Advanced materials market on a global scale was valued at USD 59.62 billion in 2018, with a 5.5% compound annual growth rate (CAGR). Furthermore, by the end of 2026, the market is projected to generate USD 125.46 billion. The global demand for advanced materials is growing as the world becomes more industrialized. Furthermore, the growing number of advanced material research and development activities in developing regions will be a key growth factor for the global advanced material market in the coming few years.
Advanced materials are materials that have been modified to have superior properties such as hardness, resilience, longevity, and elasticity. The scope of advanced materials research and potential applications is extremely broad. Furthermore, advanced materials are the primary factors that have accelerated the speed of technological advances. Many recent innovations in advanced materials have resulted in the production of a wide range of new products, including medical devices, computers, and warships.
By 2024, Asia Pacific is expected to command a market share of 58% in advanced materials. The region’s growth can be attributed to an increase in the number of industries and manufacturing activities. Aside from that, rapid industrialization and urbanization in emerging Asian countries like China and India are expected to propel the growth of the advanced materials sector.
Market Drivers
The growing use of advanced materials in the automotive and electronics industries is driving the demand for these materials. These materials outperform traditional materials in terms of superior properties like lightweight and high strength, longevity, and elasticity. These properties allow them to be widely used in other materials, parts, and end-products in these industries. Lightweight and energy-efficient vehicles are becoming increasingly important in the automotive industry. Nissan, for example, has decreased the weight of its Altima, Frontier, and Juke models to improve fuel efficiency. The use of electro-ceramics in electronics and semiconductors is rising globally. The enhanced properties of advanced materials including high damage tolerance, hardness, temperature resistance, and corrosion resistance are responsible for the rise in demand. Electro-ceramics also aid in reducing the total weight and scale of electronic devices. This has increased the consumption of these materials in the electronics industry, which has fuelled the growth of the advanced materials market.
European Advanced materials market dynamics
From 2018 through 2026, the European market is projected to develop at the fastest rate of 6.2%. The expansion and growth of the region’s automotive and aerospace industries are expected to be a major driver of the advanced material market in Europe. Furthermore, during this period, the vast availability of mineral resources and a high rate of adoption of advanced technologies are expected to drive the growth of the European advanced material industry. The main contributors to the development of the advanced material market in Europe are France and Germany.
By the end of 2024, Germany is expected to have a 21% market share in the global advanced material market. Furthermore, the German advanced material market is projected to expand at a CAGR of 6.5%. In comparison to the previous year, the advanced material demand in Germany is projected to rise at a 7.6% Y-o-Y rate in 2024.
Structural material, functional material, and new material are the three product segments in the global advanced material industry. The structural materials segment with a market share of 77% in 2016, is the world’s largest advanced material market. The widespread use of advanced materials in building and construction applications is expected to complement the global advanced material market’s growth.
The global advanced materials industry is also segmented based on the end-user. Building & construction is expected to continue to be the most popular end-user segment. In 2016, this segment accounted for about 33.5% of the overall advanced material industry. Furthermore, by 2024, this segment is expected to account for 27.7% of the industry.
Akzo Nobel N.V., 3M Company, BASF SE, DowDuPont Inc., Momentive Performance Materials Inc. are some of the key players in the global advanced materials sector. Some of the other prominent companies in this industry include Morgan Advanced Materials, Hanwha Group, Cytech Products Inc., and Hexcel Corporation.
Solvay is another important player in the European composites industry. The company’s headquarters are mainly in Belgium. In 53 countries, Solvay employs 30,900 employees. The organization is a significant contributor to the Solar Impulse initiative. Solar Impulse is a long-range solar-powered aircraft project based in Switzerland. Solvay was involved in the research and development phase of this project.
Key challenges
The high prices of advanced materials manufactured are one of the challenges in the global advanced materials market. The average price of certain advanced materials, such as Nanomaterials, is about USD 1000 per gram. Carbon fiber reinforced polymers are now used in a variety of industries, including aerospace, oil, and sports, due to their superior mechanical and thermal properties. Despite its many benefits, the demand for carbon fiber is likely to decline because its processing is many times more costly than its traditional equivalents. To achieve the desired effects, these often necessitate a regulated environment and high temperatures. These high prices will cause businesses to reconsider purchasing these, even though they have better properties than the other available alternatives.