Asphalt is a sticky, black, and highly viscous liquid or semi-solid form of petroleum that is present in most crude petroleum and can be refined from the heavier hydrocarbons of petroleum. Asphalt is primarily used for road construction as it forms a waterproof seal and protects the base material below it from moisture damage. It is widely used to make roads, bridges, parking lots, and airport runways. It provides excellent durability and strength for highways subjected to heavy loads and impacts from vehicles. Paving with asphalt is commonly less expensive than other paving materials and allows pavement designs that hold up well in different climates.
The global asphalt market is estimated to be valued at US$ 246.59 Bn in 2023 and is expected to exhibit a CAGR of 23% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
The development of renewable energy industries and e-mobility infrastructure is expected to drive the demand for asphalt over the forecast period. Asphalt is extensively used in the construction of solar farms, wind turbines foundations and related transmission infrastructure. Additionally, with the rapid adoption of electric vehicles worldwide, construction of EV charging stations is gaining momentum. As it is a durable and cost-effective paving solution, asphalt remains the material of choice for developing charging station parking areas and access roads around renewable power projects.
Another driver is the ongoing investments in road infrastructure development across both developed and developing economies worldwide. Governments are allocating higher budgets towards upgrading highways and building new road networks to improve regional connectivity and trade. This translates into increased consumption of asphalt globally. According to CMI analysis, over US$ 1 trillion worth of road construction projects are in the pipeline across regions like North America, Europe, Asia Pacific and Middle East & Africa in the coming decade.
Segment Analysis
One of the dominating sub segment in the asphalt market is paving grade asphalt which holds around 60% share of the overall market. Paving grade asphalt is used in the construction of roads, highways, parking lots and bike/running tracks. The demand for paving grade asphalt is high due to the increased infrastructural developments happening across regions for better road connectivity and transportation facilities.
PEST Analysis
Political: Governments across regions are investing heavily in infrastructure development projects like construction of roads, highways, railways etc which is positively impacting the demand for asphalt. Economic: With rising income levels and economic growth, the spending power of individuals and governments on infrastructure is increasing. This provides a boost to the asphalt market. Social: Rising urbanization is leading to more construction activities. People prefer better connectivity and transportation facilities which necessitates the use of asphalt in building roads and highways. Technological: New techniques are being developed to improve the performance and lifetime of asphalt pavements. Some of these techniques include use of recycled materials, modified binders in asphalt mix etc.
Key Takeaways
The Global Asphalt Market Growth is expected to witness high over the forecast period backed by rising infrastructure spending globally.
Regional analysis: The Asia Pacific region dominates the global asphalt market with over 35% share currently. Factors such as rising population, urbanization and industrialization in countries like China and India are driving heavy investments in transportation and road construction activities. This is increasing the demand for asphalt significantly in the region.
Key players operating in the asphalt market are Tesla, Duracell Power Center, Durapower Group, Contemporary Amperex Technology Co., Limited (CATL), and Toshiba Corporation. Key players are investing in capacity expansion and focusing on new product development to strengthen their position. For instance, Tesla aims to capture 20% share in the global electric vehicle battery market by 2024.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
