Lubricants Market Size & Trends
Global lubricants market size was calculated at USD 139.44 billion in the year 2023 and is expected to rise at a compound annual growth rate (CAGR) of 3.8% during 2024 to 2030. This is because of increasing demand for greases and automotive oils due to the increasing vehicle and spare parts trade. Lubricants form a vital component of fast-growing industries.
Lubricants are applied between two comparatively moving machine parts to minimize friction and wear & tear. They either remain petroleum-based or water-based and are crucial for smooth machinery operation. Lubricants reduce downtime of operation and ultimately enhance overall productivity. Lubricants find widespread applications in processing industries and automotive components, particularly engines and brakes, which require lubrication for uninterrupted smooth operation.
Growing imports and exports of piston engine lubricants are driving market growth. Consumers’ growing concern to improve vehicle performance. The launch of innovative and premium product offerings drive the demand for the product.
Growth in the future will be very much reliant on the production of motor vehicles and miles traveled by every vehicle.
Additionally, people want standard and specialist lubricants for their routine vehicles to guarantee smooth operation of their vehicles and decrease long-term maintenance expenses.
Market Concentration & Characteristics
Market development phase is medium, and the rate of the market growth is speeding up. Joint ventures, mergers and acquisitions within the industry has grown extensively during the last decade. Organizations are always looking to initiate long-term contractual agreements with reliable partners for viable business operations across the world.
Moreover, strict regulations worldwide criticize the lubricants industry from production to consumption and disposal. Experts analyze the additives applied during lubricant production for toxicity and their potential to cause environmental damage.
Regulations which affect market forces include Occupational Safety & Health Administration (OSHA), Environmental Protection Agency (EPA), Registration, Evaluation, Authorization and Restriction of Chemicals (REACH), EU Council Directive & European Registration, Evaluation, Authorization & Restriction of Chemicals (REACH) regulations.
The structure of the lubricants industry is extremely fragmented with a huge count of small, medium, as well as large-sized players. The dominant differentiation parameter is the depth of the product line. Large firms are making investments in upstream plants to sustain their high margin downstream business. The partnerships with distribution firms and expanding territorial reach are likely to impact market penetration during the forecast period.
Application Insights
The automotive industry was the most dominant sector in the world in 2023 with the greatest revenue share of 53.4%. This is due to the higher demand for consumer vehicles, including buses, trucks, and other modes of passenger transportation. Improvement in economic growth of emerging economies, including China, India, and Brazil, has resulted in the improvement of the public transportation system in these countries.
This trend will increase the demand for commercial automotive lubricants even more. Sales growth of commercial vehicles, such as heavy trucks, and construction machinery, including cranes, bulldozers, and mixers, is expected to drive growth in the Middle East & Africa region during the forecast period. The industrial segment accounted for the second-highest share in 2023 as a result of the huge industrial production in emerging markets.
Regional Insights
Asia Pacific dominated the market with a revenue share of 44.6% in 2023. The growth is due to high growth of the vehicle industry as well as the growth of industry and the availability of vehicle manufacturing industries in nations, e.g., Japan, India, and China. The most widely applied lubricants in the Asian market are automotive engine oils, greases, and hydraulic fluids.
Asia Pacific has begun to emulate the American and European regulatory models, and nations such as Japan and South Korea are therefore placing a focus on eco-labeled lubricants. Furthermore, Asia Pacific also dominates the world’s marine industry due to a high number of ports and growing trade activities with the U.S. and other developed economies.
The India lubricants market is expected to grow at a rate of 5.2% over the forecast period. Marine industries in India, China, and Singapore are expected to emerge as global port operators, driving lubricant consumption across various marine applications.
China is Asia Pacific’s biggest and most mature market, with more than 55,000 engaged businesses. As per the Society of Tribologists and Lubrication Engineers, approximately 65% of the world’s newly installed chemical material capacity during 2020 was located in China. Therefore, swift industrialization in the nation is expected to boost product demand during the forecasting period. In addition, in 2023, China recorded a rise of 11.6% in the manufacturing of vehicles to cater to growing demand.
Europe held a large revenue share in 2023 and is anticipated to record a substantial CAGR during the forecast period. The European Union (EU) automotive sector is one of the biggest industries in the world, playing a vital role in its economy. During the first three quarters of 2023, the EU manufactured over 9 million vehicles, 14% more than the previous year (Q1-Q3).
