The current market development status and industrial chain composition of China's automotive filter industry

I. Current Market Development Status of China's Automotive Filter Industry

In recent years, the market size of China's automotive filter industry has continued to grow. According to statistics, the market size of automotive filters in China was 12.72 billion yuan in 2011, and by 2022, this figure had grown to 38.28 billion yuan, with a compound annual growth rate (CAGR) as high as 10.5%. It is expected that the Chinese automotive filter market will continue to maintain a growth trend in the coming years.

In terms of market demand, the demand for filters also shows a trend of increasing in a stepwise manner year by year. From 2011 to 2022, the demand for automotive filters in China increased from 530 million sets to 1.60 billion sets, nearly tripling. This growth is mainly attributed to the continuous increase in the number of cars and the improvement of consumers' awareness of car maintenance.

II. Composition of China's Automotive Filter Industry Chain

The industrial chain of automotive filters in China has basically taken shape, including three main links: upstream raw material supply, midstream filter production and downstream application fields. The following are the specific data of each link in the industrial chain:

• Upstream raw material supply

The upstream of the filter mainly consists of the raw material industry, including rubber, steel, filter paper, aluminum ingots, etc. The quality and supply stability of these raw materials have a significant impact on the performance and quality of the filter. According to the relevant data released by the China Research Industry Institute in the "2024-2029 China Automotive Filter Industry Market Panorama Research and Investment Value Evaluation Research Report", rubber raw materials occupy a large share of the filter raw materials market, accounting for approximately 30% of the total raw materials. Steel and filter paper respectively occupy 20% and 15% of the market share. In addition, other raw materials such as aluminium ingots also occupy a certain share of the filter raw material market.

In terms of suppliers, there are a large number of raw material suppliers for filters in China, but their scales are generally small. Among them, some large enterprises have gradually stood out in the market through technological innovation and quality improvement. These large enterprises are equipped with advanced production facilities and strict quality control systems, and are capable of providing high-quality raw materials to meet the demands of filter manufacturing enterprises.

• Midstream filter production

The midstream of filters mainly consists of the automotive filter production industry, which is responsible for the production and manufacturing of different types of automotive filters and other links. According to the data from the China Association of Automobile Manufacturers, there are a large number of automotive filter manufacturing enterprises in China, but their scales are generally small. Among them, some enterprises with technological, brand and scale advantages have gradually emerged and become industry leaders. These enterprises continuously enhance their market competitiveness through means such as technological innovation, quality improvement and market expansion.

During the production process, filter enterprises need to invest a large amount of human, material and financial resources. Among them, the cost of raw materials accounts for a large share of the production cost of the filter. To reduce production costs, some filter enterprises have begun to focus on the recycling and utilization of raw materials as well as energy conservation and emission reduction.

• Downstream application fields

The downstream of filters mainly covers application fields, including vehicle production, vehicle maintenance, and vehicle repair, among others. According to the statistics of the China Association of Automobile Manufacturers, the production and sales volume of automobiles in China in 2022 were 27.021 million and 26.864 million respectively. This provides a huge demand base for the filter market. Meanwhile, with the continuous increase in the number of cars and the improvement of consumers' awareness of car maintenance, the demand for filters in the market has also been growing steadily.

In the original equipment manufacturer (OEM) market, the demand for filters is mainly related to the production of new vehicles. Based on the calculation that each vehicle is equipped with one set of air filter assembly, one set of air conditioning filter assembly, one set of oil filter assembly and one set of fuel filter assembly when leaving the factory, the demand for filters in China's OEM market in 2022 was 108 million pieces. In the after-sales service market (AM market), the demand for filters is mainly related to the number of cars in possession. According to relevant data, the demand for automotive filters in the after-sales service market in China is approximately twice that of the OEM market.

The Chinese automotive filter industry has a huge market scale, a complete industrial chain, and broad market prospects and development space. In the future, with the continuous expansion of the automotive market and the improvement of consumers' awareness of car maintenance, the filter market will continue to maintain a growth trend. Meanwhile, the rapid development of the new energy vehicle market will also bring new growth opportunities to the filter market. For filter manufacturers, it is necessary to closely monitor market dynamics and changes in consumer demands, increase investment in research and development and technological innovation, and improve the performance and quality level of products to meet market demands.