the supply chain and large production capacity, China has almost brought down electric vehicle prices to the level of premium petrol and diesel vehicles. The average price for a Chinese EV begins at roughly US$ 10,000 as compared to a western EV which retails for an average price range of US$ 35,000 to US$ 45,000. The ongoing development of electric vehicles opens up new growth opportunities for the global lubricant additives market. It will propel the demand for new types of lubricant additives to be used in battery coolants, specialty greases, and the next generation of brake fluids.

Growing Industrial Demand for Better Lubrication

The industrial sector is attempting to reduce energy consumption and operating expenses in light of the rising cost of energy to power modern industrial operations. To keep machinery performing at high standards, new advances in industrial lubrication are being considered with a view to drastically improving lubricant performance under high temperature and pressure conditions.

The National Lubricating Grease Institute (NGLI) performed independent testing that found that synthetic lubricant additives had higher density, viscosity, and molecular weight, which resulted in lower friction in lubricated gears. Additionally, PAG & PAO-based gear lubricant additives assist in lowering maintenance costs in cylindrical gears due to decreased churning losses at lower temperatures and less gear erosion. In June 2024, Laxness announced the launch of Additin, a new range of industrial lubricant additives and metalworking fluids for improved performance.

Volatility in Global Oil Prices

The global oil and commodities market demonstrated volatility during and after the pandemic. In the initial days of the pandemic, as demand depressed, oil prices crashed precipitously, even turning negative in April 2020. Oil prices remained in US$ 50-75 per barrel territory for most of 2021, before spiking to over US$ 120 per barrel on account of the Russia-Ukraine war. The volatility of oil prices caused various second-order impacts on the lubricant additives market.

Industrial activity and consumer spending are broadly affected due to the volatility in oil prices, thus affecting demand for lubricant additives in diverse sectors like automotive, construction, metalworking, aviation, and HVAC. Such volatility is also undesirable from the producer's point of view since it creates hurdles toward long-term planning and discourages production capacity expansion.

Segment Analysis

The global lubricant additives market is segmented based on function, lubricant, end-user, and region.

The Automotive Industry Will Continue to Remain Among the Biggest Demand Generators

The global automotive industry sustained the brunt of the pandemic relatively well and was on the road to recovery by the middle of 2022. Recovery was much faster in emerging markets like India and China, which saw a large, pent-up demand during the pandemic period. Government stimulus to boost the automotive industry has also been a key factor in driving the recovery. Data from the International Organization of Motor Vehicle Manufacturers (OICA) found that nearly 93.54 million passenger and commercial vehicles were produced in 2023, indicating a jump of nearly 10% from the previous year.

The production of electric vehicles has also received a boost in the post-pandemic period. All these factors have led to the creation of highly favorable growth conditions for the global lubricant additives market in the automotive sector. Many companies are actively working towards introducing lubricant additives derived from sustainable, bio-based sources. For example, in April 2024, DIC Corporation, a Japanese chemical company, unveiled a new algae oil-based extreme pressure additive for use in automotive lubricating oils and metalworking fluids.

Geographical Penetration

Lubricant Additive Demand to Remain High in Asia-Pacific

Asia-Pacific is the largest region for the lubricant additives market driven by the growth of the automotive, construction, and metallurgy sectors in the region. As the regional automotive industry expands, there is a parallel rise in the need for lubricant additives to maintain vehicle performance. China is the largest automotive producer with data from Nikkei Asia indicating 30 million units of automotive sales in the country in 2023.

The metallurgy and metalworking industry is also expected to become another major source of demand for lubricant additives during the forecast period, mainly due to the growth of shipbuilding activities in China, Japan, and South Korea. Emerging countries like India are also taking steps to boost their shipbuilding capacity, mainly to build up their naval forces. Asia-Pacific will continue to account for a major share of the global market during the forecast period.

Competitive Landscape

The major global players in the market include BASF SE, Lanxess, Afton Chemical, Chevron Oronite Company LLC, Croda International Plc, Evonik Industries AG, Infineum International Limited, The Lubrizol Corporation, Shamrock Oils & Petrochemicals and Jinzhou Tianhe Chemicals Co Ltd.

COVID-19 Impact Analysis

COVID-19 made a major impact on the lubricant additives market as a result of depression in economic activity across various sectors. Overall usage of passenger and commercial vehicles dropped sharply during the pandemic, thus consequently leading to decreased demand for lubricant additives. Locomotive and aerospace sectors also witnessed a major drop in demand.

Furthermore, the industrial sector also had setbacks due to shutdowns and labor shortages, which led to a decline in demand for industrial lubricants. The lockdowns and reduced travel had a significant negative impact on the demand for passenger vehicle lubricants. Maintenance cycles were disrupted and vehicle usage decreased. Also, lubrication played a critical role during the resumption of industrial activities. With industrial production rebounding in the pandemic aftermath, the demand for lubricant additives has also

Russia-Ukraine War Impact Analysis

The Russia-Ukraine war made a significant impact on the lubricant additives market resulting conflict has led to disruptions in supply chains, industries, and economies, impacting both the demand and supply of lubricants. The invasion of Ukraine by Russia caused a sudden spike in crude oil prices, which were already rising due to factors like global economic recovery from the COVID-19 pandemic. The uncertainty and geopolitical tensions resulting from the war have highlighted the vulnerability of the energy industry and the need for resilience.

Some countries released oil from their strategic reserves to stabilize prices and supply, while others aimed to boost domestic production. The volatile energy situation prompted nations to reconsider their energy policies and diversify their energy mixes to reduce dependence on a single supplier. As the conflict continues, the global lubricant market will likely continue to be influenced by geopolitical dynamics and efforts to ensure energy stability.

By Function

• Dispersants
• Viscosity Modifiers
• Anti-Wear and Extreme Pressure Additives
• Corrosion Inhibitors
• Anti-Oxidants
• Emulsifiers
• Friction Modifiers
• Others

By Lubricant

• Engine Oil
• Hydraulic Oil
• Transmission Oil
• Metalworking Oils
• Greases
• Industrial Gear Oils
• Concrete Release Agents
• Chainsaw Oils
• Compressor Oils
• Others

By End-User

• Automotive
• Locomotive
• Aerospace & Defense
• HVAC
• Building & Construction
• Metallurgy & Metalworking
• Others

By Region

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Rest of Europe
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific
• Middle East and Africa

Key Developments

• In May 2024, Scientists at the U.S. Department of Energy's Oakland National Laboratory announced the development of new lubricant additives for the protection of water turbine equipment. The new additives demonstrated a 50% reduction in friction and a nearly ten-fold decrease in operational wear as compared to commercially available lubricant additives.
• In November 2023, Trecora LLC, a U.S.-based petrochemicals manufacturer, acquired the lubricant additives business of Chemtrade. The acquired company will become part of Trecora's specialty chemicals business based in Woodlands, Texas, U.S.

Why Purchase the Report?

• To visualize the global lubricant additives market segmentation based on function, lubricant, end-user, and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of cement market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Lubricant mapping available as Excel consisting of key products of all the major players.

The global lubricant additives market report would provide approximately 62 tables, 69 figures, and 198 Pages.

Target Audience 2024

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies