A Staggering CAGR Projected for Autoclaved Aerated Concrete (AAC) Market During 2016 - 2024

The autoclaved aerated concrete market in Europe and Asia Pacific is highly competitive owing to the presence of a large number of AAC manufacturers, observes a recent report by Transparency Market Research. On the other hand, the North America market features a low level of competition owing to the limited number of players due to subdued demand. Strong regional presence of companies such as Xella Group, H+H International, SOLBET, ACICO, AERCON AAC, and UltraTech Cement Ltd. have allowed them lead the market’s competitive scenario.

Transparency Market Research estimates that in terms of revenue, the global market for autoclaved aerated concrete (AAC) was valued at US$6.11 bn in 2015. The market is expected to exhibit a 7.3% CAGR between 2016 and 2024, owing to which, it will rise to a valuation of US$11.44 bn by 2024. In terms of product variety, the segment of AAC blocks dominated the global market with a 48.78% of the market in 2015. Geographically, Europe dominated, holding more than 34% of the global market in 2015.

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Reinforcement of Environment Protection Laws Prompt Construction Companies to Adopt AAC

AAC has gained an increasing level of popularity in the global market owing to the heightened focus on environment-friendly construction materials. Production of AAC is energy-efficient and the material is chemically inert, nontoxic, and weighs only about one-fourth the weight of conventional concrete. Owing to these factors, AAC has become one of the primary choices of the construction industry for developing green building projects. The low weight of AAC structures leads to a significant reduction on the materials’ cost of transportation. Moreover, AAC makes excellent use of fly ash (approximately 60% by weight of a typical AAC product), many million tons of which are produced every year by the thermal power generation industry.

Owing to these factors, AAC blocks are increasingly replacing traditional red bricks across the globe. Compared to the process of manufacturing of red bricks, which is highly taxing to the environment as it consumes fertile land and emits greenhouse gases, AAC has a significantly low level of negative impact on the environment. The factor is expected to remain one of the key growth drivers of the global AAC market in the next few years. With environment protection amendments and rules becoming stricter with every passing day, AAC will garner a central position in the global market in the near future.

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High Cost of AAC Products Limits Consumption in Developing Economies

The selling price of AAC products such as blocks is relatively much higher as compared to conventional substitutes such as burnt clay or red bricks. Owing to this, the segment of clay bricks accounts for over 90% of the overall volume of walling materials consumed across the globe every year. The consumption of AAC structures is much higher in developed economies across Europe and North America as compared to developing ones across Asia Pacific and Latin America.

In Europe, especially, there are over 100 AAC manufacturing facilities, which produce around 21

mn cubic meter of AAC every year. AAC accounts for more than 40% of the construction industry in the U.K. and more than 60% in Germany. In developing economies such as China and India, which are considered some of the most lucrative countries for the construction industry in the present scenario, the usage of AAC is presently low. The consumer in these countries is highly cost-sensitive. Owing to the fear of losing potential consumers, the construction industry in these countries shies away from making the move to this environmentally much viable but also a much costlier construction material.

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This release was published on openPR.