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Market Overview

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The global market for immersion cooling fluids in electric vehicles (EVs) is projected to reach $3,837.0 million by 2032, growing at a CAGR of 30.78% during the forecast period 2022-2032. This significant growth is anticipated due to the increasing sales of immersion cooling system-equipped EVs worldwide.

EVs are revolutionizing the automotive industry on a global scale. Automotive manufacturers and policymakers are actively focusing on and taking action towards electric vehicles. Battery EVs and plug-in hybrid EVs have gained traction as they contribute to environmental and societal goals. Compared to conventional internal combustion engine (ICE) models, EVs are two to four times more efficient, reducing reliance on fuel-based vehicles and lowering greenhouse emissions. EVs also address air pollution issues with zero-tailpipe emissions. The rapid advancement in EV battery technology will facilitate a smooth transition to clean energy in the near future.

Growing concerns about the environment, carbon dioxide emissions, stringent regulations, and rising oil prices will drive the growth of the global EV market. Advancements in battery technology will boost the performance, reduce charging time, and lower the overall cost of battery modules, sustaining and further expanding the EV industry.

The demand for cooling fluids in gasoline powertrains is expected to decline with the rise of EVs. As EVs do not require engine oil or gasoline, companies are adapting their product portfolios to meet EV requirements. Many companies have shifted their strategies and invested in EV applications. The demand for cooling fluids in the electric vehicle industry has shown a steady increase.

Government subsidies and infrastructure development to promote EVs and reduce carbon emissions are driving the growth of immersion cooling fluids. For instance, the German government increased its share of the environmental bonus in 2021, providing higher subsidies for new EV purchases. Such initiatives encourage green mobility and boost the demand for immersion cooling fluids.

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Market Segmentation

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The market is segmented based on various factors, including propulsion type, vehicle type, application, product type, chemistry, and region.

Segmentation by Propulsion Type
Battery Electric Vehicles (BEVs)
Hybrid Electric Vehicles (HEVs)
Plug-in Hybrid Electric Vehicles (PHEVs)

Segmentation by Vehicle Type
Passenger Vehicles
Light Commercial Vehicles
Heavy Commercial Vehicles

Segmentation by Application
EV Batteries
EV Motors
Power Electronics

Segmentation by Product Type
Single-Phase Coolant
Two-Phase Coolant

Segmentation by Chemistry
Mineral Oils
Synthetic Oils and Esters

Segmentation by Region
North America
Asia-Pacific and Japan
China
Europe
U.K.
Rest-of-the-World

Based on the propulsion type segment, the battery electric vehicles (BEVs) are expected to dominate the global immersion cooling fluids market for electric vehicles (EVs) during the forecast period.

The immersion cooling fluids market for EVs covers three major types of electric vehicles: hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs), and battery electric vehicles (BEVs). These vehicle types exist in both passenger and commercial vehicle forms. While HEV and PHEV models have been in the market for many years, the advancement in battery technology and government regulations for increased vehicle efficiency have led to a rise in the adoption of BEVs, which rely solely on battery systems for power. The sales of BEVs are expected to surpass those of HEVs and PHEVs due to decreasing costs and the development of EV infrastructure in various countries. As BEVs become more prevalent, it becomes crucial for automotive OEMs to ensure that the immersion cooling fluids optimize thermal management and driving system performance.

In terms of vehicle type, passenger vehicles are projected to dominate the global immersion cooling fluids market for EVs due to the anticipated growth in the fleet of these vehicles during the forecast period. Passenger vehicles are used for transporting passengers and have been a part of the EV market segment for decades. European governments have taken initiatives to promote electric vehicle sales by providing tax benefits for purchases. Passenger EVs are gaining traction globally due to their eco-friendly nature and cost-effectiveness. Governments in various countries offer subsidies such as purchase rebates, tax exemptions, and fee waivers to incentivize the purchase of electric cars, further boosting sales. Countries like China and the U.S. have witnessed a significant surge in electric vehicle sales, even during the recent slump in the automotive industry. Additionally, countries like Norway and Sweden prioritize the installation of charging stations and EV service infrastructure to encourage EV adoption. Automotive OEMs are expected to implement immersion cooling systems in EVs as early as 2025, and they will seek collaborators to develop the necessary fluids for these systems. To address the challenges posed by EVs, these partners need to expand their testing capabilities. Experienced fluid manufacturers will be prepared by identifying critical failure mechanisms and focusing on establishing a safer environment through system and fluid testing.

The EV batteries segment is expected to lead the market among application segments during the forecast period, as more than four-fifths of the total immersion cooling fluid is used in EV batteries. Advancements in battery technology have led to increased power capacity and reduced charging time for battery systems, resulting in higher heat generation. As batteries operate within an ideal temperature range, high temperatures can impair their performance. Instability in battery system temperatures can lead to various issues such as decreased capacity, thermal runaway, and battery damage. Immersion cooling fluids play a crucial role in maintaining optimal battery system temperatures. Liquid cooling methods have been found to be more effective compared to other cooling methods, according to research conducted by the National Renewable Energy Lab (U.S.) and the National Active Distribution Network Technology Research Center (China). Major OEMs and battery manufacturers, including Tesla, BMW, LG Chem, Ford, Chevrolet, and Jaguar, have adopted liquid cooling methods for their battery systems. New types of fluids are being developed specifically for EVs to enhance the life and performance of lithium-ion batteries. For example, Engineered Fluids offers AmpCool, its product for immersion cooling of EV batteries.

