by Flexfuel, also known as flexible-fuel vehicles, are vehicles that run on more than one type of fuel such as gasoline, ethanol fuel, or methanol fuel. Flexfuel vehicles have an internal combustion engine designed to run on more than one fuel, usually gasoline blended with either ethanol or methanol fuel. The advantages of flexfuel vehicles include reduced greenhouse gas emissions as compared to gasoline, price stability against fluctuations in oil prices, and support for domestic agriculture. Flexfuel vehicles are predominantly used in Brazil, Canada, United States and some European countries where use of renewable fuels is promoted.
The global flexfuel market is estimated to be valued at US$ 93.57 Bn in 2023 and is expected to exhibit a CAGR of 9.2% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics
Growing demand for renewable energy sources: The growing demand for renewable and clean sources of energy due to stringent environmental regulations regarding carbon emissions is a major driver for the global flexfuel market. Ethanol derived from sugarcane and corn is one of the renewable alternatives for gasoline and use of flexfuel vehicles helps reduce dependence on fossil fuel based gasoline. government incentives and policies promoting use of biofuels: Governments across major flexfuel vehicle adopting countries offer incentives such as tax credits and waivers for purchase of flexfuel vehicles and production of biofuels like ethanol. This encourages auto manufacturers to produce more flexfuel compatible vehicles and fuel companies to set up biofuel blending infrastructure. Such policy support is expected to positively influence flexfuel vehicle adoption over the forecast period.
Segment Analysis:
The global flexfuel market is dominated by the ethanol segment which holds around 85% market share. Ethanol is widely used as a biofuel blended with gasoline. It is considered environment friendly and can be produced from renewable food sources such as corn, sugarcane etc. Countries like Brazil, United States are the major producers of ethanol and use flexfuel vehicles that can run on any blend of gasoline and ethanol up to 85% ethanol blend.
PEST Analysis:
Political: Governments across many countries are promoting the use of biofuels including ethanol through various policies and incentives to reduce dependence on fossil fuels and curb carbon emissions. Flexfuel vehicles allow using varied blend of ethanol and gasoline as per availability.
Economic: Being an agriculture based product, ethanol provides additional income to farmers. It also reduces import burden of crude oil for fuel needs. Lower fuel costs and good mileage of flexfuel vehicles attracts consumers.
Social: Use of biofuels is considered environment friendly. Flexfuel vehicles enable use of varied ethanol blend and thus support sustainability goals. However, use of food crops for fuel faces criticism over food versus fuel debate.
Technological: Modern flexfuel vehicles can smoothly run on any ethanol-gasoline blend ratio without any modification. Flexible fuel technology allows optimal performance across varied blend ratios through advanced fuel injection and ignition systems.
Key Takeaways:
Global Flexfuel Market Size is expected to witness high growth over the forecast period driven by supportive policies and initiatives towards increased use of biofuels globally.
Regional analysis:
The market is expected to be dominated by North America led by the United States where flexfuel vehicles have gained widespread popularity over the last decade. Brazil also has a well-established flexfuel market in South America aided by the countries focus on sugarcane ethanol production.
Key players:
Key players operating in the flexfuel market are Takara Bio Inc., ViaCyte Inc., PromoCell GmbH. These players are focusing on developing innovative flex fuel technologies and partnering with automakers to increase flexfuel vehicle adoption.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
