Page 130 - CW E-Magazine (28-11-2023)

Point of View

greasiness and odour, have been cause for concern. Though this has come to be largely addressed through the selection of the right additive,
the issue of plastics recycle at end-of-life remains largely unaddressed and recycling rates remain in the low single digits.

Automotive coatings
Automotive coatings are used to coat metal and plastic parts of an automobile, and are typically a multi-layer system, that, in cars, generally
consists of e-coat, primer, base-coat and clear-coat. The base-coat is the largest product segment and provides colour, decorative effects and
exterior aesthetic to vehicles, while the electro-coat serves as an anti-corrosion agent, and the clear-coat offers protection against the sun and
UV rays. Normally, the primer is the cheapest and basecoat is most expensive.
Despite the absence of regulations governing the choice of painting systems, technology shifts in India are in the direction of water-borne
systems – in line with international trends. Automotive paints require stronger technical capabilities than decorative paints, and that has driven
domestic players to tie up with large global paint companies and/or automobile majors. Though the OEM coatings segment accounts for about
two-third of the total market share in terms of volume, the refinish coatings sector is witnessing a faster growth, though it is more fragmented.

Impact of electrification
The possible large scale displacement of the internal combustion engine (ICE) by new generation EVs – in all its formats – represents the
most significant change in the automobile since assembly-line production commenced in the early part of the last century. Though ICEs are
not expected to disappear any time soon in India, there is good reason to believe EVs will take a growing slice of new car sales, prompted by
government diktats and possible fiscal support.

The rise of the EVs will have impacts – positive and negative – for the chemicals, materials and fuels that serve the industry.

The largest impact will be on fuels. Light vehicles currently account for about a third of global demand for refined products, and a transition
away from the ICEs will dent demand for petrol and diesel. Some of the negative impact on diesel sales will be mitigated by the fact that it is
likely to stay the preferred fuel for heavy vehicles, but petrol demand will bear the full brunt of electrification. As EVs do not have pistons, there
will be less demand for lubricants in the engine, though it will be required to service other rotating parts.

With faster adoption of EVs in India, peak auto fuel demand could be as close as 2030. The impact of this will be mainly on the country’s
refining sector, and will force reconfiguration of refinery product slates, and a greater emphasis on production of petrochemicals, not fuels. Early
indications of this are already evident in pronouncements made by large refiners in the public and private sectors.

Battery chemistry and markets will also offer opportunities, at least for a few chemical companies, and here India does not seem to be well
placed. Despite a lot of ongoing research, the lithium ion battery (LIB) containing varying formulations of oxidized metals (e.g., cobalt, nickel and
manganese) in the cathode is expected to be the dominant battery technology for now. India lacks the mineral resources for these metals, and
there are genuine concerns that we may well be trading a fossil fuel dependency for one on scarce minerals. There are some efforts to tying up
resources where they are available (e.g., in South America) through partnerships and collaborations, but these are as yet at a very preliminary
stage. Much publicity has been given to discoveries of lithium-bearing ores in Jammu & Kashmir and Rajasthan, but a lot of work will need to
be done to quantify, verify and evaluate their commercial exploitation.

A few chemical companies are eyeing opportunities in other battery materials such as carbon-based anodes, polymeric battery separators,
and electrolytes, but the numbers are expected to be small.

The rise of EVs will also add a new dimension to the material shift to plastics. With no fuel tank, pumps and other connections needed in
EVs, the nature of polymers used will change. Commodity polymers such as high density polyethylene (HDPE), conventionally used to make
the fuel tanks, will lose out, as will solvent-resistant SRs used in fuel lines. But new opportunities will emerge, such as the use of ultra-high
molecular weight polyethylene (UHMWPE) in LIB separators.

e-Mobility will also have some impact on demand for rubbers, but not in any major way. Tyres will still be needed, though their performance
attributes will change, which will offer new opportunities for speciality elastomers and additives.

In short, while the automotive industry of tomorrow will pose some new demands on the chemicals industry, offer new opportunities, and
throw-up new challenges, its relevance as a driver of growth will stay!
Ravi Raghavan

130 Chemical Weekly November 28, 2023

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