The global Polyurethane Market size is expected to reach USD 94.59 billion by 2028, registering a CAGR of 3.8% over the forecast period, according to a new report by Grand View Research, Inc. Increasing demand for lightweight and high-performance composites from the automotive industry is driving the growth of the market. Polyurethane (PU) is widely used in automotive applications, such as seating, instrument panels, exterior panels, engine encapsulation, and cables & wires, as an alternative to metals. The utilization of Thermoplastic Polyurethane (TPU) in auto components can drastically decrease the overall weight of automobiles, which, in turn, limits fuel consumption.
Growing Corporate Average Fuel Economy (CAFE) has forced automobile manufacturers to seek innovative ways to limit fuel consumption. The low weight of vehicles is a crucial factor in these regulations due to the inherent correlation between mass and fuel consumption. Also, the reduction in mass at unhinged points facilitates reduction in noise & vibration and smoothens the ride. Auto manufacturers, for enhancing the performance of automobiles and following the trend of lightweight vehicles, are mainly focusing on auto components, which are manufactured from various types of plastics.
For improving fuel efficiency in vehicles, manufacturers have shifted toward using plastics in automotive components, such as instrument panels, exterior panels, automotive interiors, and engine cabins. This trend, coupled with growing automotive production, is expected to further drive the demand for polyurethanes in automotive applications, such as exterior body panels, engine encapsulation, and interior panels.
However, the Covid-19 outbreak has immensely affected the production of automobiles and disrupted the value chain of the automotive industry. Slowdown or halt in manufacturing activities and weak consumer sentiments are expected to affect the product demand in automotive applications.
The electronics & appliances application segment is anticipated to progress at a substantial growth rate over the forecast period. Polyurethane is used in the manufacturing of printed circuit boards, electronic housings, protective covers, and others. It offers lower unit costs and faster production while providing excellent general performance in electronic devices. Increasing importance for encapsulation of electronic components, such as circuits and sensors, is a major factor driving the product demand in electronics & appliances.
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Polyurethane Market Report Highlights
- The global market was valued at USD 70.67 billion in 2020 and is estimated to grow at a CAGR of 3.8% from 2021 to 2028
- In terms of revenue, rigid foam accounted for a prominent share in 2020 and is further expected to witness steady growth over the forecast period
- The construction application segment dominated the global market and accounted for a revenue share of more than 26% in 2020
- Asia Pacific accounted for more than 44% share of the global revenue. The robust manufacturing base of the automotive and electronics & appliances industries across China, India, South Korea, and Japan is anticipated to augment regional market growth in the near future
- Various strategic initiatives were recorded over the past few years to boost the market growth
- For instance, in January 2020, BASF SE announced a capacity expansion of its water-based PU dispersion by 30% located in Castellbisbal, Spain. This expansion will enable the company to cater to the growing product demand from the packaging, building & construction, and automotive industries