FUNCTIONAL FILMS MARKET ANALYSIS

Global functional films market was valued at US$ 29.02 Million in 2022 and is expected to exhibit a CAGR of 5.6%, in terms of revenue, over the forecast period (2023-2030) to reach US$ 45.06 Million by 2030.

Global Functional Films Market - Impact of Coronavirus (COVID-19) Pandemic

The pandemic has negatively impacted the demand for functional films that are used in a range of industries such as electronics, automotive, etc. Due to strict lockdowns imposed across the globe, bottlenecks in the supply chain were witnessed. Furthermore, demand declined due to decrease in construction and transportation activities. Companies have reduced investment in the market for functional films as a result of focusing on managing the pandemic's economic effects and fund maintenance.

The COVID-19 pandemic had a negative significant impact on the global market for functional films, due to decreased demand, supply chain disruptions, investment, changes in consumer behavior, and government stimulus.

Global Functional Films Market: Growth Drivers

Growing demand for electric vehicles

There has been a huge inclination of customers to buy electric vehicles for mobility which has led to a massive surge in the production of electric automobiles across the globe. This is mainly attributed to growing concern about the environment as conventional vehicles are not environment-friendly and can cause a huge threat to the ecosystem. The carbon di-oxide which is emitted on burning fossil fuel is responsible for rising global temperature on earth which in turn leads to global warming. To minimize the risk associated with vehicles running on fossil fuels, automobile companies have started looking to manufacture electric cars and other vehicles that draw electric energy sourced from renewable resources. Sales of functional films that are extensively used as an important utility in automobiles have risen on account of increasing sales of automobile cars and other passenger vehicles such as electric cars and buses. 

Rising utilization of solar-based applications

Increasing installation of solar panels is projected to propel the market growth of functional film. According to World Economic Forum, solar is expected to account for 60% of the increase in global renewable capacity by 2023. Therefore, the growing solar cell market is projected to propel the growth of the Global functional film market.

Figure 1. Global Driveline Additives Market Share, By Product Type, 2022

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Global Functional Films Market: Restraints

Stringent rules and regulations imposed on the production of toxic chemicals

Stringent rules and regulations are associated with the production of functional films which may lead to a decline in the growth of the market. Pollution is a major problem for industries that use fossil-based chemicals such as synthetic polymers as the primary raw material for manufacturing functional films. Due to the rising awareness about sustainability, various countries’ governments are imposing strict rules on the usage of toxic chemicals which are hazardous to the environment. This factor is expected to hinder the market growth of functional films.

Global Functional Films Market: Market Opportunity:

The market for functional film is expected to develop thanks to rising consumer electronics output, particularly in the Asia Pacific. In the production of smartphones and tablets, functional film is frequently used. According to the MMR study, the appliances and consumer electronics business is expected to reach in size US$ 45.06 Million by 2030

Global Functional Films Market: Segmentation

On the basis of product type, the global functional films market is segmented into conductive, optical, adhesive, and water-soluble. On the basis of application, the global functional films market is segmented into flat panel display (FPD), electronics & semiconductors, automotive, construction, energy, healthcare & pharmaceuticals, and packaging. Based on product type, the optical segment dominated the global market in 2022, accounting for 47% share, in terms of revenue, followed by conductive, adhesive, and water-soluble. The global functional films market is expected to witness growth in the near future, owing to an increasing number of electric vehicles manufactured every year and the increasing usage of functional films for electronics and semiconductor applications.

Figure 2. Global Functional Films Market Share, By Region, 2022

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Global Functional Films Market: Regional Analysis

Asia Pacific region dominated the global functional films market in 2022, accounting for 42% share, in terms of value, followed by North America and Europe.

Growing automotive industry in the region is expected to boost demand for functional films in Asia Pacific region. Due to the region's expanding economy and population, the automotive industry in Asia Pacific is growing. Furthermore, rising disposable income in the region has increased consumer spending on vehicles, which resulted in increasing demand for functional films. Significant economic expansion, expansion of the automotive industry, and rising industrialization are the crucial factors that are significantly driving the growth of Asia Pacific functional films market. China has the largest market share in the region. Increased demand from the automotive industry is expected to drive the global functional films market growth.

North America is expected to be the second-largest market for functional films. The demand for functional films in these regions in the North American and European automotive industry is expected to be driven by the alternative demand for thin polymer-based functional films. During the forecast period, the functional films market is expected to develop fastest in Middle East, Africa and Latin America.

Global Functional Films Market: Recent Developments

• In May 2022, Mondi, one of the leading market players in sustainable packaging and paper, collaborated with beck packautomaten, Germany-based machine supplier to launch a functional paper solution that has the potential to revolutionize e-commerce by replacing plastic packaging and creating right-sized packaging for a wide range of products.
• October 2021, Toray Industries, Inc., announced today that it has developed a new version of Lumirror™, its range of biaxially oriented Functional films. It created the new film by precisely controlling the height of surface protrusions, eliminating surface defects from coarse protrusions while delivering slipperiness and other desirable handling properties.
• January 2021, Eastman Company has announced a series of significant investments in Functional films, including a Performance Films Patterns and Software Center of Excellence, multiple expansions at its Martinsville manufacturing facility, and Core™ pattern and business operations software.
• September 2021, Tatsuta created an EMI shielding film for FPC applications, which protects the internal circuits of electronic mobile devices such as smartphones and tablet terminals, and gained an overwhelming global market share. We are also actively working on the expansion into the automobile field, where digitalization is accelerating, and the development of EMI shielding films for high-speed signal transmission for 5G, a new communication standard.

Global Functional Films Market: Key Companies

Key players operating in the global functional films market include 3M, Toray Industries, Inc., Nagase & Co. Ltd., Eastman Chemical Company, and Tatsuta Electric Wire & Cable Co., Ltd.

*Definition: Functional films are the type of films or sheets which are used for increasing the potential of a product by improving the functionality of the substrate. Along with providing dimensional benefits, these functional films are also compatible with a wide range of materials and recent modern technologies. In addition to this, they exhibit other benefits, such as lesser energy required for their processing as well as functional films can also be fabricated into customized composite structures based on the requirement.