Electric Vehicle Plastics Market

Electric Vehicle Plastics: Revolutionizing Sustainability and Performance

Electric vehicles (EVs) have gained significant momentum in recent years as a cleaner and more sustainable alternative to traditional combustion engine vehicles. While the focus often revolves around battery technology and charging infrastructure, the role of plastics in EVs is equally crucial. This essay explores the importance of electric vehicle plastics, their impact on sustainability and performance, and the key factors and government policies shaping their usage.

The Role of Plastics in Electric Vehicles

Plastics play a vital role in various aspects of electric vehicles, contributing to their overall performance, safety, and sustainability. The lightweight nature of plastics makes them ideal for reducing vehicle weight, increasing energy efficiency, and extending battery range. Additionally, plastics offer flexibility in design, allowing for streamlined aerodynamics and improved vehicle handling. These factors contribute to the overall driving experience and help overcome some of the limitations associated with EV technology.

Impact on Sustainability

One of the key advantages of electric vehicle plastics lies in their positive environmental impact. By utilizing lightweight plastics, EV manufacturers can reduce the overall vehicle weight, resulting in decreased energy consumption and emissions. Furthermore, many plastics used in EVs are recyclable and can be incorporated into a circular economy, reducing waste and conserving resources. The use of sustainable plastics, such as bioplastics derived from renewable sources, further enhances the eco-friendliness of electric vehicles.

Performance Enhancement

Electric vehicle plastics also contribute to improved performance and safety. Plastics used in EVs are known for their excellent thermal and electrical insulation properties, protecting critical components from heat and electric hazards. Additionally, plastics can be molded into complex shapes, facilitating the integration of various components and enhancing overall vehicle safety. Furthermore, the vibration-damping characteristics of plastics contribute to a quieter and more comfortable ride for passengers.

Top Impacting Factors

Material Selection: The choice of plastics used in electric vehicles is crucial. Manufacturers are increasingly focusing on high-performance engineering plastics that offer a balance between strength, durability, and sustainability. Factors such as weight reduction, recyclability, and resistance to temperature and chemicals play a vital role in material selection.

Battery Enclosures: Plastics are extensively used in battery enclosures to protect the batteries from external impacts and ensure efficient thermal management. Lightweight yet robust plastics offer superior impact resistance and insulation properties, enhancing the safety and performance of EV batteries.

Interior Components: Plastics find wide application in interior components, including dashboard panels, seating, and trim. The use of innovative plastics enhances the aesthetic appeal, durability, and comfort of EV interiors, creating a positive user experience.

Government Policies

Governments worldwide play a crucial role in promoting the adoption of electric vehicles through supportive policies. Some key government policies related to electric vehicle plastics include:

Recycling Initiatives: Governments incentivize recycling of plastics by implementing policies that encourage the collection, sorting, and recycling of EV plastic waste. This promotes the use of recycled plastics in new vehicles, fostering a circular economy.

Emission Standards: Governments impose strict emission standards that encourage automakers to develop lightweight and energy-efficient electric vehicles. Plastics enable manufacturers to meet these standards by reducing vehicle weight and enhancing energy efficiency.

Research and Development Funding: Governments provide research grants and funding to support the development of sustainable plastics and innovative manufacturing processes. This encourages the industry to explore new materials and technologies that can further enhance the performance and sustainability of electric vehicle plastics.

Dynamics of Electric Vehicle Plastics Market

Drivers in Electric Vehicle Plastics Market

OEMs' Preference for Thermally Stable Plastics in Heat-Sensitive Applications

Automotive Original Equipment Manufacturers (OEMs) are increasingly gravitating towards thermally stable plastics for heat-sensitive applications. This inclination stems from the need to enhance the range of new-generation electric and hybrid vehicles by making them lighter and stronger. Specifically, OEMs are focusing on key application segments in electric vehicles, such as electric motors, battery thermal management, and chassis. By utilizing high-performance plastic materials, particularly those based on polyamides, numerous underhood components can be replaced with metal, offering benefits such as high tensile strength, resistance to high temperatures, and reduced weight.

In the realm of electric vehicles, thermally conductive plastics are proving to be advantageous in LED enclosures and electric battery housings. These plastics enable the safe utilization of higher voltages while offering increased opportunities for lightweighting. Additionally, they provide enhanced customization options and facilitate the creation of more efficient and uniform thermal management systems.

