As the brand new yr started and the Omicron variant of COVID-19 led to a surge in instances, a way of deja vu permeated the enterprise panorama. However economists say there may be cause for optimism in 2022. In its annual report condensing key viewpoints from dozens of funding outlooks, Bloomberg Information forecast that the worldwide economic system will develop by 4.5% this yr.
Composites Manufacturing journal caught up with 4 consultants to shine a highlight on three key market segments within the composites business and supply predictions on glass and carbon fiber.
The Automotive Market
By Marc Benevento, President
Final yr might be remembered for the promise of a robust restoration of automotive manufacturing adopted by the frustration of provide chain disruptions that suppressed year-over-year progress. Nonetheless, brighter days are forward for suppliers to the business as manufacturing is predicted to get well to pre-pandemic ranges over the subsequent 24 months. Moreover, the continued shift towards electrical autos will favor growing use of composite supplies within the automotive business.
The worldwide marketplace for mild car composite supplies was 3.7 billion kilos in 2021, far in need of the place it was just some years in the past. World mild car manufacturing plummeted 16% in 2020 as a consequence of COVID-19 shutdowns, and demand recovered extra rapidly than a confused provide chain may help. After a robust begin to 2021, international manufacturing gained a paltry 2% over a disastrous 2020, leaving automotive composites consumption 20% beneath the pre-pandemic degree.
Regardless of the difficulties of the previous two years, higher instances are forward for suppliers of automotive composites. Demand for cars stays robust, significantly in North America. Provide chain constraints are anticipated to ease over the course of 2022, and manufacturing ought to return to pre-pandemic ranges by late 2023 or early 2024. Suppliers which have weathered the storms of the previous two years have cause to hope that the subsequent two years will current a extra hospitable enterprise atmosphere, with 8 to 10% annual quantity progress anticipated in that timeframe.
Along with the tailwind of market restoration, composites proceed to win automotive functions based mostly on the worth they supply carmakers when it comes to value, weight and efficiency. Electrical autos are significantly effectively suited to composites as a consequence of their low beneath hood temperatures and the place they at present occupy out there, which is able to develop the obtainable marketplace for producers of composite supplies in cars.
Elimination of the inner combustion engine and exhaust system will considerably decrease the working temperature requirement of many automotive components, creating new alternatives for composites. Battery covers and enclosures are an ideal match for composites as a consequence of their excessive strength-to-weight ratio, corrosion resistance, design flexibility and half consolidation alternatives versus stamped steel assemblies. Difficult new fire-resistance requirements for electrical car parts might be met with the number of an applicable resin system or with the addition of intumescent coatings.
The present market place of electrical autos additionally favors progress of composite supplies. As a result of right now’s batteries value greater than an equal gasoline engine, electrical autos occupy a premium place out there. The excessive promoting value of those autos limits gross sales quantity, nonetheless, which typically favors composites. As manufacturing quantity decreases, the mounted value of dies for metal or aluminum stampings turns into a bigger a part of the unit half value, which improves the economics of composites for functions reminiscent of closure panels and truck beds. This development will proceed for at the very least the primary half of the last decade, after which battery prices are anticipated to be practically on par with inside combustion engines.
The expansion trajectory of automotive composites is illustrated by indexing car manufacturing and automotive composites quantity to a base yr of 2017 and projecting demand by way of 2025. Ought to composites proceed to develop above the market, as they’ve for the previous decade, automotive composite quantity will eclipse the bottom yr a full yr sooner than mild car manufacturing.
Determine X: Gentle Car Manufacturing & Automotive Composite Outlook
Supply: Industrial Market Perception
The Glass Fiber Market
By Dr. Sanjay Mazumdar, CEO
Greater than two years because the COVID-19 outbreak, the pandemic’s impact lingers on manufacturing operations throughout industries. The whole provide chain has been disrupted, and the glass fiber business isn’t any exception. Components together with delivery delays, will increase in ocean freight and container value, decreased Chinese language exports and buyer demand have led to shortages of composite uncooked supplies, reminiscent of glass fiber and epoxy and polyester resin in North America.
Even with provide chain points, the U.S. glass fiber market grew 10.8% in 2021, with demand growing to 2.7 billion kilos in comparison with 2.5 billion kilos in 2020. Building, pipe and tank, electrical and electronics, wind power, shopper items and marine functions skilled vital progress, whereas the aerospace market declined in 2021.
