ILMA Compoundings - April 2020 - 18

INDUSTRY RUNDOWN

Market Report
EV Fluids Will Spark BEV Sales
By Sharbel Luzuriaga
Advanced electric vehicle (EV) fluids are set to help
overcome the key barriers to the wide adoption of
full-battery EVs (BEVs). Kline Group reveals findings of
the latest electric vehicle fluids market research and
explains how these high-value, specialized fluids could
play a crucial role in accelerating BEV adoption.
Tightening carbon dioxide emissions limits and consumer pressure for more sustainable and more fuel-efficient
motoring are driving passenger car OEMs to invest in the
use of energy from sources other than petroleum. While
the uptake of hybrids in the form of a combination of the
internal combustion engine (ICE) and battery technology
has been strong, the sales of pure BEVs remain low. Our
estimates suggest that in 2019 only a small percentage of
new passenger car sales were pure BEV powertrains. China
is currently the largest electric vehicle market. In 2018,
approximately 1 million EVs were sold, of which BEVs
accounted for about 75% of the total, while plug-in hybrid
EVs (PHEVs) accounted for the balance.
Forecasts on when to expect wider adoption vary widely,
but most industry watchers agree that the ICE will dominate the market for the next 30 years and beyond. Kline
analysis, based on the most-likely scenarios, indicates that
even in the major markets of Japan, China and the U.S.,
ICEs are still expected to account for more than 60% of
the vehicle population in 2040. This will be reflected in the
lubricants market, where demand for conventional ICE
engine oils and transmission fluids will represent most sales
by volume.
So, what's preventing the mass-scale consumer acceptance
of battery-powered cars? Right now, there are three key issues:
relatively high vehicle cost, long charging time and limited
vehicle range. All of these barriers need to be overcome, and,
in our view, EV fluids will be a major part of the solution.
Although conventional ICE lubricants are currently used
for most EVs, there will soon come a point when they
will struggle to meet the performance requirements of EV
technologies. It is unlikely that they will be able to deliver

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APRIL 2020

| COMPOUNDINGS | ILMA.ORG

the enhanced cooling and electrical properties that EVs of
the future will require in addition to traditional lubrication. Those specialist EV fluid manufacturers, which can
help remove the three key barriers currently deterring BEV
uptake, will make significant gains in this growing market.
A new dimension of challenging technical requirements
for electric vehicles will allow leading lubricant developers
to showcase cutting-edge technology.
REMOVING THE BARRIERS TO EVS
1. Reducing cost
The higher price tag of BEVs is probably still the most significant deterrent, with even the more entry-level Tesla 3 starting
at $50,000. Currently, the higher purchase price is being
offset in some regions by government incentives and subsidies.
But where these are minimal - or as existing schemes end -
OEMs need to find ways to bring the price tag closer to that
of conventional vehicles to attract customers.
EV fluids can help to prolong battery life and contribute
to reduced battery thermal degradation, which, in turn,
extends the service life of the vehicle. The thermal management system in EVs, particularly BEVs, plays a vital role in
maintaining a balance between performance and thermal
degradation of the batteries in the vehicle and can help
extend their life span.
EVs typically use lithium-ion battery packs, which have
high power-to-weight energy density, long life span and low
self-discharge rate. The power output of these batteries is
highly dependent on the effectiveness of the cooling system
used for these batteries. Batteries generate heat when they
discharge and can only maintain optimum performance
within a certain temperature range: typically 25 degrees
Celsius to 40 degrees Celsius.
While EV fluids cannot directly reduce the cost of the battery by extending its operational life - and hence the life of
the vehicle - they can help to reduce total cost of ownership.
2. Faster charging
An electric car can take several hours to charge from empty
to full using a home charging point. This time to charge can


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ILMA Compoundings - April 2020

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