ILMA Compoundings April 2018 - 25

PCMO MARKET FORECAST AND REGIONAL
VARIATIONS
In closing, even assuming a fast-paced adoption of EVs,
ICE vehicles will continue to prevail, accounting for threefourths of the global passenger vehicle population by 2040
In the near-term (2018-25), electric mobility is expected
to remain a niche market, with a limited influence on the
demand for engine oils and other finished lubricants.
In the long-term beyond 2025, growth of EVs is expected
to exert a greater influence on finished lubricants, mainly as
Global EV Population By Country and EV Type, 2040
250

200

150
HEV

100

PHEV
BEV

Saudi Arabia

South Africa

Brazil

Mexico

Russia

Australia

Canada

South Korea

India

France

China

Germany

United Kingdom

United States

Japan

LONGER-TERM DISRUPTORS - SHARED MOBILITY
AND AUTONOMOUS VEHICLES
Another key disruptor concerns the rise of shared transportation providers, ranging from ride-hailing services (e.g., Uber
or Lyft) to ride-sharing and car-sharing service providers. In

the near term, shared mobility services can cause higher car
utilization, boosting PCMO consumption because of the
more frequent oil change intervals. BEVs are not yet widely
used in shared mobility services due to concerns over their
driving range and charging infrastructure. However, once
these hurdles are overcome, shared mobility providers might
adopt BEVs instead of private drivers.
Looking into the future, AVs could become another large
disruptor of the broader transportation industry by transitioning to on-demand transportation models. However,
many challenges will need to be overcome before self-driving
cars are ready for the mainstream. Because of technological
and liability challenges, changes needed in infrastructure
and hacking issues, among others, they are not expected to
be commercially available or play a significant role before
the 2030s.

Million units

In the near term, HEVs and PHEVs remain popular
mobility alternatives. HEVs are already used often as
commercial fleet vehicles, bringing about the benefits of
reduced fuel costs. PHEVs can also use their ICEs when
needed. Both technologies still require engine oils, and drain
intervals are not expected to be very different from conventional ICE vehicles.
The deeper penetration of EVs has the potential to reduce
lubricant consumption, especially engineless BEVs, as
they eliminate the need for the largest product category -
PCMO. The silver lining is that BEVs will also create several
opportunities in areas including coolants, specialized greases,
and gear and transmission fluids. To maintain optimal operating temperatures, some EV manufacturers may use liquid
coolants for batteries as well as for moving parts, resulting in
increasing coolant consumption. Lubricant suppliers might
use this opportunity to introduce EV-specific specialty
products, with some offering dielectric properties. The
introduction of EV- and hybrid-specific specialty lubricants
creates an opportunity for lubricant suppliers to compensate
for volume losses with an increase in value.

ILMA Compoundings April 2018

Table of Contents for the Digital Edition of ILMA Compoundings April 2018