GCC Heat Treating Market Size, Share & Trends Report

GCC Heat Treating Market Size, Share & Trends Analysis Report By Material (Steel, Cast Iron), By Process, By Equipment (Fuel-fired, Electrically Heated), By Application, And Segment Forecasts, 2019 - 2025

  • Published Date: Mar, 2019
  • Base Year for Estimate: 2018
  • Report ID: GVR-3-68038-070-5
  • Format: Electronic (PDF)
  • Historical Data: 2015 - 2017
  • Number of Pages: 105

Industry Insights

The GCC heat treating market size was valued USD 785.9 Million in 2018and is estimated to expand at a CAGR of 2.4% during the forecast period. Rise in demand for heat-treating units from numerous industrial applications, including automotive and aerospace, is expected to drive the market over the coming years. Prospective growth in crude steel production in emerging economies such as UAE and Saudi Arabia is also projected to spur market demand.

The rapidly growing automotive industry in Middle East and Africa is a key driver for the market. Prominent economies such as UAE and Saudi Arabia witness high demand for affordably priced vehicles owing to rapid urbanization, change in consumption trends, availability of affordable vehicles, strategic business targets of manufacturers, and changing lifestyles. Therefore, increased demand for passenger vehicles is predicted to facilitate demand for heat treating services and equipment in the region.

Saudi Arabia heat treating market

The Gulf region, including Qatar, UAE, Saudi Arabia, Bahrain, Kuwait, and Oman, have been traditionally considered tax-havens. However, since 2018, Gulf Cooperation Council (GCC) members signed an agreement to introduce a value-added tax (VAT) of 5.0% on the supply of goods and services. Stringent government regulations and framework in the metal treating market are expected to affect the overall market directly or indirectly.

GCC member states are expected to show moderate growth in terms of demand for heat treating. Presence of luxury automotive companies and rising investments in the regional aerospace industry are projected to favor market growth. Industrial automation, fueled by the trend of Industry 4.0, is expected to offer a competitive edge to manufacturers. Government intervention and favorable socioeconomic conditions are also expected to propel demand.

Material Insights

Heat-treating is an industrial process used to modify and improve various mechanical properties of materials, such as wear strength, fatigue resistance, and surface hardness. Materials treated include steel, cast iron, and others. The steel segment has experienced substantial growth over the past few years owing to favorable growth of the steel industry. Steel was the dominant segment in 2018, accounting for 60.91% share in the overall market, and this trend is projected to continue over the forecast period.

Increased use of other materials, including copper, aluminum, and brass, in various industrial sectors is projected to drive the others segment over the forecast period. Robust industrialization in the Gulf Cooperation Council owing to the liberalization of industrial policies has contributed to the promising demand for steel. Positive outlook in steel production and demand scenario has enabled it to dominate the market in the recent past.

Process Insights

By way of process, the GCC heat treating market has been segmented into hardening and tempering, case hardening, annealing, normalizing, and others. In terms of growth rate, the case hardening process is the fastest growing segment and is expected to register a CAGR of 3.10% over the forecast period.

However, hardening and tempering are some of the most commonly used processes for steel, cast iron, and other metal alloys. The segment is projected to grow at a significant rate on account of increasing use of these processes in various end-use industries such as automotive, manufacturing, energy, and construction. Surging automotive production in key economies and increased demand for reduction in overall weight of the vehicle are expected to drive segment growth over the forecast period.

Equipment Insights

By equipment type, the market is segmented into fuel-fired, electrically-heated, and other furnaces. In electrically-heated furnaces, heat is generated by passing electricity through the material or via induction, whereas in fuel-fired furnaces, heat is generated through the combustion of fossil fuels. The positive shift from traditional furnaces to electrical ones has favored market growth.

The market is anticipated to be driven by rising demand for processed metal in construction, automotive, and aerospace industries, specifically in Saudi Arabia and UAE. The fuel-fired furnace segment dominates the market and is expected to continue over the forecast period. Shifting consumer preference for natural gas-fired furnaces and rise in demand for heat treating equipment from numerous industrial application areas are projected to propel market growth by 2025.

Application Insights

Automotive was the largest application segment in terms of revenue, accounting for a 38.3% share in 2018. The sector is expected to be a major contributor to regional revenue growth by 2025 owing to increasing reach of various automotive manufacturers in Saudi Arabia, UAE, Oman, and other GCC member states. The automotive sector in the GCC is primarily fueled by high consumer disposable income, growing population, availability of various promising financing options from private players and governments, ongoing and upcoming infrastructure developments. All these factors subsequently benefit demand for heat treating solutions.

GCC heat treating market

The aerospace application segment is also projected to contribute significantly to the overall market. Considerable domestic demand for aircraft from member states such as UAE and Saudi Arabia has encouraged various international players to establish a production hub in the region. There has been steady growth of the GCC aviation and aerospace industry over the last two decades. Investments in space exploration have greatly benefited demand for aircraft parts, equipment, and services. UAE has been trying to establish itself as a regional center for commercial as well as civil space activities and this will have a positive impact on demand for heat treating services and equipment in the sector.

Regional Insights

Over the past few years, GCC countries have been among prominent revenue-generating countries in the global market for heat treating. Economic growth in member states like Saudi Arabia and UAE, along with technological investments, are projected to have a positive impact on the regional market. Saudi Arabia is anticipated to contribute significantly to revenue growth owing to the presence of luxury automotive companies, rising investments in aerospace, and several macroeconomic factors. In terms of revenue, the member state accounted for a share of 24.51% in the total market in 2018 and is expected to register a CAGR of 1.31% over the forecast period.

Qatar, Oman, and Bahrain are also projected to showcase steady growth in the market. This can be attributed to favorable government policies, positive outlook for taxes on imports and exports of goods, influx of foreign investors in MEA, and several other macroeconomic and socio-economic factors.

GCC Heat Treating Market Share Insights

The GCC market boasts of a strong competitive landscape made up of prominent players considering various business strategies, such as geographical extension and R&D efforts. Multinational companies have been focusing on several developing regions and countries of late, dedicating resources and investments in these markets. This also allows them to gain a competitive advantage over others and strengthen their market position.

Report Scope

Attribute

Details

Base year for estimation

2018

Actual/Historical data

2015 - 2017

Forecast period

2018 - 2025

Market representation

Revenue in USD Million, and CAGR from 2018 to 2025

Regional scope

Gulf Co-operation Council (GCC)

Country scope

Saudi Arabia, UAE, Bahrain, Oman, Qatar, Kuwait, Yemen

Report coverage

Revenue forecast, competitive landscape, growth factors, and trends

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Segments Covered in the Report

This report forecasts revenue growth at regional and country levels, and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the GCC heat treating market report based on material, process, equipment, application, and region:

  • Material Outlook (Revenue, USD Million, 2015 - 2025)

    • Steel

    • Cast Iron

    • Others

  • Process Outlook (Revenue, USD Million, 2015 - 2025)

    • Hardening & Tempering

    • Case Hardening

    • Annealing

    • Normalizing

    • Others

  • Equipment Outlook (Revenue, USD Million, 2015 - 2025)

    • Fuel-fired Furnace

    • Electrically-heated Furnace

    • Others

  • Application Outlook (Revenue, USD Million, 2015 - 2025)

    • Automotive

    • Aerospace

    • Metalworking

    • Machine

    • Construction

    • Others

  • Regional Outlook (Revenue, USD Million, 2015 - 2025)

    • Gulf Cooperation Council

      • Saudi Arabia

      • UAE

      • Oman

      • Qatar

      • Bahrain

      • Kuwait

      • Yemen

Key questions answered by the report
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