Composite Material Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Composite Material Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Composite Material Market is projected to register a CAGR of over 5% during the forecast period (2021-2026).

The market was negatively affected due to COVID-19 in 2020. Owing to pandemic scenario, several countries around the world went into lockdown to curb the spreading of virus. Manufacturing activities and construction work were halted due to supply chain disruptions and labour shortages or as a protective measure to stop the spread of virus, thereby negatively affecting the market. However, the conditions are expected to recover in 2021, which will restore the growth trajectory of the market studied, further benefitting the market over the forecast period.

Key Highlights

• Over the short term, technological advancements in the field of material science and increasing use of composites in aerospace and defense industry are driving the market growth.
• On the flipside, negative impact of COVID-19 pandemic and high cost of composite materials are hindering the growth of the market studied.
• North America accounts for the largest market share and Asia-Pacific is expected to register highest growth rate during the forecast period.
• Among the applications, aerospace & defense application dominated the market studied and is expected to dominate the market studied during the forecast period.

Key Market TrendsCarbon Fiber Type to Witness the Highest Growth

• Over the past years there have been a number of changes in the application areas for carbon fiber. Aerospace & defense applications have grown significantly and are now the largest consumers of carbon fiber.
• At present, the aerospace and defense industry are in a “supercycle”, mainly due to huge order backlogs, which may drive production in the industry over the next decade, thus increasing the demand for carbon fiber over the forecast period.
• According to Boeing Commercial Market Outlook 2020–2039, 43,110 aircrafts are expected to be delivered during 2020-2039. Of this regional flight deliveries are 2,430 units, single aisle are 32,270 units, widebody aircrafts at 7,480 units, and 930 freighter deliveries.
• The automotive segment is becoming increasingly obsessive with consumption of carbon fiber and has increased significantly over the past years. This is mainly because of the factors relating to the reduction of CO2 emissions, lightweight construction and e-mobility.
• Despite an encouraging term of growth in the automotive sector during the past decade, the momentum slowed down in recent years. The sales and production of new vehicles are going down in various parts of the world, including Europe, Asia-Pacific, and the United States. This affected the previously growing automotive production in most nations. Business models, the markets, and the competitive landscape are undergoing changes.​​ This may affect the demand for carbon fiber in the sector.
• According to the OICA data, the global automotive production declined by around 5% and reached 91.78 million in 2019. ​The production further declined and reached to 77.62 million in 2020. The huge downfall in 2020 was due to the impact of COVID-19.
• However, with growing concerns related to environmental pollution from petrol and diesel-based vehicles, the production of electric vehicles is expected to pick up pace over the next five years. This is likely to drive the demand for carbon fiber type and consequently drive the composite material market over the forecast period.
• According to IEA, in 2030, global electric vehicle sales are expected to reach 125 million as per the New Policies Scenario (excluding two/three-wheelers). In the EV30@30 Scenario, in 2030, around 70% of the vehicle sales in China are expected to be EVs. Also, half of the vehicles sold in Europe are EVs, 37% in Japan, 30% in Canada and the United States, and 29% in India.
• Hence, owing to the above-mentioned factors, carbon fiber is expected to witness the highest growth rate during the forecast period.

Asia-Pacific to Witness the Highest Growth Rate

• Asia-Pacific region accounts for the highest share of composite material market owing to high demand from end-user industries like construction, automotive, electrical & electronics, aerospace & defense, Industrial, etc.
• The demand for composite material in the Asia-Pacific region is growing at a staggering rate as a result of rapid industrialisation in countries such as China, India, and Japan.
• With growing investments and the construction activities in the China, the demand for composite materials is projected to grow during the forecast period. According to the National Bureau of Statistics of China, the revenue generated by the Chinese construction industry has increased from CNY 17.67 trillion in 2014 to CNY 24.84 trillion in 2019.​
• Rising household income levels, combined with population migrating from rural to urban areas, are expected to continue to drive demand for the residential construction sector in the country. ​Increased focus on affordable housing by both the public and private sectors is also driving the growth in the residential construction sector.
• China is investing USD 1.43 trillion in the next five year till 2025, in major construction projects. According to National Development and Reform Commission (NDRC), Shanghai plan includes the investment of USD 38.7 billion in next three years, whereas Guangzhou has signed 16 new infrastructure projects with and investment of USD 8.09 billion.
• The Chinese automotive manufacturing industry is the largest in the world, with a production share of just over 32% in 2020. The industry witnessed a slowdown in 2018, wherein the production and sales declined. A similar trend continued in 2019, with the production declined to 25.7 million vehicles by dropped by about 7.5% year-on-year. Due to COVID-19, the production further reduced to 25.2 million vehicles in 2020. The uncertainties in the automobile industry are expected to impact the market studied.
• The Chinese aerospace policy represents one of the most comprehensive attempts to enter the top levels of aerospace development and production. China is expected to be the world’s largest single‐country market for civil aircraft sales, over the next 20 years.
• According to Boeing, China is estimated to require around 7,600 new commercial aircraft, valued at USD 1.2 trillion, over the next two decades.
• Under the plan ‘Made in China 2025’, it is expected that China is likely to supply over 10% home-made commercial aircraft to the domestic market by 2025. This is expected to provide opportunities for composite materials market in aerospace sector during the forecast period.
• China has the world’s largest electronics production base. Electronic products, such as smartphones, TVs, wires, cables, portable computing devices, gaming systems and other personal electronic devices recorded the highest growth in the electronics segment. The country serves not only domestic demand for electronics, but also exports electronic output to other countries. In China, with the increase in the disposable income of the middle-class population and the rising demand for electronic products countries importing electronic products from China, the production of electronics is projected to grow, thereby benefitting the market studied.
• Beside this, other countries such as India, Vietnam, Singapore, and Japan are also contributing positively to the growth of the studied market.
• Hence, owing to such factors, the Asia-Pacific region is likely to witness the highest growth rate.

Competitive Landscape

The composite material market is moderately fragmented as the market share is divided between many players. Key players in the market include TORAY INDUSTRIES, INC., 3M, Cabot Corporation, Dupont, and Owens Corning, among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

3M
DuPont
DIT B.V.
COMPOSITES UNIVERSAL GROUP
Cabot Corporation
Mitsubishi Chemical Corporation
Owens Corning
TEIJIN LIMITED.
TORAY INDUSTRIES, INC.

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