Thermoplastic Elastomers Market

Thermoplastic elastomers (TPEs) are a type of polymer material that combines the flexibility and durability of rubber with the processability and recyclability of thermoplastics. TPEs are a popular choice in various applications because of their unique characteristics, including their ability to be molded or shaped into various forms, their resistance to chemicals, and their low-temperature flexibility.

TPEs are generally composed of three main components: a hard segment, a soft segment, and a midblock that connects the two segments. The hard segment provides the material with strength and stiffness, while the soft segment provides flexibility and elasticity. The midblock acts as a bridge between the hard and soft segments, allowing the material to maintain its structure and properties.

There are several types of TPEs, including styrenic block copolymers (SBCs), thermoplastic polyurethanes (TPUs), thermoplastic vulcanizates (TPVs), and copolyester elastomers (COPEs). Each type has its unique properties and characteristics, making them suitable for different applications.

SBCs are one of the most commonly used TPEs and are composed of styrene and butadiene. They are known for their excellent flexibility, low-temperature resistance, and good processability. TPUs, on the other hand, are composed of polyurethane and are known for their high abrasion resistance, tear strength, and flexibility. TPVs are a blend of a thermoplastic and a cross-linked elastomer and are known for their good weather resistance, high-temperature stability, and oil resistance. COPEs are composed of polyester and polyether segments and are known for their good chemical resistance and high-temperature stability.

TPEs are used in a variety of applications, including automotive, construction, medical, and consumer products. In the automotive industry, TPEs are used for weather sealing, gaskets, and interior trim components. In the construction industry, TPEs are used for roofing membranes, window profiles, and cable sheathing. In the medical industry, TPEs are used for tubing, seals, and stoppers. In the consumer products industry, TPEs are used for toys, sports equipment, and household items.

Thermoplastic Elastomers Market Dynamics

Drivers in Thermoplastic Elastomers Market

The thermoplastic elastomers market dynamics are primarily driven by the recovery of the automotive sector and the rising penetration of electric vehicles (EVs). The automotive industry has been facing declining sales, changing regulatory scenarios, and a shift in consumer preferences towards EVs. The COVID-19 pandemic further exacerbated the situation by leading to a suspension of production operations and a decline in demand.

The continuous technological developments in the automotive sector, particularly in Asian countries like China, India, Japan, and South Asia, are expected to drive the demand for thermoplastic elastomers. Automotive vehicle manufacturers are focused on reducing vehicle weight by replacing metal parts such as iron and steel components with lightweight high-performance elastomers to improve fuel economy, vehicle performance, and reduce CO2 emissions. Therefore, with the growth of the automotive industry worldwide, the demand for thermoplastic elastomers is expected to increase during the forecast period.

Thermoplastic elastomers offer several high-performance characteristics in EVs as compared to traditional metals, thermoset rubbers, and other materials. The changing regulatory scenario and government policies supporting EVs further boost the thermoplastic elastomers market. The increasing consumer preference for high-performance and lightweight passenger cars has also led to increased thermoplastics consumption in automotive manufacturing.

Thermoplastic elastomers exhibit superior physical and chemical properties compared to thermoset plastics, thereby gaining preference in terms of application. They are also eco-friendly, recyclable, and can be re-molded and re-shaped, which eliminates wastage extensively. They offer various other advantages, including resistance to chemicals, UV, and oxidation, and provide soft-touch to materials. These properties are driving the replacement of rubber and conventional plastic materials by TPEs in their respective applications. Additionally, several federal bodies regulate TPE utilization for commercial applications, providing guidelines for prudent product usage to ensure utmost consumer health and safety.

Restraints in Thermoplastic Elastomers Market

Thermoplastic elastomers (TPEs) have a higher production cost and complex manufacturing process compared to other materials such as PVC, rubbers, polyethylene, and polyurethane. The process requires high-temperature devices and technical expertise, making it a capital-intensive production process that limits its use in high-end applications. Other materials such as compounding grades of polyethylene, polypropylene, acrylonitrile butadiene styrene, and polyurethane are cheaper alternatives to TPEs, and their properties can be developed to be similar to TPEs. As a result, TPEs are mainly used in industries such as industrial machinery, building & construction, and electronics, where they face competition from these cheaper alternatives.

