Northbrook, IL 60062 -- (SBWIRE) -- 04/22/2022 -- The Automotive Fuel Tank Market is estimated to be USD 16.6 billion in 2021 and is projected to reach USD 21.3 billion units by 2026, at a CAGR of 5.1%. The key growth drivers for the market are the need for lightweight vehicles for achieving zero greenhouse gas emissions, better fuel efficiency, longer driving range, and continuous investments and R&D activities by OEMs, fuel tank manufacturers, and governments toward the development of lightweight fuel tanks.

Some of the key players in the fuel tank market for automotive are The Plastic Omnium Group (France), Textron – KautexV (US), Yapp (China), TI Fluid Systems (UK), Yachiyo (Japan), Unipres Corporation (Japan), Magna International (Canada) and FTS - Fuel Total Systems (Japan).

Opportunities: To build economical fuel tanks using lightweight materials

Alternate fuel vehicles that use gaseous materials such as CNG, LNG and hydrogen require strong, safe, and lightweight tanks to maintain normal vehicle size, weight, and driving range. Traditional alternative fuel tanks are made of common grade steel and, over time, the gas can migrate into the metal making the metal brittle causing leakage from the tank. The HDPE plastic fuel tanks are light in weight and are safe to use in vehicles which majorly contribute to reducing the overall weight of the vehicle. The emergence of fuel cell technology is an efficient solution to achieve a high driving range of about 500 km and a lesser refuelling time compared to battery electric vehicles. It is estimated that by 2035, about 5 million vehicles equipped with fuel cell technology could be in production. Carbon fibre composite, which is lighter than other materials, is ideal for hydrogen tanks that need to withstand a high pressure of 700 bars. The benefit of using materials such as carbon fibre composites for alternative fuel tanks is that they keep weight to a minimum while offering high shock resistance and long life. Fuel tanks manufactured with carbon fibre composites present a good opportunity for manufacturers.

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The 45L – 70L tank segment is expected to be the largest growing market during the forecast period.

The automotive fuel tank market is segmented by capacity into three categories: <45 litres, 45 – 70 litres, and >70 litres. Most passenger vehicles, including mini cars, hatchbacks, and mid-sized sedans, have a fuel tank capacity of <45 litres. Many SUVs and luxury cars have tank capacities greater than 70 litres. The sedans and mini SUVs are commonly equipped with fuel tanks of 45 - 70 litres capacity. The growing demand and increased production of sedans and mini SUVs in countries like Japan, China, India, Germany, France, and Spain have estimated the 45 – 70 litres fuel tank segment to be the largest growing market in the coming years. In the US, customers prefer using SUVs as they are suitable for long distances. Also, the growing demand for commercial vehicles in countries like China and Germany is responsible for the fast growth of the >70 litres segment. About 3.6 million heavy-duty vehicles are required to move 10.5 billion tons of freight annually, which in turn would drive the growth of the >70 litres segment.

High-Density Polyethylene is the most widely used material for the automotive fuel tanks market

Plastic fuel tanks are principally produced using High-Density Polyethylene (HDPE). These tanks are lightweight and can be easily moulded according to the requirements of OEMs. The demand for plastic fuel tanks is higher than for metal fuel tanks, resulting in an increased demand for HDPE. Plastic fuel tanks find application in almost every vehicle segment, including passenger cars, LCVs, and HCVs. As of 2020, plastic fuel tanks are estimated to account for the largest share, in terms of both volume and value, of the global automotive fuel tank market. The demand for plastic fuel tanks is primarily driven by increasing vehicle production and the growing trend of vehicle weight reduction, which has been triggered by stringent emission norms. Also, there is an increase in the number of passenger and commercial vehicles in developing countries like India as well as developed countries like Japan.

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The Asia Pacific is expected to lead the market during the forecast period.

In the Asia Pacific, China and Japan account for the largest share of the fuel tank market for automotive. The growth of the market in this region can be attributed to the high vehicle production and increased demand for passenger vehicles in countries such as China, India, Japan, and South Korea. The per capita income of Asian countries has been rising at a steady rate and the governments of these countries have recognized the growth potential of the automotive industry and have consequently taken various initiatives to encourage major OEMs to enter their domestic markets. Several European and American automobile manufacturers such as Volkswagen (Germany), and Mercedes Benz (Germany) have shifted their production plants to developing countries in the region. The manufacturing and production of vehicles are growing at a fast pace due to FDIs coming to countries like Thailand, Indonesia, and India. The Chinese market is likely to increase the adoption of HDPE plastic fuel tanks due to their lightweight and reduced emission features in the near future marking the largest share in the Asia Pacific region followed by Japan and South Korea. Countries like China and India being the leading two-wheeler manufacturers in the world drive the demand for fuel tanks.