The global EV fluids market size is expected to advance at a CAGR of 28.4% during 2022–2030, to reach USD 13,263 million by 2030. This can be ascribed to stringent regulations by governments to promote electric vehicles, the cost reduction in EV batteries to support the demand for cost-effective EVs, and the rising use of electric machinery in the construction sector.
Electric vehicle fluids are lubricant-based products designed for EVs formulated using high-quality synthetic oil, which can be in group IV and group V categories. As engine oil cannot be used as a lubricant in electric vehicles, due to technical specifications than petrol and diesel engines, these fluids are designed to meet EV standards. Also, these oils outperform various applications such as lubrication of transmission systems, reduction in friction, and stabilization of battery temperature.
The OEMs category holds the largest revenue share in the EV fluids market. This is because they are the biggest distribution channel and a large share of such oils is consumed by EV battery manufacturers. Also, producers of EV fluids partner with OEMs to boost their sales. For instance, Castrol is working with 3-wheeler electric vehicle giants to make use of its products.
Moreover, OEM fluids are made in the same way as the required specifications and also tend to be better for the life of EVs other than aftermarket fluids, which can be of some different specifications. OEM fluids comply with the warranty of particular electric vehicles. However, the warranty is void if aftermarket products are used. Choosing good quality oils helps drive with confidence without getting worried about repairs or broken down. Hence, the above factors drive the OEM sales of fluids used in electric vehicles.
Since the last decade, the EV sector across the globe has expanded exponentially. The majority of policies are coming into existence for promoting and increasing the adoption of electric vehicles. Significant fiscal incentives by governments have increased the sales of electric light-duty vehicles and exponential growth in the EV manufacturing and battery industries. The measures include vehicle subsidies and registration tax rebates. These steps are taken to reduce the price gap with conventional vehicles.
Furthermore, the use of publicly accessible chargers is very important for the adoption of electric vehicles. Thus, governments are providing support and expansion of EV charging infrastructure through different initiatives such as direct investment for the installation of public charges and incentives for EV owners to install a charger at home. Some buildings may need to reconstruct or work on infrastructure to include charging points, as in retail establishments and apartment blocks. Therefore, various efforts by different countries have encouraged the sales of electric vehicles, which, in turn, drives the demand for EV fluids.
For instance, China, as a market leader in the EV industry, is increasing the developments in making batteries, expansion of charging infrastructure, and new EV models. Also, India is taking necessary actions to develop the country as a leader in the electric vehicle sector, such as the launch of several schemes and incentives for boosting the demand for electric vehicles and also motivating other manufacturers for making investments in the R&D of new technology and expansion of their infrastructure in India. The government proposed several reforms to increase the market penetration of EVs in India. Moreover, the government has launched schemes such as Battery Swapping Policy, FAME-II, Special Electric Mobility Zone, PLI SCHEME, and Tax Reduction on EVs, which will create new opportunities for industry players in the forecast period.
The major companies operating in the EV fluids market are Royal Dutch Shell plc, ExxonMobil Corporation, TotalEnergies SE, Petronas, ENEOS Corporation, Repsol S.A., Valvoline Inc., Castrol, Gulf Engine Oil, Exxon Mobil Chemical, and Valmet.