Polyamides also present promising prospects in battery trays and connectors for electric vehicles, which often feature an array of sensors, cameras, and radars. Polyamide connectors, molded to capitalize on their temperature resistance properties, are utilized by manufacturers such as BASF. By employing specialized grades of polyamide and polybutylene terephthalate, BASF meets the requirements for flame retardancy, color stability, and electrical isolation. This not only contributes to weight reduction and space optimization around the battery pack but also enhances vehicle safety. Consequently, the demand for thermally stable plastics is on the rise within the electric and hybrid vehicle segment.

Restraints in Electric Vehicle Plastics Market

Plastic Recycling Challenges in Electric Vehicles

Plastics play a crucial role in achieving lightweight and fuel-efficient vehicles, thereby reducing their environmental impact. The automotive industry has increasingly prioritized sustainability as a key driver of innovation and future growth. Electric vehicles, due to their lower environmental impact compared to internal combustion engine (ICE) vehicles, are experiencing a surge in sales. However, leading OEMs have highlighted that approximately 33% of a vehicle's lifetime CO2 emissions are attributed to the materials used and their production. Consequently, the automotive industry must address the sustainability of materials utilized in electric vehicles and make the production process more environmentally friendly.

To effectively tackle this challenge, manufacturers must explore circular pathways for automotive plastics, considering how materials from end-of-life vehicles can be integrated into new models to enhance sustainability. As a result, manufacturers are investing in innovative recycling methods to effectively repurpose end-of-life automotive materials without compromising product quality. Despite these efforts, the recycling of plastics in electric vehicles remains a constraint on the growth of the electric vehicle plastics market.

Opportunities in Electric Vehicle Plastics Market

Utilizing antimicrobial plastics/additives in electric vehicles to ensure occupants' safety and well-being

Antimicrobial plastics are plastic materials equipped with properties that hinder the growth of microorganisms like bacteria and fungi. Given the impact of COVID-19, antibacterial plastic is predicted to gain significant traction within the automotive industry. Recognizing this as a favorable opportunity, numerous suppliers of car care products have introduced antimicrobial surface protection treatments tailored specifically for vehicles.

Researchers at the Hong Kong University of Science and Technology have successfully developed a groundbreaking coating known as multilevel antimicrobial polymer (MAP-1). This innovative coating demonstrates the capability to effectively eliminate viruses, bacteria, and even resilient spores, thereby potentially combating COVID-19 as well. The development of MAP-1 involved a unique combination of versatile antimicrobial polymers, which offer a prolonged effective period of up to 90 days. Remarkably, this coating can be applied to a wide range of surfaces, including metals, concrete, wood, glass, plastics, fabrics, leather, and textiles, without altering their appearance or tactile qualities. Consequently, due to growing concerns regarding hygiene within vehicle interiors and frequently touched components, it is highly likely that electric vehicle manufacturers will embrace antimicrobial plastics in the near future.

Moreover, a significant proportion of modern vehicle parts, both interior and exterior, are constructed using plastics. Commonly employed plastics include polyurethanes, polypropylene, polyethylene, and engineering plastics like acrylonitrile butadiene styrene, acrylic-styrene-acrylonitrile, polybutylene terephthalate, polyoxymethylene, and polyamide. Antimicrobial additives are primarily utilized in the production of dashboards, steering wheels, loudspeaker grills, carpets, door linings, seat belts, and airbags. Given their widespread application in vehicle interiors and exteriors, antimicrobial plastics align well with future vehicles from a hygiene standpoint.

Challenges in Electric Vehicle Plastics Market

High capital and infrastructure costs for plastic re-engineering

A prominent challenge in the realm of plastic re-engineering is the relatively high costs associated with capital and infrastructure requirements. Overcoming these obstacles entails raising manufacturers' awareness about the recycling potential of these plastics and establishing the necessary infrastructure. Moreover, component manufacturers often lack knowledge concerning the recyclability of specific plastic types incorporated in their designs. The recycling of plastics and composites extracted from complex and durable products remains restricted due to technological and economic limitations.

For instance, automotive applications predominantly utilize thermosets. Thermoset materials solidify into a specific shape through the application of heat, resulting in permanent cross-links that confer a high degree of rigidity and irreversibly alter the material. Once set, thermoset materials cannot revert to their original form. In contrast, thermoplastic materials become pliable when heated, allowing for molding, but they do not undergo curing. Typically, these materials start as pellets and are molded after heating. As the material cools, it solidifies, but no irreversible chemical change occurs. This property enables thermoplastic materials to be repeatedly reprocessed, albeit with some degradation over time. Additionally, obstacles in plastic recycling include a lack of technology, infrastructure, and a limited market for recycled materials. Separating plastics from other materials often proves challenging, and the absence of significant investments in infrastructure and cutting-edge technology renders the recycling process costly.

