Market Trends of India Automotive Lubricants Industry
Engine Oil to Dominate the Market
- Engine oils are widely used for lubricating internal combustion engines in different types of automobiles. They are generally composed of base oils and additives.
- The base stock is either made using petroleum, synthetic chemicals, or both. The base stock is responsible for lubricating the engine's moving parts and removing the excess built-up heat.
- Various additives added to engine oils include oxidation inhibitor additives, dispersant additives, detergent additives, anti-foam additives, viscosity index modifiers, anti-wear additives, corrosion inhibitor additives, and antifreeze additives. It controls the oil's viscosity and lubricity and protects the engine parts against wear and tear.
- Some of the most important things that engine oils do are protect against corrosion and wear and tear so that the engine lasts longer and works better, reduce friction so that the engine works better and uses less fuel, get rid of impurities so that the engine is clean, make the engine as efficient as possible, and keep energy from escaping by keeping it cool.
- According to IBEF, India holds a strong position in heavy vehicles market globally. It is the largest producer of tractor, second-largest manufacturer of bus, and third-largest heavy truck producer globally. This leads to the increased demand for engine oil from automotive sector.
- The country witnessed a significant increase in the sales of passenger vehicles and commercial vehicles. For instance, according to International Organization of Motor Vehicle Manufacturers (OICA), the production of commercial vehicles in 2022 in India was 1.02 million units.
- In addition, according to OICA, the sales of new vehicles in India increased from 3,816,858 units in 2019 to 4,725,472 units in 2022 with 23.8 % rise.
- According to Society of Indian Automobile Manufacturers (SIAM), the domestic sales of commercial vehicles increased from 7,16,566 units in 2021 to 9,62,468 units in 2022.
- Moreover, according to OICA, the production of motor vehicle in India incresed by 21% from the previous year. The production increased from 4.4 million units in 2021 to 5.46 million units in 2022.
- Moreover, according to IBEF, India’s annual production of automobiles in FY22 reached 22.93 million vehicles.
- So, because of all of these things, the engine oil segment is expected to lead the lubricants market in India over the next few years.
Understand The Key Trends Shaping This Market
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Rising Use of Passenger Vehicles In The Country
- Automotive lubricants provide durability and protection and increase the efficiency of passenger vehicles. As a result, the improving passenger vehicle segment will significantly fuel market growth during the forecast period.
- Transmission and gear oil are consumed significantly in passenger vehicles.
- The growing preference for automatic transmissions over manual transmissions in passenger vehicles has increased the demand for automatic transmission oils.
- Passenger vehicles require high-performance greases. Due to properties like mechanical stability, temperature tolerance, water resistance, and oxidant resistance, grease is used in various auto parts, such as wheel bearings, universal joints, suspensions, gears, switches, and connectors.
- Lubricants are used a lot to keep gear teeth from breaking from friction and to make sure things work smoothly and well.
- The country witnessed a significant increase in the production of passenger vehicles. For instance, according to OICA, the production of passenger vehicles reached 3,792,356 units in 2022, representing an increase of 23% compared to the previous year.
- Furthermore, according to the latest data published by the Society of Indian Automobile Manufacturers, domestic sales of passenger vehicles reached 38,90,114 units in November 2022. Thus, with the rising production and sales of passenger vehicles, the demand for automotive lubricants increases significantly in the country.
- Moreover,a ccording to the Society of Indian Automobile Manufacturers, export of automobile reached 6,62,891 units for the financial year 2022-23 with increase from 5,77,875 units in 2022-2021.
- Therefore, owing to all the aforementioned factors, the expanding passenger vehicle segment is likely to increase the demand for lubricants in India during the forecast period.
