LONDON--(BUSINESS WIRE)--Technavio’s latest report on the global aftermarket for engine oil in passenger cars provides an analysis on the most important trends expected to impact the market outlook from 2016-2020. Technavio defines an emerging trend as a factor that has the potential to significantly impact the market and contribute to its growth or decline.
Praveen Kumar, a lead analyst from Technavio, specializing in research on automotive services sector, says, “The consumption of engine oil in passenger cars in the Americas is more since it has many vehicles and the number of cars per population is comparatively higher than in other regions. Full-size vehicles such as pickup trucks, minivans, and SUVs are more popular in this region.”
Full-size vehicles have larger engine capacity and consume more engine oils than the compact- and mid-size vehicles. The average miles driven per year in the Americas is also high with respect to other regions as people here depend a lot on their own vehicles to travel from one city to another and to commute inside the city. Public transport such as the use of railways as transportation is low as it does not provide end-to-end connectivity.
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The top three emerging trends driving the global aftermarket for engine oil in passenger cars according to Technavio automotive research analysts are:
- Rise in road tourism in India and China
- Growing use of synthetic oils in APAC
- Increase in average vehicle miles driven
Rise in road tourism in India and China
Road tripping tourism in China is leading to increase in the average miles driven, directly influencing the consumption of engine oils. In China, Guiyang in Guizhou province and Dali and Lijiang in Yunnan province are reported to be the most preferred spots for road tourism. Chinese travelers are estimated to have made about 4 billion visits within the country in 2015. Out of which, more than 3 billion tourists traveled using rental cars or their own cars. A 16% annual increase in the visits by tourists preferring to drive on their own is likely to happen in the next five years.
“Travel agencies like China Youth Travel Service are customizing their tour packages to include rental cars to enable road-tripping and sightseeing packages to places with limited transportation facilities, which will further lead to an average increase in the miles driven,” according to Praveen.
Growing use of synthetic oils in APAC
Synthetic engine oils are of different types such as PAO (poly-α-olefin), Esters, PAG (polyalkylene glycols), and Group III (hydrocracking). Currently, PAO has the largest market share, as it accounted more than 50% of the total market share due to several benefits compared with other synthetic engine oils. Its physical and chemical properties make PAO engine oils low volatile and oxidative as well as thermally stable compared with other engine oils. PAO synthetic engine oil is also less expensive compared with other synthetic engine oils.
The synthetic oil market is dominated by Europe followed by North America and then APAC. But APAC will experience a higher growth rate in the consumption of synthetic engine oils, as the automotive market is experiencing a higher growth. Synthetic engine oils are also used for various industrial purposes.
Increase in average vehicle miles driven
One of the positive factors influencing aftermarket sales of engine oil is the increase in the vehicles miles driven. The normal period of batteries used in vehicle lasts for approximately 4 years, depending on driving and weather condition. According to the Federal Highway Administration (FHWA), in the Americas, 70% of the states experienced an increase in the vehicle miles traveled per capita between 2011-2014.
Another factor supporting the growth of this market is the demographic factor of the consumers, according to the reports published by FHWA. In the US, the number of drivers over 50 years old has reached appropriately 93.5 million, resulting in an increase of 22% since 2003. In Europe, the average lifetime mileage of diesel cars (approximately 127,000 miles) is more than petrol cars (approximately 100,000 miles).
The key vendors are as follows:
- Shell
- ExxonMobil
- British Petroleum
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