The price of TPEs is also impacted by the fluctuating prices of raw materials, which are mostly derived from crude oil. The increase in crude oil prices due to the OPEC+ strategy and the Russia-Ukraine war has led to an increase in the prices of raw materials worldwide. This has adversely affected the profit margins of TPE products. Moreover, the U.S. Environment Protection Agency has set guidelines regarding carbon emissions from automotive vehicles, creating a corresponding demand for fuel-efficient cars and industrial machinery made from TPE components.

The demand for TPEs is projected to increase further due to the rapidly developing automobile markets. TPEs are expected to be used in interiors, exteriors, sealing systems, and underhood components, creating new opportunities for TPE manufacturers.

Opportunities in Thermoplastic Elastomers Market

The market for biobased thermoplastic elastomers is rapidly emerging, with the material being developed from renewable resources like vegetable oils and fatty acids. These elastomers are providing equivalent or even better properties than traditional ones, making them an ideal material for industries such as electronics, sporting goods, and footwear. The use of biobased thermoplastic elastomers reduces the consumption of non-renewable resources and promotes biodegradability. As a result, manufacturers are innovating and commercializing biobased thermoplastic elastomers, creating new opportunities for the industry.

Many synthetic thermoplastic elastomer manufacturers, such as BASF and Lubrizol, have shifted their focus towards developing sustainable and eco-friendly products. They have started producing biobased thermoplastic elastomers for various industries such as footwear, automotive, industrial, electronics, and textiles. Biopolymers like corn starch, wheat starch, poly hydroxybutyrate (PHB), polylactide (PLA), castor oil, and palm oil are used to manufacture biobased thermoplastic elastomers. R&D for the manufacturing of biobased thermoplastic elastomers is creating an opportunity for manufacturers.

TPE is a lightweight material that is widely used in the automotive industry to increase fuel efficiency by reducing car weight and density. Regulatory bodies across various nations have imposed strict regulations to reduce the impact of carbon emissions and greenhouse gases on the environment and human health. The rapidly developing automobile markets are projected to boost TPE demand in exterior, interiors, sealing systems, and under-the-hood components. This increased application in the automotive industry is spurred by demand for safe, lightweight, and inexpensive MUV/SUV models with high fuel efficiency and emphasis on comfort and aesthetics.

Wearable electronics present opportunities for added connectivity, enhanced productivity, and enriched lifestyles. Thermoplastic elastomers offer superior performance qualities such as cleanliness, shock absorption, flexibility, weather, chemical, and thermal resistance, easy sterilization, and dimensional stability. As consumers become more aware of these advantages, the demand for thermoplastic elastomers is expected to grow. Additionally, the eco-friendliness, cheap energy costs in production, and ease of molding, processing, and recycling are making thermoplastic elastomers more popular, which will bolster the market growth.

The rising construction activities and infrastructural development operations will further propel the growth rate of the thermoplastic elastomers market. The increasing usage of thermoplastic elastomers in electric vehicles will drive the market value growth. Rapid urbanization around the world, combined with rising consumer disposable income, has resulted in exponential growth of the vehicle industry, which in turn has fueled the growth of the thermoplastic elastomers market.

Challenges in Thermoplastic Elastomers Market

The thermoplastic elastomer market faces a challenge in the intra-segment replacement of different types of thermoplastic elastomers. With various types of thermoplastic elastomers available in the market, the selection process can be complex, leading to a rise in the trend of simplifying the process by focusing on specific types that can perform multiple functions, resulting in decreased demand for other thermoplastic elastomers. This trend is evident in the automotive industry where thermoplastic elastomers replace costlier and heavier thermoplastic vulcanizates, such as the expected replacement of thermoplastic polyolefin with PVC and thermoplastic polyurethane films in automotive applications in the forecast period. This replacement in the intra-thermoplastic elastomer segment poses a challenge to the overall market's growth.

The market has seen growth in the development of unique wearable and miniaturized electronics, where manufacturers are integrating lightweight and sustainable materials like TPE to provide a soft-touch feel of advanced materials into high-end consumer gadgets.

The increasing expenditure on healthcare and medical facilities is expected to drive investments in medical devices and products that use lightweight plastic materials such as TPE for packaging and other applications, promoting weight savings in transportation and allowing hygienic protection of the inner contents.

