Market Challenges And Opportunities

Global Automotive Fuel Tanks Market Drivers:

Increasing demand for and sales of commercial vehicles is expected to propel growth of the global automotive fuel tanks market during the forecast period. The demand for commercial vehicles continues to increase in several regions around the world, due to growth of logistics industry, rise in usage of light commercial vehicles, growing e-commerce industry, and rise in number of sales of commercial vehicles. For instance, as per the Eurostat data, nearly 75% of inland cargo is transported within European Union by road, which is nearly 1,750 billion metric ton-kilometer. In some of the European countries, the rate of inland cargo transport is as high as 90% or more.

Moreover, implementation of stringent fuel and emission economy regulations by governments is also expected to augment growth of the global automotive fuel tanks market over the forecast period. Due to enactment of emission and fuel economy regulations for commercial vehicles, auto makers are focused on manufacturing electric trucks. This in turn is expected to drive the demand for fuel tanks, which is expected to propel growth of the market in the near future.

Global Automotive Fuel Tanks Market Opportunities:

Increasing technological development in fuel tanks is expected to provide market players with growth opportunities in the global automotive fuel tanks market over the forecast period. Various technologies from different industries such as self-sealing fuel tank technology from aviation sector are emerging in the automotive sector. In this technology, when there is leakage, the fuel goes into the layers causing the swelling of layers and then the damaged part starts to repair itself on its own. Vehicles such as the new Range Rover Sentinel features this self-sealing technology, and it will be used of various other automobiles in the future. Thus, this factor is supporting growth of the market.

Growing use of lightweight materials to build cost-effective fuel tanks is also expected offer growth opportunities in the global automotive fuel tanks market over the forecast period. Gaseous materials such as hydrogen, LNG, and CNG used in alternate fuel vehicles. These materials need safe, lightweight, and strong tanks for maintaining normal vehicle weight, size, and driving range. As fuel tanks made from common grade steel slowly get damaged due to migration of gas into metal, manufacturers are increasingly using lightweight materials such as HDPE plastic. Fuel tanks made from this material are safe to use and are light in weight to be used in vehicles, and this in turn reduces the overall vehicle weight. Thus, the market will be presented with various opportunities with increasing use of lightweight material for fuel tanks.

Global Automotive Fuel Tanks Market Restraints:

The growth of global automotive fuel tanks market is expected to be hindered by factors such as rise in demand for electric vehicles all over the world. As the development of electric vehicles technology is increasing along with the production and sales of these vehicles, the automotive engines will be rapidly replaced by electric motors. Moreover, governments around the globe are promoting use of EV to reduce pollution caused due to fuel-powered vehicles. For instance, the government of United Kingdom and France have announced a deadline for automakers to go fully electric by 2040. Hence, this factor is likely to hinder growth of the global automotive fuel tanks market during the forecast period.

Another factor hampering the market growth is increase in cost of base metal aluminum. Recently, owing to the looming trade war between the U.S. and other countries, the cost of base metals are under pressure. Due to the implementation of tariffs on the imports from the U.S. allies including Mexico, Canada, and European Union, on steel (25%) and aluminum (10%), the cost of domestic aluminum is projected to grow. This is further likely to impact the automotive industry, and subsequently the demand for automotive fuel tanks. Thus, the increase in cost of base metal aluminum is expected to impede growth of the market.