The Global Aramid Fiber Market size was valued at USD 3,968.97 million in 2020 and the market is projected to register a CAGR of over 4% during the forecast period (2021-2026).
The market was negatively impacted by COVID-19 in 2020. During the pandemic scenario, end-user industries such as automotive, aerospace, and electronics have halted the production temporarily, thus led to a decrease in the demand for products made up of aramid fibers, which in turn negatively impacts the demand for the studied market. According to the International Civil Aviation Organization (ICAO), the overall number of passengers had fallen by 92% globally as of April 2020 when compared with the same months of 2019 and the international traffic had fallen by 98%, thus had decreased the growth of the aerospace industry, which in turn negatively impacts the market demand for aerospace materials like aramid fiber.
- Over the short term, the increase in defense spending by many countries and the growing demand for aramid fiber from the aerospace sector are expected to drive the market's growth.
- On the flipside, the availability of alternatives with better properties such as glass fibers and the negative economic impacts of COVID-19 are projected to hinder the growth of the market studied.
- Europe dominated the global aramid fiber market followed by North America and Asia-Pacific worldwide, with the largest consumption coming from countries, such as Germany, United Kingdom, France, and Italy.
Key Market Trends
Automotive Industry Dominated the Market
- In the automotive industry, aramid fibers are used in the manufacturing of reinforcement materials for tires, turbocharger hoses, powertrain components, belts, brake pads, gaskets, clutches, seat fabrics, electronics, seat sensors, and hybrid motor materials.
- Additionally, the high thermal resistance of aramid fibers makes them ideal for the manufacturing of heat shields and under bonnet applications.
- In recent years, there has been a shift toward lightweight automobiles. Owing to this, car manufacturers are designing lighter vehicles by replacing metal with composites based on aramid fiber, to make them light, tough, and recyclable. The growing demand for lightweight vehicles is favoring the aramid fiber market.
- Aramid fibers find major applications in automobile racing events. They are becoming a major alternative for fiberglass-reinforced plastic in racing automobiles, as they do not shatter and leave debris in case of a crash.
- However, the global automotive industry has witnessed a downfall in recent times. According to the OICA, around 77.62 million vehicles were produced globally in 2020 compared to 92.18 million vehicles that were produced in 2019, witnessing a decreasing growth rate of about 15.8%.
- The decline is majorly attributed to the reduced production in the major automotive hubs such as United States, China, Japan, and Germany. In 2020, these countries witnessed a decline of 19%, 2%, 17% and 24% respectively compared to 2019.
- Therefore, the aforementioned factors are expected to show a significant impact on the market in the coming years.
Germany to Dominate the European Market
- The German economy is the largest in Europe and the fourth-largest in the world. According to the International Monetary Fund (IMF), the percentage change in the real GDP growth of the country was accounted for -4.9% in 2020 and is estimated that there is a +3.6% change in the real GDP in the year 2021.
- Germany leads the European automotive market, with 41 assembly and engine production plants that contribute to one-third of the total automobile production in Europe. Germany, which is one of the leading manufacturing bases of the automotive industry, is home to manufacturers from different segments, such as equipment manufacturers, material and component suppliers, engine producers, and whole system integrators.
- According to the OICA, the total number of cars and light commercial vehicles (LCV) produced in Germany was accounted for about 4.95 million units in 2019 and reached 3.74 million units in 2020, with a decline rate of 24.4%. The country has been witnessing this decline in automotive production over the past few years. This is mainly due to high costs, shifting of the production base to other countries (like China), and introduction of new WLTP emission control regulations (as numerous manufacturers were unable to register their new products).
- Germany, being one of the leading manufacturing bases for the aircraft industry, is home to manufacturers from different segments, such as equipment manufacturers, material and component suppliers, engine producers, and whole system integrators. The Federal Ministry of Economic Affairs and Energy lists aerospace as a key industry in Germany, with a strong industrial core and high growth rates expected to be witnessed in the years to come.
- The German aerospace industry includes more than 2,300 firms, which are located across the country, with northern Germany recording the highest concentration of firms. The country hosts many production bases for aircraft interior components, and materials, largely in Bavaria, Bremen, Baden-Wurttemberg, and Mecklenburg-Vorpommern.
- In Hamburg, Germany, Airbus inaugurated an automated fuselage-structure assembly line for narrow-body aircraft of the A320 family with a new concept for the industrial production network of Airbus in October 2019. This new line is designed to assemble the longer parts for the A321LR and includes 20 robots with a new logistics model, laser-assisted automatic positioning, and digital data. This site is also involved in the manufacturing and equipping of A330 and A350 XWB jetliners family.
- In March 2019, Germany's Lufthansa has ordered 20 new Boeing 787-9 planes and 20 Airbus A350-900s long-haul jets, which will be delivered from late 2022 to 2027.
- Furthermore, in November 2020, Airbus has signed a contract to deliver 38 new Eurofighter aircraft, including 30 single-seater and 8 twin-seater Eurofighters, to the German Air Force.
- All the abovementioned factors, in turn, are projected to show significant impact on the market growth in the coming years.
The global aramid fiber market is highly consolidated, with the top two players. Key companies in the market include TEIJIN LIMITED, DuPont, Yantai Tayho Advanced Materials Co., Ltd., Kolon Industries, Inc., and HYOSUNG, among others.
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