PP Consumption Potential in Automobile Industry
Preface: Polypropylene (PP) materials are widely used in many industries, and the research on the demand field of PP can be carried out from a meso perspective. This article analyzes the demand for PP from the perspective of automobiles. In the future, the automobile industry will gradually develop towards lightweight and energy-saving, and there may be stimulus policies, which will promote the PP demand to advance.
The automobile is an important consumption field of PP copolymer injection molding and plays an important role in PP downstream demand as well. In addition to a small number of parts processed with pure PP resin, most of the automobile parts are processed with modified PP materials. The modified PP is used in many functional fields of automobiles. Therein, modified PP copolymer injection molding is mainly used in automobile bumpers, dashboards, steering wheels, door panels, etc.
In recent years, the automobile industry has shown more demand for plastics and higher requirements for plastic quality, under the background of automobile lightweight and energy-saving demand, which led to continuous growth of plastic consumption in the automobile field. Automobile-used plastic raw materials include PP, PA, ABS, POM, PU, etc., while PP is consumed most. PP materials have advantages in environmental protection and low cost. At the same time, with the improvement in performance and quality of PP after modification, the consumption of PP in the automobile field has been taking a larger proportion in recent years. According to the feedback of a large-scale PP modification enterprise in China, the proportion of PP consumption can reach more than 50% in a passenger car, rising by 15% from previous years. That suggests the consumption growth potential of PP in the automobile industry. According to SCI, the PP demand volume in the automobile industry was around 2.02 million mt in 2022.
First, the demand for PP in China’s domestic automobile industry comes from automobile parts brought by the maintenance of existing automobiles. In 2022, China’s domestic car parc has reached 319 million. In the future, the demand for PP from automobile parts should not be underestimated. Second, the demand for PP comes from the increment in automobile numbers. Especially, the lightweight of automobiles will continue to facilitate the growth of PP consumption.
In terms of automobile industry development, the output and sales growth of automobiles were recovered from 2021 to 2022. On the one hand, with the development of science and technology, the automobile industry made a breakthrough in technology, and the overall potential remained. On the other hand, the large increase in new energy automobiles drove the automobile output to keep growing.
Due to the national strategic support for new energy automobiles, the industrialization of new energy automobiles is continuing to advance. Statistics showed that China’s new energy automobile output notably rose from 2021, with a 97% growth rate in 2022 Y-O-Y. The output proportion of new energy automobiles in passenger automobiles climbed from 4.37% in 2018 to 26.12% in 2022. From January to July of 2023, the output and sales of new energy automobiles reached 4.591 million and 4.526 million respectively, up 40% and 41.7% Y-O-Y. Although the growth slowed down, the proportion of new energy automobiles in overall automobiles rose to over 30%. Compared with traditional gasoline-powered automobiles, new energy automobiles have higher demand for lightweight. Related data revealed that new energy automobiles have more power and potential to be lightweight. Every 100kg mass a new energy automobile reduces, 10% of cruising range will improve. More market shares of new energy automobiles can promote the automobiles’ lightweight development and PP demand advancement.
Furthermore, China’s automobile exports have continued to grow quickly since 2022, with the rise and development of domestic independent brand automobiles. That lent prominent support to automobile consumption. According to relevant data, the export volume of automobiles reached 3.4 million in 2022, up above 55% Y-O-Y. Therein, the new energy automobile played a crucial role in the export market, with an export growth rate of 91.8% in 2022. This growth rate stayed high, despite a decrease. From January to July, China’s export volume of automobiles increased by 74% Y-O-Y, and that of new energy automobiles climbed 1.5 times to 636,000. The high growth rate of automobile exports drove up the enthusiasm of automobile manufacturers, which further stimulated the demand for PP.
According to SCI, automobile-used PP plastic consumption accounts for 7% of the total demand for PP at present. In recent years, PP consumption in the automobile industry has occupied a stable proportion with overall PP demand growing, although the PP consumption proportion in plastic woven and BOPP film fields kept dropping. In the future, automobile-used PP consumption will probably witness a rapidly increasing proportion of the total with the development of new energy automobiles and the continuous advancement of lightweight. In a word, the automobile industry will become a more prominent downstream consumption field of PP in the future.
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