The single-phase coolant segment is expected to dominate the immersion cooling fluids market for EVs as it is one of the most efficient and safe methods for controlling heat rejection in EV batteries, EV motors, and power electronics. Companies like Engineered Fluids are industry leaders in developing and manufacturing application-engineered dielectric cooling fluids for full immersion cooling solutions. They offer the most efficient, safe, and cutting-edge dielectric coolants.

In 2021, the synthetic oils and esters segment held the largest market share in the global immersion cooling fluids market for EVs, and it is expected to maintain its dominance throughout the forecast period. Synthetic oils and esters have high flash and fire points, are non-toxic, and biodegradable. The segment is projected to grow due to the increasing demand for effective and environmentally friendly cooling solutions for EV batteries. Synthetic oils and esters are used in EV batteries, EV motors, and other power electronics. Various types of synthetic oils are used in blending immersion cooling fluids, including isoparaffin, poly alpha olefin (PAO), synthetic esters, and VHVI oils. Synthetic fluids overcome the disadvantages of mineral oils, such as corrosiveness and flammability. The growing need for environmentally friendly cooling solutions for EV batteries is driving the demand for synthetic oils and esters. These base fluids offer design flexibility, purity, and cleanliness, providing high performance and adjustment capabilities to meet specific application requirements. They offer superior heat transfer performance, a good balance between viscosity and fire safety, high stability and cleanliness at high temperatures, and low traction coefficients for improved energy efficiency in transmissions.

Europe is a major manufacturing hub for immersion cooling fluids and is expected to dominate the market for EVs during the forecast period. Government regulations, technological advancements, significant investments in dedicated R&D facilities, and the presence of major EV manufacturers are key drivers behind the growth of the immersion cooling fluids market for EVs in the region. Germany, France, Italy, and Spain are the countries leading the European region in terms of EV adoption and manufacturing. According to the European Automobile Manufacturers Association (ACEA), the sales of battery electric vehicles in the EU increased in the second quarter of 2022, accounting for 9.9% of all new passenger car registrations. Plug-in hybrid vehicles also gained market share, reaching 8.7% compared to 8.4% in the second quarter of 2021. Meanwhile, sales of gasoline and diesel cars experienced a significant decline during the same period, resulting in a decreased market share (55.8% combined for gasoline and diesel).

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Competitive Landscape

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The selection of the profiled companies was based on inputs obtained from primary experts and an analysis of their coverage, product portfolio, and market penetration.

Key companies profiled in this report include FUCHS, The Lubrizol Corporation, 3M, Castrol Limited, M&I Materials Ltd., Engineered Fluids, Shell plc, TotalEnergies SE, Cargill, Incorporated, Dober, LANXESS, XING Mobility, MAHLE GmbH, Kreisel Electric, E-MERSIV, Tesla Inc., Volkswagen AG, SAIC Motors, BYD Co. Ltd., Stellantis N.V., General Motors, Ford Motor Company, Hyundai Motor Company, Honda Motor Co., Ltd., Groupe Renault, Toyota Motor Corporation, Bayerische Motoren Werke AG.

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Recent Industry Developments

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In June 2022, FUCHS completed the acquisition of the lubricants business of Gleitmo Technik AB in Kungsbacka, Sweden. Effective July 1, 2021, the acquired business will be integrated into FUCHS LUBRICANTS SWEDEN AB, a subsidiary of FUCHS. This strategic move aims to enhance FUCHS’ specialty business and expand its market presence.

In November 2021, Williams Advanced Engineering (WAE) and Castrol Limited established a five-year technical partnership to collaboratively develop high-performance fluids for electric vehicles (EVs). This joint effort seeks to leverage their respective expertise and innovation to create cutting-edge EV fluids that deliver exceptional performance.

In January 2021, MIVOLT and Faraday Future (FF), a globally recognized intelligent mobility ecosystem company, formed a partnership to jointly develop a fully submerged battery cooling system for FF’s luxury electric vehicle, the FF 91. This collaboration aims to advance the capabilities of battery cooling systems and contribute to the overall technological advancement of the EV industry.

In October 2022, Shell plc expanded its specialized fluids portfolio by introducing Shell E-Fluids, specifically designed to support battery electric (BEV) and fuel cell electric (FCEV) powertrains in commercial light, medium, and heavy goods vehicles. This product enhancement demonstrates Shell’s commitment to providing tailored solutions to meet the evolving needs of the electric mobility sector.

In July 2021, TotalEnergies SE launched a dedicated hybrid transmission fluid for Great Wall Motors, a prominent Chinese car manufacturer at the forefront of EV development. This specialized fluid is specifically formulated to optimize the performance and efficiency of hybrid vehicles, showcasing TotalEnergies’ dedication to supporting the transition towards greener transportation solutions.

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Key Questions Answered

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What are the main drivers and challenges faced by players in the global immersion cooling fluids market for electric vehicles (EVs)?

How does the supply chain operate in the global immersion cooling fluids market for EVs?

What has been the impact of COVID-19 on the global immersion cooling fluids market for EVs?

Which significant patents have been filed by companies actively involved in the global immersion cooling fluids market for EVs?

What are the business and corporate strategies adopted by fluid manufacturers operating in the global immersion cooling fluids market for EVs?

What are the key consumer preferences in different regions for the global immersion cooling fluids market for EVs?

How is the market landscape expected to shape up for immersion cooling fluids manufacturers in the electric vehicle segment?

Which companies are meeting the demand in the global immersion cooling fluids market for EVs?

What are the key offerings provided by prominent companies in the global immersion cooling fluids market for EVs?

Which regions and countries are leading in terms of consumption in the global immersion cooling fluids market for EVs, and which ones are anticipated to experience high demand growth from 2021 to 2032?