Various polymers are used to prepare thermoplastic elastomers depending on the desired end-product. For example, TPE-S is a two-block copolymer with SBS rubber as the base element, TPO is a blend of polypropylene and un-crosslinked EPDM rubber, while TPV is made of the same compounds with additional dynamic vulcanization.

Ecosystem of Thermoplastic Elastomers Market

The automotive industry accounted for the largest share in the thermoplastic elastomers market in 2021 in terms of value. This is due to the use of thermoplastic elastomers in several exterior body parts such as body seals, exterior filler panels, wipers, automotive gaskets, door & window handles, rocker panels, and vibration damping pads. The competition between market players to provide lightweight vehicles, development of transportation infrastructure, supportive government policies, robust auto parts, and rapid economic growth are projected to increase the thermoplastic elastomers market in the automotive industry.

Thermoplastic polyolefin accounted for the largest share in the thermoplastic elastomers market in 2021 in terms of type. This material is manufactured using techniques such as injection molding, profile extrusion, thermoforming, and blow molding. It provides weather-resistant quality and is non-degradable on exposure to solar radiation, making it ideal for outdoor applications such as roofs, geomembrane insulation, and corrosion protection of oil and gas pipelines.

In terms of volume, Styrene Block Copolymer accounted for the largest share of the thermoplastic elastomer market. These high-performance elastomers improve performance in several applications and are used to replace ethylene propylene diene monomer (EPDM) and ethylene-propylene (EP) rubber in various end-use industries. Poly styrenes held the largest revenue share of over 39% in 2023, with increasing demand for SIS, particularly in China and India, expected to drive segment growth over the next eight years.

The global consumption of TPE is expected to increase due to its growing prominence in construction applications owing to its thermal and acoustic insulation properties. The importance of energy efficiency in buildings and subsequent regulatory policies aimed at zero-energy buildings are expected to drive TPU demand in construction over the next eight years. Additionally, the increasing consumption of TPE in automotive under-the-hood applications and fascia systems is expected to be a major factor driving the global TPE consumption.

During the forecast period, the Asia Pacific region is expected to account for the largest share of the thermoplastic elastomers market. The growth of the construction sector and the automotive industry are the main drivers of demand for thermoplastic elastomers in this region. China dominates the market, followed by Japan and South Korea, making Asia Pacific the largest market for thermoplastic elastomers in 2021. Furthermore, this region is projected to register a high compound annual growth rate (CAGR) during the forecast period.

The automotive segment holds the largest revenue share of over 43% in 2023. The usage of thermoplastic elastomers in the automotive industry has increased significantly, especially for electronic and electrical devices such as electric motor housings, seating and window mechanisms, passenger airbags, and safety belt tensioners. Under-the-hood components also utilize newly developed grades with enhanced hydrolytic stability.

Moreover, the electrical and electronics segment emerged as the second-largest segment in 2021. Manufacturers are utilizing compounds with electrical insulation properties and inherent high heat distortion temperatures for components such as circuit breakers, switches, connectors, and housings in the home appliance market. The telecommunications and IT sectors also use these polymers in mobile phone casings to lower weight and foster miniaturization. Advancements in injection molding and similar techniques are driving the demand for stronger grades in the sector.

Overall, the Asia Pacific region's dominance in the thermoplastic elastomers market is due to the high demand from the construction and automotive industries, as well as the increasing adoption of these materials in various electrical and electronic applications.

The global thermoplastic elastomers market has witnessed several developments in recent years. One of the major developments is the increasing demand for thermoplastic elastomers in various industries such as automotive, building & construction, and electronics. The automotive industry, in particular, has been a major contributor to the growth of the thermoplastic elastomers market due to the increasing demand for lightweight and fuel-efficient vehicles. Thermoplastic elastomers are widely used in exterior body parts, such as body seals, wipers, gaskets, and vibration damping pads, among others.

Another significant development in the thermoplastic elastomers market is the increasing focus on sustainable and eco-friendly products. Manufacturers are investing heavily in the development of bio-based thermoplastic elastomers that are derived from renewable sources such as vegetable oils and starch. These bio-based thermoplastic elastomers are gaining popularity in various industries due to their eco-friendly and biodegradable nature.

The market is also witnessing increasing demand for thermoplastic elastomers with advanced properties such as improved strength, durability, and resistance to heat and chemicals. To meet these demands, manufacturers are investing in research and development activities to develop advanced thermoplastic elastomers that can meet the specific needs of various end-use industries.

