Hot melt adhesives are formulations based on thermoplastic polymers which can be softened and reshaped on heating above their melting point. These adhesives are applied to the material in a liquid state and offer easy to clean application with minimum toxicity.
By volume, the market is estimated to witness a CAGR of 4.95% from its recorded consumption volume of 150.13-kilo tons in 2019 to ** million tons by 2027
The market is segmented based on the product type as glue sticks, sprayable adhesives, and bulk hot melt adhesives. Bulk hot melt accounts for a significant market share of 53.78% in the year 2019. It is expected to grow at a CAGR of 5.97% during the forecast period.
In the context of material type, the ethyl-vinyl acetate segment holds the largest market share of 39.17% in 2019, with a growth rate of 6.17% during the forecast period. EVA resin is a primary raw material in hot melt production about its economic feasibility and high performance. EVA offers superior heat & UV resistance, low-temperature flexibility, and high toughness, which is utilized in automobiles' interior liners.
The Asia Pacific is projected to have the largest market share and dominate the global automotive hot melt adhesives market from 2020 to 2027 due to India, China, and South Korea's growing automotive production activities.
COVID-19 pandemic had a significant negative impact on the global hot automotive hot melt adhesives market. The production halts in automotive and supply chain disruptions across automotive and adhesive industries led to a decline in hot melt consumption in automotive applications.
Market Dynamics
Drivers
- High usage in carpets and headliner to withstand high vibration
- Growth in commercial and passenger vehicle production
Restraints
- Highly volatile raw material prices
- Technical limitations of hot melt adhesives for certain automotive applications
High usage in carpets and headliner to withstand high vibration
The hot-melt adhesive has found many applications in automobiles, including carpets, headliners, engines, transmission, radiators, batteries, seats, and many more. Many applications in automobiles require high heat-resistant materials, which can hold the parts together and sustain them for a long time.
Carpets face movement push and high heat every day, which require strong adhesion. Also, cargo and passenger movement makes it even difficult for the carpet to stick to the bottom.
Headliners also face high heat in Arid regions, which further puts pressure on adhesive. In Arid climate regions, roof temperature reaches more than normal and requires hot-melt adhesive to withstand high temperature.
The market is witnessing large numbers of product launches, particularly in countries like India, owing to high growth potential and widening applications. In September 2019, Lecta launched a new Adestor Hot melt adhesive range, which can be used in automobile, food, and packaging applications.
The high demand for automobiles in the Asia-pacific region also increased the production and consumption of hot-melt adhesive in the region, especially in India, China, and Indonesia.
As per OICA (International Organization of Motor Vehicle Manufacturers), China alone contributed over 28% production of passenger cars globally, followed by U.S. 11.85%, Japan 10.55%, Germany 5.08%, and India 4.92%. Out of the top 5 manufacturers, 3 are in the Asia-pacific region.
Market Segmentation
Bulk hot melt adhesives include hot melt adhesives in the form of pebbles, pillows, bags, and others filled into the gun. Bulk hot melt adhesives are a popular adhesive category and are used in applications ranging from packaging to product assembly in the automotive industry. These glue materials are filled into the glue gun tank and used for remote bonding applications in the automotive assembling process.
It offers easy-to-dispense and versatile operations for bonding and sealing of plastic, resin, and various other materials in both interior and exterior applications.
The global bulk hot melt adhesives market valued at USD 9382.59 million in 2019 and is estimated to grow at a CAGR of 5.97% during 2020-2027. Bulk hot melt held the largest market share of 53.8% in the year 2019.
Since bulk hot melt is typically melted inside a glue gun before being dispensed, it’s more universal than a hot melt stick which comes in exact sizes to work with specific dispensers.
Also, these product types are economical compared to glue sticks. As bulk type adhesive undergoes less manufacturing, packaging, and distribution, the cost per pound of bulk hot melt is significantly lower than individual sticks.
Bulk hot melt held a significant market revenue share of 55% in the Asia Pacific automotive hot melt adhesives market. The government initiative ‘Make in India’, which promotes domestic raw material production, is likely to boost domestic production of adhesives, including bulk hot melt variants in APAC. Wide application spectrum and easy manufacturing turn adhesive manufacturers towards producing bulk hot melt adhesives in the region.
Geographical Analysis
North America is one of the key consumers of hot melt adhesives in automotive applications. The automotive hot melt adhesives market in North America valued USD 143.17 million in 2019 and is estimated to reach USD 190.24 million in 2027, growing at a CAGR of 4.76% during 2020-2027. The well-established automobile production industry in the U.S. is the paramount factor driving the regional market
The U.S. is the second-largest automotive producing country, next only to China. According to the International Organization of Motor Vehicle Manufacturers, the annual production of cars and commercial vehicles in the country are reported as 2.51 million and 8.37 million units in 2019
General Motors and newly formed Stellantis N.V. through the merger of Groupe PSA and Fiat Chrysler Automobiles, are the largest automotive manufacturers in the U.S> and are followed by companies such as Toyota Motor Corporation and The Honda Motor Company, Ltd., All these automobile giants are the extensive users of hot melt adhesives in their production and assembling operations.
The restrictions on the use of solvents and regulatory pressure to reduce solvent use motivate automakers to shift from solvent-based adhesives towards hot melt for their assembly operations. Moreover, the potential benefits offered by hot melts, such as fast adhesion, light-weight bonding, and superior bonding strength over other adhesives, are driving the use of hot melt adhesives in the automotive industry.
Canada and Mexico are also among the leading producers of automobiles globally and contribute to the growth of the hot melt adhesives market in the region.
However, the recent downturn in automotive production in the region due to weakening demand and competition from European automotive companies declined the automotive hot melt adhesives market. Automotive production in the U.S., Canada, and Mexico declined by 3.7%, 5.4%, and 2.8%, respectively in 2019
The outbreak of novel coronavirus and lockdowns imposed to control the spread of COVID-19 has a significant negative impact on the market. Automotive production declined with production halts and supply chain disruptions, adding to the downturn of hot melt adhesives consumption.
Also, hot melt adhesive production by itself witnessed considerable production and supply disruptions during the pandemic, including unavailability of raw materials, increased operating expenses, and many others.
Bostik (a subsidiary of Arkema), The 3M Company, Evans Adhesive Corporation, and H.B. Fuller Company are among the leading producers of automotive hot melt adhesives in the region.
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