To properly recycle plastics, sophisticated facilities equipped with state-of-the-art technology are necessary, surpassing the capabilities of conventional car-crushing compactors. These facilities require substantial investments and employ plastic separation technologies such as magnetic separation, eddy current separators, float-sink tanks, and laser and infrared systems. These methods enable the differentiation and separation of plastics based on their color.

Ecosystem of Electric Vehicle Plastics Market

BEV Vehicle type poised to stimulate demand due to its increasing popularity and elimination of CO2 emissions

The BEV segment is projected to experience the most rapid growth during the forecast period due to its faster adoption compared to other EV segments. This can be attributed to stringent air pollution regulations and the shift towards electric mobility as a means to reduce CO2 emissions. With advancements in weight reduction and improved range, the demand for electric vehicles is expected to surge in the upcoming years, thereby driving the need for lightweight plastics, particularly polypropylene. The emphasis on reducing weight to enhance the driving range of BEVs presents fresh opportunities for plastics, given their lighter weight and relatively lower cost compared to metal counterparts. Automotive seating solutions often favor polyurethanes (PU) due to their excellent manufacturability. The rising demand for interior comfort is driving the need for PU in EVs. Polypropylene (PP) exhibits a lower density than other plastic materials, making it a viable avenue for reducing vehicle weight. Moreover, PP boasts good recyclability, allowing for its reuse as raw material and contributing to a reduction in plastic waste. Hence, the increasing adoption of BEV vehicles, when compared to other EV vehicle types, is expected to fuel the demand for plastic components employed in these vehicles. The other variants of EVs, besides BEVs, encompass Plug-in Hybrid Vehicles (PHEVs) and Hybrid Electric Vehicles (HEVs). PHEVs incorporate batteries to power the electric motor alongside an alternative fuel source to power the internal combustion engine (ICE). The vehicle automatically switches to the ICE when the battery is completely depleted. However, BEVs are preferred over PHEVs due to their superior efficiency and lower maintenance costs. HEVs combine an ICE with an electric motor that utilizes energy stored in batteries. The additional power generated by the electric motor can allow for a smaller ICE, thereby reducing engine idling when the vehicle is stationary. These factors enhance performance and offer improved fuel economy as well.

Polypropylene emerges as the favored material among OEMs for lightweight plastic components

Polypropylene is a thermoplastic created by combining propylene monomers. It is commonly employed as a binder for thermoplastic components used in composites made from natural fibers. With its low electrical conductivity, polypropylene is well-suited for producing electronic components utilized in interior applications. Additionally, it stands out as one of the lightest commercially available plastic materials, boasting a density of 0.905 g/cm3. This characteristic makes it an ideal choice for manufacturing lightweight components. Polypropylene exhibits exceptional resistance to weather conditions and chemicals, making it an attractive option for exterior vehicle applications such as bumpers. These mechanical properties enable significant weight reduction across the entire vehicle when components made from polypropylene are utilized. Reduced vehicle weight enhances fuel efficiency and driving range, thereby lowering overall CO2 emissions. As reducing CO2 emissions represents a top priority for many nations, propylene becomes an enticing material for use in electric vehicles, which have witnessed remarkable global adoption. Consequently, it is expected to exhibit the fastest growth rate among other plastic materials.

Last year, PU dominated the global industry, accounting for the largest share of 28.7% of the overall revenue. It possesses enhanced characteristics such as water resistance, radiation resistance, toughness, and chemical resistance, among others. Polyurethane contributes to increased power and crash safety in EV batteries. Moreover, it finds applications in insulation panels, suspension bushings, foam seating, cushions, electrical compounds, and more. These factors are anticipated to drive the demand for plastics in EVs throughout the forecast period. On the other hand, the PP segment is projected to witness the fastest growth rate during the forecast period. Polypropylene manufacturers are developing various grades of PP to reduce vehicle weight, thereby extending the range

The interior trim segment held the dominant position in the industry during the previous year and accounted for over 14% of the total revenue. This segment encompasses various components, including steering and dashboards, car upholstery, bumpers, door assemblies, exterior trim, connectors and cables, batteries, lighting, electric wiring, and interior trim. Acrylonitrile butadiene styrene (ABS) is a prominent plastic utilized in the manufacturing of steering and dashboards due to its advantageous properties such as tensile strength, surface hardness, heat resistance, and chemical resistance. For car upholstery, Polymethyl Methacrylate (PMMA) is preferred as it offers a transparent and glossy finish, hardness, and scratch resistance, among other benefits.

