Turbo Charged Engines to drive ACM demand?
ACM is used in automotive applications such as hoses, seals, gaskets, dampers and constant velocity joints (CVJ). Other applications include electrical transmission seals, industrial hoses and adhesives. ACM is cost competitive rubber with slightly lower performance than its immediate competitor AEM (Ethylene Acrylate Elastomer). Hence, it can be used where the performance can be compromised to achieve better economy. Other high-end competitors include flouroelastomers (FKM and FFKM) and Silicone rubber (VMQ). New grade of ACM such as Noxtite HT-ACM by Unimatec Chemicals is more competitive where high temperature performance is required such as turbo-engine hoses. The use of AEM in turbo-engine hoses is driving its demand. Similarly, OEM manufacturers are adopting ACM or mixtures of ACM & AEM for automotive hoses. This generally drives the ACM demand worldwide in turbocharged engines. Currently around 70% of global turbocharged engines are being produced in Europe followed by Asia Pacific accounting for almost 30%, dominated by Japanese turbo-engine manufacturers. The major potential lies in Asia where China has not fully adopted turbocharged engines due to subsidised gasoline prices and continuously changing environmental regulations. The local ACM producers in China have technological challenges to overcome for a better and sustainable product which can compete with world class ACM manufacturers such as Zeon Corporation and Unimatec Chemicals.
Western Europe ACM Demand Analysis
Western Europe is one of the largest consumers of engineering thermoplastics. Germany is the largest producer and consumer of plastics with well-established automotive industry. In terms of ACM consumption, the region ranks second after Asia-Pacific with a demand of around 9 kilotons and automotive is single biggest end-user industry. Brexit is likely to have an impact on the automotive sector as well as OEM’s in Europe as it will impact tariffs, currency and labor cost.
UK has strong growth in terms of automotive manufacturing since past few years but it is likely to be affected by country’s departure from the EU. UK exports around 70% of its car production volume, out of which around 60% is exported to EU countries. Germany and UK witnessed a slight decline in their automotive production in 2017 mainly because of the peak achieved in 2016 and on account of political uncertainties. Despite these factors, the growth for ACM rubber is projected at steady rate of 3.5% during the forecast period 2018-2025.
For a detailed supply-demand analysis report contact Prismane Consulting at email@example.com
Prismane Consulting is a unique global boutique consulting firm with an Indian origin. We present ourselves to the world outside providing management, economic and technical expertise to improve customer engagement, boost operational efficiency, reduce costs and achieve superior business results. Prismane Consulting serves leading businesses in the field of Chemicals, Petrochemicals, Polymers, Materials, Environment and Energy. We have been advising clients on their key strategic issues solving their toughest and most critical business problems.
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