The global polyvinyl butyral market was valued at around USD 3,150 million in 2020, and it is expected to register a CAGR of over 5%, during the forecast period of 2021-2026 .
The market was negatively impacted by COVID-19 in 2020. Considering the pandemic scenario, the automotive manufacturing activities were stopped temporarily during the lockdown to curb the spread of new COVID-19 cases, thereby reduced the demand for PVB material for fabricating a safe, impact-resistant automotive windshield. For instance, according to OICA, global passenger car production was reduced by 16.9% in 2020 compared to the previous year, majorly due to the negative impact of the pandemic. Furthermore, the construction activities were also on a temporary halt during the lockdown, thus negatively impacted the demand for PVB, which is used in the fabrication of laminated glass for windows, overhead glazing, partitions, and others.
Key Highlights - Over the short term, the increasing number of applications for laminated glass is expected to drive the market’s growth.
- On the flip side, unfavorable conditions arising due to the impact of COVID-19 is expected to hinder the market’s growth.
- Growing demand from the photovoltaic industry is likely to act as an opportunity for the growth of the market in the coming years.
- Asia-Pacific region is expected to dominate the market and is also likely to witness the highest CAGR during the forecast period.
Key Market Trends
Automotive Segment to Dominate the Market
- Polyvinyl butyral is a polymer material with excellent mechanical properties and is majorly used as an interlayer material for laminated glass. The PVB sheet bonds with both layers of the glass and keep them intact even upon impact. The bond between PVB sheet and glass is a chemical bond, and thus it does not delaminate easily. The laminated glasses are likely to be made of float glass or tinted glass. The layers of glass and PVB sheets can be increased according to their strength. - PVBs are primarily used in laminated safety glass for automobile windshields. PVB prevents the shattering of glass. Windshields in vehicles can be dangerous during an accident. In order to ensure maximum protection of the driver and passengers, each windshield is coated with safety PVB films. The PVB film layer in between twin glass layers provides a high level of safety. - The demand for PVB as an interlayer in the sandwich laminated glass has been growing significantly, owing to the safety and security it delivers in automobile windshields. In addition, acoustic insulation and UV protection are the major features of PVB that enhance their usage in the automobile industry. - Automotive industry has been observing a downfall for a couple of years, and the pandemic worsened the situation. The International Monetary Fund (IMF) has pegged the automotive industry as a major factor in the overall lagging of industrial output. A prolonged contraction period of the sector may affect the global economy for a longer period, both in the short-long runs.? The decreasing automotive production accounts for a decrease in the manufacture of automotive parts, thus restraining the polyvinyl butyral market across the world.? Also, the lockdown regulations made people stick to homes and thus reduced the usage of automobiles, which decreased the demand for PVB. - According to OICA, 2020 noticed a 16% drop in automobile production from 2019, accounting for 77 million. However, from January to June 2021, global automotive production reached more than 40 million, which was a slight gradual increase from 2020. - Asia-Pacific, the largest automotive production region, also witnessed a decline of 10.2% in 2020. The production decreased from 49.33 million in 2019 to 44.28 million in 2020, respectively. China, which was hit hard by the pandemic in 2020’s first three quarters, recovered quickly. The Chinese reduction in production has been limited to only 2%. - Therefore, the aforementioned factors are expected to show a significant impact on the market in the coming years.
Asia-Pacific Region to Dominate the Market
- Asia-Pacific is expected to dominate the global market owing to the increasing construction activities in China, India, Japan, and Singapore coupled with the continuous investments done in the region to advance solar energy production activities.
- According to the National Bureau of Statistics of China, the construction output value in the country increased from CNY 9.6 trillion in 2010 to CNY 26.39 trillion in 2020.
- Furthermore, India is likely to witness an investment of around USD 1.3 trillion in housing over the next seven years, during which it is likely to witness the construction of 60 million new houses. The rate of availability of affordable housing is expected to rise by around 70% in 2024. The Indian government’s ’Housing for All by 2022’ is also a significant game-changer for the industry. Additionally, the Union Cabinet has approved setting up a USD 3.58 billion alternative investment fund (AIF) to revive around 1,600 stalled housing projects across the top cities in the country.
- According to the Organisation Internationale des Constructeurs d’Automobiles (OICA), Asia-Pacific leads the global automobile market in terms of production. Although there’s a decline in production recently, China is the largest consumer and producer of automobiles.
- According to the Organisation Internationale des Constructeurs d’Automobiles (OICA), around 25.23 million vehicles were produced in China during 2020, compared to 25.75 million vehicles produced in 2019, witnessing a decreasing growth rate of about 2%. However, in the first half of 2021, the production of vehicles in the country reached 12,569,475 units, registering a growth rate of 24%, compared to 10,116,915 units, over the same period in 2020. This scenario is expected to boost the polyvinyl butyral market.
- Furthermore, the Chinese government is promoting electric vehicles and thus positively influencing the market. In April 2020, the Ministry of Finance of the People’s Republic of China issued a notice on ways to promote financial subsidies for new electric vehicles. It stated that new EVs purchased between January 1, 2021, and December 31, 2022, is likely to be exempted from vehicle purchase tax.
- PVB also finds its application in the photovoltaic sector. Solar panel glasses consist of PVB interlayers, which ensure the long-term durability of the solar modules. The demand for solar energy from developing countries has been phenomenal in the recent past.
- For instance, India has added 3.2 gigawatts (GW) of solar capacity in 2020, with a decline rate of 56% compared to the 7.3 GW addition in 2019. Furthermore, as of December 2020, India has 39 GW total solar installed capacity and the country has planned to reach 100 GW of solar capacity by 2022.
- Therefore, the aforementioned factors are expected to show a significant impact on the market in the coming years.
The polyvinyl butyral (PVB) market is partially consolidated in nature with a few major players dominating a significant portion of the market. Some of the key players in the market include Eastman Chemical Company, Kuraray Co. Ltd, Sekisui Chemical Co., Ltd., Kingboard (Fogang) Specialty Resins Co. Ltd (KB PVB) and Chang Chun Group, among others.
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Gross Domestic Product
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