Dominating Companies in Thermoplastic Elastomers Market

• ARKEMA S.A.
• ASAHI KASEI CORPORATION
• BASF SE
• THE DOW CHEMICAL COMPANY
• COVESTRO AG
• HUNTSMAN CORPORATION
• EXXONMOBIL CORPORATION
• MITSUBISHI CHEMICAL HOLDINGS CORPORATION
• LUBRIZOL CORPORATION
• DUPONT DE NEMOURS, INC.
• SIBUR
• DYNASOL ELASTOMERS
• CELANESE CORPORATION
• ZEON CORPORATION
• LYONDELLBASELL INDUSTRIES N.V.
• ELASTRON
• ALPHAGARY LIMITED
• WASHINGTON PENN
• HEXPOL AB
• NOBLE POLYMERS
• TEKNOR APEX COMPANY
• GAF

Recent Developments in Thermoplastic Elastomers Market

In February 2020, Tekni-Plex, a leading manufacturer of medical, pharmaceutical, and food packaging products, acquired Lameplast, an Italian manufacturer of plastic single-dose packaging for pharmaceutical and cosmetic applications. The acquisition is expected to enhance Tekni-Plex's portfolio of medical and pharmaceutical packaging products, including thermoplastic elastomer-based films and pouches.

In July 2019, US-based Teknor Apex Company, a global provider of engineering thermoplastics, acquired German-based Plastic-Technologie-Service (PTS), a leading supplier of custom-compounded thermoplastic elastomers. The acquisition is expected to strengthen Teknor Apex's position in the European market for thermoplastic elastomers.

In April 2019, Hexpol AB, a Swedish polymer compounding company, announced the acquisition of Kirkhill Rubber Company, a US-based manufacturer of high-performance rubber and silicone products. The acquisition is expected to enhance Hexpol's product portfolio, which includes thermoplastic elastomers, rubber compounds, and specialty polymers.

In October 2018, ExxonMobil Chemical Company, a subsidiary of ExxonMobil Corporation, announced a partnership with Clariant, a Swiss specialty chemical company, to develop new high-performance polymers. The partnership is focused on developing new compounds and additives, including thermoplastic elastomers, for use in automotive, electrical, and electronics applications.

In September 2018, PolyOne Corporation, a global provider of polymer materials and services, announced the acquisition of PlastiComp, a leading manufacturer of long fiber thermoplastic composites. The acquisition is expected to enhance PolyOne's portfolio of specialty polymer formulations, including thermoplastic elastomers, and expand its presence in the automotive and other high-performance markets.

In February 2022, Teknor Apex Company, a leading manufacturer of thermoplastic elastomers and other plastic compounds, announced that it had acquired Thermoplastic Vulcanizate (TPV) business from ExxonMobil Chemical Company. This acquisition has strengthened Teknor Apex's position in the TPV market and expanded its portfolio of TPE products.

In July 2021, Ravago Manufacturing, a leading distributor and compounder of plastic and rubber materials, announced that it had acquired Polymer Partners, LLC, a manufacturer of custom thermoplastic elastomer compounds. This acquisition has expanded Ravago's portfolio of TPE products and strengthened its position in the North American market.

In November 2020, Trinseo, a global materials solutions provider and manufacturer of TPEs, announced that it had entered into a partnership with AdvanSource Biomaterials Corporation, a developer of advanced polymer materials for medical devices. This partnership has focused on developing new TPE-based medical device solutions that offer improved safety and performance.

In September 2019, Kuraray Co., Ltd., a Japanese specialty chemical company, announced that it had acquired the TPE business of German company, Lotte Chemical Deutschland GmbH. This acquisition has expanded Kuraray's global footprint in the TPE market and strengthened its position in Europe.

In March 2019, Celanese Corporation, a global chemical and specialty materials company, announced that it had acquired the TPE compounder, Next Polymers Ltd., based in India. This acquisition has expanded Celanese's TPE product offerings and strengthened its position in the Asia-Pacific market.

In conclusion, TPEs are a versatile and popular material used in a wide range of applications because of their unique properties and characteristics. As technology continues to advance, the use of TPEs is expected to grow, and new applications and uses will continue to emerge.