The U.S. glass fiber business benefitted significantly from progress within the wind power business in 2021 as a consequence of a rush to get development began in time to qualify for the manufacturing tax credit score (PTC) earlier than its expiration on the finish of the yr. As a part of the COVID reduction packages, the U.S. authorities prolonged the PTC to 60% of the total credit score quantity for wind tasks that started development by Dec. 31, 2021. Lucintel estimated 8% progress within the U.S. wind power market in 2021 after double digit progress in 2020.
The marine market additionally grew in the course of the pandemic as customers sought protected, socially distanced leisure actions within the outside. The U.S. glass fiber marketplace for marine was estimated to develop by 18% in 2021.
When it comes to provide and demand dynamics within the glass fiber business, the utilization fee elevated to 91% in 2021 from 85% in 2020 as a consequence of progress in consumption of glass fiber in all finish use industries. The worldwide glass fiber capability was 12.9 billion kilos in 2021. Lucintel predicts that the fiberglass plant capability utilization fee in 2022 will attain 95%.
Within the subsequent 15 to twenty years, there might be substantial innovation within the glass fiber business, significantly within the growth of high-strength and high-modulus glass fiber, which competes with different high-performance fibers like carbon fiber. Two mega tendencies throughout market segments that may result in additional improvements are light-weighting and carbon dioxide discount.
For instance, mild weight options are more and more essential within the wind power market because of the rising variety of offshore wind generators, repowering of previous generators and rising installations with excessive turbine capability in places that obtain high-speed wind. All through the market, the common measurement of wind generators continues to develop, which leads to a necessity for bigger and stronger blades. This, in flip, creates demand for lighter, stronger materials. A number of firms, together with Owens Corning and Jushi, have developed high-modulus glass fiber to fulfill market demand.
Whereas GFRP composites are a staple within the marine business, new applied sciences are altering the face of this market. Moi Composites, which developed a sophisticated 3D expertise, has produced the MAMBO (Motor Additive Manufacturing Boat). The 3D-printed 6.5-meter energy boat, constructed from steady glass fiber-reinforced thermoset composites, has no hull-deck division and employs concave and convex shapes not doable with conventional composite fabrication. The marine business has additionally taken steps towards better sustainability. RS Electrical Boats developed the primary all-electric inflexible inflatable boat (RIB) incorporating fiberglass and recycled carbon fiber in main structural parts.
In conclusion, using glass fiber in numerous industries is predicted to get well from the deleterious results of the pandemic. Transportation, development, pipe and tank, and the marine market particularly will play a significant function in serving to the U.S. market develop again to pre-pandemic circumstances. Total, the U.S. glass fiber market is predicted to witness robust progress in 2022 and absolutely get well from the fallout brought on by the pandemic.
Determine X: World Glass Fiber Demand and Capability
The Aerospace Market
By Richard Aboulafia, Managing Director
The plane business was hit by the COVID-19 pandemic as laborious as any business. World plane deliveries fell 35% in 2020 from 2019, whereas world air journey demand fell 66%. The business hadn’t seen something like these numbers because the jet age started.
But there are causes for cautious optimism. In response to preliminary year-end numbers, the business grew 7.5% in 2021. And 2022 ought to see a really robust 22% enlargement.
Navy deliveries have been hit final yr solely for logistical causes, together with pandemic-related manufacturing unit closures and provide chain disruptions. Precise demand wasn’t hit in any respect. International locations that originally introduced pandemic-related protection price range cuts, reminiscent of South Korea, reversed these plans and elevated spending over the earlier yr.
Home and export protection demand has been robust, each for geopolitical causes and since protection spending is seen as a great way for governments to help nationwide aerospace industries and nationwide economies in a really tough time. Navy output will absolutely get well to pre-pandemic ranges in 2022, with extra robust progress after that.
Enterprise plane have additionally come again quick, with utilization lately passing 2019 peak ranges. Company earnings, equities markets and oil costs – the three large drivers behind demand – are all at very excessive ranges, coupled with robust curiosity in avoiding the service cutbacks and excessive load elements of airline transport. Supply numbers are recovering accordingly, and we’ll see a return to 2019 peak ranges there (in items) subsequent yr.
Jetliners – usually accounting for round 60% of whole business output – are total in fine condition. We’re anticipating air visitors to return to its 2019 peak in early 2023. Gasoline costs are again from document lows to a excessive $80/barrel degree, whereas jetliner financing prices stay fairly low. This ratio – the price of gas to the price of capital – is crucial determinant of jetliner market well being after airline visitors. The market does greatest when costly (however not too costly) gas offers an incentive to interchange older jets and when there’s cheap financing obtainable for these new jets. Proper now, the ratio appears to be like wonderful.