Increase in Diesel cars drives market says Frost &
Sullivan
The efficiency of the diesel engine, the vehicles' lower prices compared to
their gasoline equivalents and evolving fuel taxation policies have
resulted in a higher penetration of diesel vehicles in some European
countries. This increase in the number of cars has compensated for their
improved fuel economy and so, consumption of diesel fuel in Europe is
forecast to increase by over 2% per year to 2008. According to new
research by international market analysts Frost & Sullivan, this will have
a positive effect on the diesel fuel additive market, which is valued today
at $260 million and is forecast to grow with a compound annual growth rate
of 5% to reach $367 million by 2008.
The other main driver for this market is European Legislation. EC
directive 98/70/EC states that from 2005 sulphur content should not exceed
50 parts per million (ppm) in diesel fuels sold around Europe. This has
been introduced owing to the harmful effects of Sulphur compounds on human
health and their negative impact on some catalytic convertors. However,
when sulphur is removed from fuel some of the fuel's natural lubricating
properties are also removed. Lubricity improver additives are used to
counteract this effect and the legislation will thus herald a growth period
for lubricity improver additives.
Owing to increased pressure across Europe concerning emissions reduction
and fuel economy improvements, cetane improvers which aid ignition, improve
combustion and reduce emissions will also enjoy a period of growth
forecasts the report. However, in the longer term refineries may choose to
meet these requirements by modification of the production process.
All in all this spells good news for the diesel fuel additive companies who
will enjoy a period of growth. However, with continued consolidation of
the oil industry there will be fewer customers with increased buying power.
Moreover, the harmonisation of specifications within the EU will lead to an
easier pan European purchasing strategy, which in the longer term could
push prices down and make it more difficult to increase market share
The report gives a comprehensive view of the Diesel and Gasoline fuel
additives market in Europe. Key forecasts for each additive, competitive
analysis, pricing and volume trends are all discussed.