Catalytic Converter Manufacturing in the US Industry Market Research Report Now Available from IBISWorld

Share Article

Over the five years to 2012, the Catalytic Converter Manufacturing industry endured the extremely volatile conditions that plagued the entire automotive sector. Because demand for this industry's products is derived largely from original equipment manufacturers (OEMs), the fate of catalytic converter manufacturers correlates highly with the performance of the major automakers. Thus, catalytic converter manufacturers endured two tumultuous years in 2008 and 2009. Automakers, the industry's main customers, encountered rapidly declining demand for vehicles in 2009: new vehicle sales fell 21.4%. However, a recovering economy created an uptick in demand for new vehicles, ramping up production lines at automotive manufacturing plants and fueling demand for catalytic converters. As a result, catalytic converter manufacturing revenue is expected to decline at a lower than expected annual rate over the five years to 2012. And, rising emissions standards and increasing demand for replacement and aftermarket catalytic converters helped sustain demand for catalytic converters over the long-term. For these reasons, industry research firm IBISWorld has added a report on the Catalytic Converter Manufacturing industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

A recovering economy boosted demand for new vehicles, fueling demand for catalytic converters

Catalytic converter manufacturers endured two tumultuous years in 2008 and 2009. Automakers, the industry's main customers, encountered rapidly declining demand for vehicles in 2009, and new vehicle sales fell 21.4%. However, a recovering economy created an uptick in demand for new vehicles, ramping up production lines at automotive manufacturing plants and fueling demand for catalytic converters, says IBISWorld industry analyst Brian Bueno. As a result, Catalytic Converter Manufacturing industry revenue is expected to decline at a lower than expected annual rate of 2.0% over the five years to 2012, totaling $2.1 billion. Despite the short-term commotion for the industry, rising emissions standards and increasing demand for replacement and aftermarket catalytic converters helped sustain demand for catalytic converters over the long-term. In spite of the fact that the majority of catalytic converters are purchased by new car manufacturers, aftermarket and replacement catalytic converters are also an important driver of industry revenue. As consumers pulled back on new vehicle purchases during the recession, the average age of registered vehicles in the US grew. As the vehicles on the road got progressively older, they were more likely to need replacement catalytic converters to meet emissions standards and pass smog tests. This increased demand for replacement catalytic converters throughout the recession. However, these trends have reversed in 2011 and 2012, as more people are purchasing new vehicles and the average age of the vehicle fleet is falling.

In the face of the auto sector's setbacks, manufacturers have made some structural changes that will yield long-term benefits including lower labor costs and production capacity matching demand more closely. Over the next five years, catalytic converter manufacturers will regain their stature, and in 2012, revenue will grow. The strong upward trend in car sales will bode well for the industry in the long run. Through 2017, catalytic converter manufacturing revenue is projected to climb. Over the next five years, regulatory intervention and full automaker recovery will drive growth through increased production of high technology and value-added catalytic converters, Bueno says. In addition, the possible regulation of carbon-dioxide emissions from vehicles would require expanded catalytic converter capabilities, further driving growth in the Catalytic Converter Manufacturing industry.

The Catalytic Converter Manufacturing industry is characterized by a low level of concentration, with the top three companies accounting for less than a fourth of industry revenue. Concentration has remained largely stable over the past five years, as companies choose to operate within particular market segments. While some companies, such as MagnaFlow, primarily serve the automotive aftermarket, other firms supply catalytic converters to automobile manufacturers through the original equipment manufacturer (OEM) market. Major company Tenneco derives the majority of its revenue through contracts with automobile and other equipment manufacturers. Other firms in the industry, such as Donaldson, also supply manufacturers. They typically work through contracts and supply specialized catalytic converters for specific vehicles or machinery; therefore, it is difficult for companies to expand beyond their particular market segments or develop products that can satisfy a wider share of the catalytic converter market. For more information, visit IBISWorld’s Catalytic Converter Manufacturing in the US industry report page.

Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189

IBISWorld industry Report Key Topics

This industry manufactures catalytic converters that are used in internal combustion engines. These converters remove toxic exhaust emissions, including carbon monoxide and unburned hydrocarbons, from engine output.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Gavin Smith
Visit website