DIESEL EXHAUST FLUID MARKET ANALYSIS

Diesel Exhaust Fluid Market Size and Trends

The global diesel exhaust fluid market is estimated to be valued at USD 39.98 Bn in 2024 and is expected to reach USD 67.63 Bn by 2031, growing at a compound annual growth rate (CAGR) of 7.8% from 2024 to 2031.

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Strict emission norms implemented by governments across the globe to curb pollution are expected to drive the diesel exhaust fluid market growth during the forecast period. Many countries in Europe and North America have implemented the Euro 6 and Tier 4 emission standards respectively. These standards promote the usage of selective catalytic reduction (SCR) systems, thereby increasing the consumption of diesel exhaust fluids. The increasing international trade and growing transportation & logistics industries will further drive the demand for commercial vehicles that use diesel exhaust fluids.

Tightening Emission Regulations

The tightening of emission regulations across the globe is a major factor driving the growth of the global Diesel Exhaust Fluid (DEF) market. Governments are focusing on reducing vehicular emissions and improving air quality in their countries. Strict emission norms such as Euro 6 by the European Union and Bharat Stage VI by India that have came into effect recently mandate the use of SCR technology in modern diesel vehicles to cut down nitrogen oxide emissions by over 80%. SCR technology requires diesel vehicles to be fitted with urea-based DEF dosing systems that inject the fluid into the vehicle's exhaust stream to convert nitrogen oxide into harmless nitrogen and water vapor. This has significantly increased the demand for DEF or aqueous urea from the automotive industry. According to the data from the Environmental Protection Agency, the newly introduced emission standards in the United States under their National Program has led to 95% reduction in nitrogen oxide emissions from long haul trucks and buses which has established the country as one of the largest DEF markets currently. Similarly, the statistics from the Department of Environment, Forest and Climate Change of India shows that over 30% of heavy commercial vehicles sold in 2021 were compliant with Bharat Stage VI norms requiring DEF, marking a huge rise over previous years.  Original equipment manufacturers globally have also started proposing SCR systems as standard fittings on their modern diesel models or fleets in order to meet the stringent norms, creating a steady demand stream for DEF. Furthermore, with developing economies pushing for early adoption of advanced emission standards as part of their nationwide pollution control plans, the uptake of DEF is expected to grow multifold in the future. The imminent implementation of next-gen emission regulations such as Euro 7 in Europe from 2025 will further raise the compliance bar and propel higher DEF consumption across major automotive markets.

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Alongside stricter emission rules, rising environmental consciousness among consumers has prompted automakers to manufacture vehicles with lower carbon footprint. This has contributed to the growing popularity of diesel engines, especially in the commercial vehicle segment. Diesel-powered trucks, buses, and other goods carriers offer better fuel efficiency and load-carrying capability compared to petrol variants. Regions like Europe and Asia Pacific have witnessed a massive surge in the on-road population of diesel commercial vehicles for the transportation of goods and passengers over the last decade. Moreover, pickup in infrastructure development, e-commerce, and logistics activities has also augmented freight transportation needs. With the number of diesel vehicles constantly increasing, the demand for DEF to meet their emission requirements is poised to rise steadily. Original DEF manufacturers and aftermarket players are capitalizing on this opportunity by expanding their supply and distribution networks globally.