The diesel exhaust fluid market is forecast to reach $21.57 billion by 2022 from $10.64 billion in 2016 at a CAGR of 13.06 per cent during (2017-2022) driven by the increasing penetration of selective catalytic reduction (SCR) technology in exhaust system owing to stringent emission regulations and frequent re-filling of DEF.
The Asia-Oceania region constitutes the largest diesel exhaust fluid market for Original Equipment (OE) market. The Asia-Oceania region leads the diesel exhaust OE market owing to increasing vehicle production in countries such as China and India. The vehicle production in these countries is projected to grow at a CAGR of 4-5 per cent over the period of next five years. The SCR penetration for vehicles in these countries is also expected to rise after the introduction of stringent emissions standards such as BS IV and China 5 in 2017. This will lead to increased demand for DEF in this region during the forecast period.
The passenger car is the fastest growing vehicle segment in the diesel exhaust fluid after market. The passenger car segment has historically been emitting higher NOx emissions as compared to other vehicle segments such as LCV and HCV. However, with stringent emission standards such as Euro 6, the NOx emissions for passenger cars have been reduced to a very low level. To reduce the NOx emissions, exhaust after treatment has become a mandate in various countries. On the other hand, around 90-95 per cent of heavy commercial vehicles are already equipped with SCR. Hence, the passenger car segment offers a huge opportunity for the DEF after market.
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