The interior component segment comprises door linings, roof linings, seat trims, steering covers, and other components, all aimed at providing comfort and a pleasant environment inside the vehicle. On the other hand, exterior trim elements such as wheel covers, headlights, fenders, and others contribute to the vehicle's aesthetic appeal. The utilization of plastics in battery production reduces production costs and replaces metallic components. Plastics like polypropylene (PP) possess enhanced shock absorption capabilities, safeguarding batteries from accidental shocks. Additionally, polyethylene terephthalate (PET) serves as an effective insulator, preventing short-circuiting and acting as a separator.

In the previous year, the exterior application segment emerged as the dominant force in the industry, representing over 36.3% of the total revenue. The growing adoption of plastics as substitutes for metals in various vehicle parts, including bumpers, lighting, and door assemblies, has fueled the demand for plastics. The use of plastics in these applications reduces the risk of injury in case of accidents, as these materials act as energy absorbers. Moreover, plastics aid in weight reduction, enhance vehicle aesthetics, and provide the necessary strength. Conversely, interior parts primarily serve a decorative purpose, transforming the vehicle's interior into a visually appealing and comfortable space. Plastics offer desirable physical and electrical properties, such as heat resistance, chemical resistance, and abrasion resistance, which are significant drivers of this segment's growth. Traditionally, under-the-hood components were predominantly made of metals, but plastics are gradually replacing them due to their weight-saving benefits.

Regional Insights

The market share of the Asia Pacific region reached 53.8% in the previous year. The electric vehicle market in China is experiencing significant growth. According to the International Energy Agency (IEA), sales in China tripled compared to the previous year, reaching 6.4 million units after a period of stagnation. Europe also saw substantial growth, with a year-on-year increase of two-thirds, resulting in 3.7 million units sold. The demand for plastics from the Battery Electric Vehicle (BEV) segment in China is expected to remain strong throughout the forecast period due to their popularity and zero-emission characteristics compared to Plug-in Hybrid Electric Vehicles (PHEVs). Moreover, investments from companies like Tesla in China are expected to further drive the demand for electric vehicles and, consequently, plastic components. In India, the government is actively promoting the deployment of EV charging stations by offering capital subsidies through the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME) India Scheme Phase II, as well as state-level initiatives. The government has also deregulated the establishment of EV charging stations to attract private sector investments and facilitate market adoption. Japan exhibits higher demand for PHEVs compared to BEVs due to tax exemptions on automobile acquisition and tonnage taxes, leading to a shift in consumer preference. This preference for PHEVs is expected to create favorable growth opportunities for EV plastic component manufacturers in Japan. Europe accounted for a significant revenue share in the previous year. Chemical companies in the region are actively manufacturing plastics for EVs on a large scale. Tax exemptions, subsidies, and supportive policies are stimulating the EV market in Europe, thereby driving the demand for EV plastics over the forecast period. Volkswagen, a global automotive manufacturer, plans to invest USD 7.7 billion in adding 27 new EVs to its existing electric vehicle portfolio in North America. The company expects electric vehicles to comprise 65% of its vehicle sales in the U.S. in the coming years. South America, particularly Brazil and Argentina, is gradually adopting electric vehicles. The demand for EV plastics in this region is currently lower compared to Europe and North America, but as electric vehicle adoption increases, there will be a corresponding growth in the demand for EV plastics, driven by the need for lightweight and durable materials in vehicle manufacturing. As of the knowledge cutoff, electric vehicle adoption in Africa was relatively low compared to other regions. However, countries like South Africa and Morocco have shown interest in promoting electric vehicles and establishing charging infrastructure. The market for EV plastics in Africa is still in its early stages, and specific statistics for the region may be limited.

