Market Trends of Canada Lubricants Industry
This section covers the major market trends shaping the Canada Lubricants Market according to our research experts:
Engine Oil to Dominate the Market
- Engine oil is the leading product type owing to its high volume requirements and low drain interval, as it is used for high-temperature and high-pressure applications. It is often known as motor oil and is made to lubricate internal combustion engine parts, as well as to shield them from corrosion and keep them cool while operating.
- Engine oil is composed of two major components: base stock and additives. Typically, 95% of the solution comprises base stock derived from petroleum, synthetic chemicals, or a combination. The base stock is in charge of dissipating accumulated heat and lubricating the moving elements of an engine.
- The additives, on the other hand, make up around 5% of the oil, and these compounds are in charge of precisely regulating the oil's lubricity and viscosity and shielding engine parts from wear. For instance, Zinc dialkyl dithiophosphate (ZDDP) is a commonly used additive for preventing wear, while magnesium sulphonates aid in the breakdown of pollutants and engine sludge.
- Engine oils find applications in various end-user industries, including automotive, power generation, heavy-duty equipment, and other industries. There are typically three types of engine oil such as mineral oil, semi-synthetic oil, and full synthetic oil.
- The automotive industry highly consumes engine oil. In Canada, the engine oil demand is mostly supported by the servicing requirements of the current on-road passengers and commercial vehicles. The primary cause of the highest engine oil consumption was the widespread use of class 7 and class 8 trucks, which have diesel engines with high lubricant consumption requirements.
- Furthermore, according to Statista Canada, the total number of road motor vehicles (gasoline and diesel fuel type) registered in Canada increased to 25.6 million in 2021, up 1.4% compared with 2020. With the increased number of gasoline and diesel road vehicle registration in the country, engine oil consumption also increases.
- With the increasing demand from various sectors in the country, engine oil consumption is expected to boost during the forecast period.
Understand The Key Trends Shaping This Market
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Automotive Industry to Dominate the Market
- In the automotive sector, various lubricants, such as engine oil, transmission oil, hydraulic oil, greases, and other lubricants, are used in commercial vehicles and motorcycles.
- Engine oils keep the engine clean and rust-free, improve fuel efficiency and performance, enhance its life, and reduce vehicle emissions.
- Canada is North America's second-largest automotive market. Most international automakers have operations in Canada, such as Ford, General Motors, Stellantis (previously FCA), Toyota, and Honda, which have local assembly lines.
- According to the international trade administration, the industry estimated that the annual retail value of the automobile aftermarket was over USD 19 billion and was largely stable in 2021.
- According to Statistics Canada, during the first 11 months of 2022, the new motor vehicle sales in the country were 1.4 million units. Moreover, according to OICA, in 2021, automotive sales recorded over 1.7 million units, an increase of 7% compared to 2020.
- In the automotive industry, commercial vehicles were the leading vehicle type. In 2021, about 1.38 million units of commercial vehicles were sold in the country, recording a growth rate of about 9% compared to 2020. The high usage of trucks was the key reason for selling commercial vehicles in the country.
- Thus, the factors above are expected to impact the automotive industry, which, in turn, may affect the growth of the lubricant demand in the country.