Dominating Companies in Electric Vehicle Plastics Market

• BASF SE
• LYONDELLBASELL INDUSTRIES HOLDINGS B.V.
• SABIC
• DOW
• DUPONT
• COVESTRO
• SOLVAY
• LANXESS
• LG CHEM
• ASAHI KASEI CORPORATION
• EVONIK INDUSTRIES
• ARKEMA
• INEOS
• SUMITOMO CHEMICAL CO., LTD.
• UBE CORPORATION
• AGC CHEMICALS
• MITSUBISHI ENGINEERING-PLASTICS CORPORATION
• CELANESE CORPORATION
• FORMOSA PLASTICS CORPORATION
• EMS-CHEMIE HOLDING AG
• Denka Company Limited
• DSM N.V.
• Eastman Chemical Company
• JSR Corporation
• Kuraray Co., Ltd.
• Mitsui Chemicals, Inc.
• Polyplastics Co., Ltd.
• Teijin Limited
• Toray Industries, Inc.
• Tosoh Corporation

Recent Developments in Electric Vehicle Plastics Market

• In January 2021, Celanese Corporation, a global chemical and specialty materials company, announced the acquisition of Nilit Plastics, a leading manufacturer of engineered polymers and compounds. This strategic acquisition strengthened Celanese's position in the electric vehicle plastics market, allowing them to offer a wider range of high-performance materials for EV applications.
• In October 2020, Mitsui Chemicals, a Japanese chemical company, acquired the electrical and electronic materials business of Heraeus Holding GmbH. This acquisition expanded Mitsui Chemicals' portfolio of materials for electric vehicle components, including plastics, adhesives, and coatings, enabling them to provide comprehensive solutions to EV manufacturers.
• In August 2020, BASF, a global chemical company, announced a partnership with Plug Power, a leading provider of hydrogen fuel cell systems. The collaboration aimed to jointly develop innovative materials and components for fuel cell applications in electric vehicles. By leveraging BASF's expertise in materials science and Plug Power's fuel cell technology, the partnership aimed to accelerate the adoption of hydrogen fuel cells in the automotive industry.
• In February 2020, Covestro, a leading supplier of high-performance polymers, acquired DSM's Resins & Functional Materials business. This acquisition expanded Covestro's product portfolio for electric vehicle applications, including lightweight plastics, adhesives, and coatings. The combined expertise and resources of both companies positioned Covestro as a key player in providing sustainable and high-performance materials for EV manufacturers.
• In July 2019, SABIC, a global petrochemical company, announced a joint venture with ExxonMobil, named Gulf Coast Growth Ventures (GCGV). The joint venture aimed to construct a new petrochemical complex in the United States, focusing on the production of materials for various industries, including electric vehicles. The project underscored the commitment of both companies to meet the growing demand for innovative plastics and materials in the EV sector.
• In June 2019, DSM, a global science-based company, announced the acquisition of Clariant's 3D printing business. This strategic move strengthened DSM's position in the additive manufacturing industry, including applications in the electric vehicle sector. The acquisition enabled DSM to enhance its portfolio of high-performance materials for 3D printing, including plastics suitable for EV components.
• In November 2018, LyondellBasell, one of the largest plastics, chemicals, and refining companies, announced the acquisition of A. Schulman, a leading supplier of high-performance plastic compounds. This acquisition expanded LyondellBasell's portfolio of specialty plastics, including materials specifically designed for electric vehicle applications. The company aimed to meet the increasing demand for lightweight and sustainable materials in the EV industry.
• In September 2018, Covestro partnered with the Chinese electric vehicle manufacturer, NIO, to develop innovative materials for NIO's electric vehicles. The collaboration focused on utilizing Covestro's expertise in high-performance plastics to enhance the safety, performance, and sustainability of NIO's electric vehicles. The partnership aimed to drive advancements in EV materials technology and support NIO's growth in the Chinese market.
• In April 2018, Mitsui Chemicals entered into a joint venture with Prime Polymer, a subsidiary of Mitsubishi Chemical Holdings, to manufacture and sell polypropylene compounds. This joint venture aimed to meet the growing demand for lightweight plastics in electric vehicle applications. By combining their resources and expertise, the companies aimed to develop and supply high-quality polypropylene compounds for various automotive components, including those used in electric vehicles.

Electric vehicle plastics play a pivotal role in revolutionizing the automotive industry by enhancing sustainability, performance, and safety. The use of lightweight and recyclable plastics helps reduce vehicle weight, improve energy efficiency, and extend battery range. Government policies supporting recycling initiatives and the development of sustainable plastics further accelerate the transition towards greener transportation.