Europe Heat Treating Market Size, Share & Industry Analysis, By Process (Carburizing, Nitriding, Hardening & Tempering, Annealing, and Others), By Material (Steel, Cast Iron, and Others), By Equipment (Fuel Fired Furnace, Electrically Heated Furnace, and Others), By End-User (Automotive, Aerospace, Metalworking, Machine, Construction, Energy, and Others), and Regional Forecast, 2024-2032

The Europe heat treating market size was valued at USD 30.40 billion in 2023. The market is projected to be worth USD 31.74 billion in 2024 and reach USD 42.36 billion by 2032, exhibiting a CAGR of 3.67% during the forecast period.

The heat-treating method alters a material's physical and chemical properties. The heat-treating processes include annealing, case hardening, tempering, quenching, carburizing, and carbonitriding. The significant demand for metallurgical equipment in European countries, such as the U.K., Germany, France, and others, supported by maximum European industries for automobile, aerospace, construction, metalworking, energy, machine construction, and others, has created a strong demand for heat treating in the region. The metalworking industry is critical in moving toward a resource-efficient and low-carbon economy,  thereby aligning with the objectives of the EU's sustainable future strategy. Innovation and development across the automobile and aerospace sectors will contribute to the growth of the heat treating market.

The COVID-19 pandemic negatively impacted the heat treating market and led to disruptions in supply chains and project delays, profoundly affecting one of Europe's most critical metal industries. Since then, an entire branch of the heat treating industry has been converting and finding new ways to meet the current market conditions. European Union-wide production losses amounted to 4,243,577 vehicles, 22.9% of total EU production in 2019, including passenger cars, trucks, vans, and buses. As per the European Automobile Manufacturers Association, automobile sales fell by 55% in March, as lockdown measures were fully implemented in most countries.

Europe Heat Treating Market Trends

Growing Renewable Energy Sector to Create Opportunities for Market Growth

Offshore renewable energy projects, such as offshore wind and solar installations, require robust and durable components to withstand harsh marine environments. Heat treatment is essential in manufacturing critical components, such as turbine blades, tower sections, and foundation structures/solar piles. It enhances these components' mechanical properties and corrosion resistance, ensuring offshore durability and reliability.

Europe is among the world's leading offshore renewable energy industry markets. The growing demand for renewable energy solutions is driving market expansion on a global scale. Heat treatment companies may be able to enter new markets or expand their operations to serve renewable energy projects worldwide. This could involve partnerships with renewable energy developers, manufacturers, and contractors to provide tailored heat treatment solutions for their needs. As per WindEurope data, the European Union built 17 GW of new wind farms in 2023, of which 14 GW is onshore and 3 GW offshore. Renewables amounted to 44% of electricity produced in the EU. Wind power accounts for 19% of the electricity.

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Europe Heat Treating Market Growth Factors

Expanding Electric Vehicle Sector to Drive Demand for Heat Treatment

An automobile comprises various material components produced by utilizing multiple technologies that satisfy customer needs and environmental norms. Heat treatment and surface modification are the key technologies available in modern times to enhance the effective use of materials, achieve the desired properties of the components used in the automotive industries, save energy, and conserve natural resources.

Automobile manufacturing is a strategic industry in the E.U., where 13.1 million trucks, buses, vans, and cars are manufactured annually. The sector operates 164 vehicle assembly and production plants in the European Union. Over 13 million Europeans work in the auto industry, accounting for 7% of all E.U. jobs and approx. 3.4 million (11.5%) of E.U. manufacturing jobs are in the automotive sector. In 2023, E.U. car sales surged by almost 14%, with over 10.5 million new registrations, and battery-electric sales increased by 37%, with a 15% market share.

As of June 2023, the automotive sector generated turnover represents over 7% of the E.U.’s total GDP. The number of new electric car registrations has increased from 600 in 2010 to 1.74 million in 2021, over 18% of the new vehicle registrations. In 2022, over 22% of newly registered passenger cars were electric, 12.2% were battery-electric vehicles, and 9.4% were PHEVs (Plug-in hybrid electric vehicles).

Expanding Application Base Across Various End-Use Industries to Upsurge Demand for Heat Treatment Solutions

Heat treatment is a versatile and indispensable process in modern metallurgy and manufacturing. Its applications revolve around the aerospace and defense, medical sector, and consumer electronics, where it serves various purposes, including strengthening materials, increasing flexibility, reducing brittleness, and enhancing corrosion resistance. Heat treatment is vital for producing reliable and long-lasting products in different industries, from designing a high-performance engine to constructing a safe and durable building.

For instance, civil aeronautics is one of the leading high-tech sectors in E.U. Europe, and it is a world leader in the production of civil aircraft, including aircraft engines, helicopters, and components. It generates USD 141 billion in revenues and plays a significant role in exports. There are large aeronautical companies in Germany, France, Spain, and Italy. An extended supply chain of small and medium-sized European players characterizes the industry. The most recent estimates by the International Civil Aviation Organization (ICAO) estimate that demand for air transport will increase by an average of 4.3% per annum over the next 20 years, contributing 15.5 million direct jobs and USD 1.5 trillion of GDP to the world economy.

RESTRAINING FACTORS

High Energy Consumption and High Installation Cost to Hamper Market Growth

Heat treatment processes account for a large portion of energy consumption. Carburizing is a surface-hardening heat treatment process and is also one of the oldest heat treatments used globally. However, it has significant potential for improvement, owing to the large energy consumption associated with the long high-temperature heat treatment cycle time.

Energy consumed in the carburizing treatment is classified into furnace body radiation heat and the power for heating products, jigs, and atmosphere gas up to carburizing temperature and for heating the atmosphere gas for protecting products from the air. Among them, the energy consumption ratio of the furnace body radiation heat is the largest, 660% of the total energy consumption. Furnace body radiation heat does not contribute to the carburizing of products, wasting energy. Thus, this factor is the major restraint for the heat treating market.

Moreover, high installation costs and stringent environmental regulations on fuel-fired furnaces are other key market restraints. The heat treating industry is capital-intensive since it involves specialized equipment requiring a considerable investment in installation and maintenance. In addition, there are significant operating costs since it is an energy-intensive industry. Given these costs, heat treating becomes a substantial fraction of the overall production costs of many components.

Europe Heat Treating Market Segmentation Analysis

By Process Analysis

Hardening & Tempering Segment Leads the Market Due to the Rising Demand From Growing and Expanding Automotive and Railway Sectors 

Based on the process, the market is segmented into carburizing, nitriding, hardening & tempering, annealing, and others.

The hardening & tempering process segment dominates the market owing to the growing automobile industry and increasing demand for electric vehicles. Moreover, the increasing infrastructural development in the railway sector is expected to impact the segment growth positively. With the evolving machinery and equipment, the demand for bearings that withstand higher loads, harsh conditions, and prolonged use is rising. Carburized steel can fulfill these modern requirements as it offers a solution that enhances wear resistance and fatigue-bearing strength. Thus, these factors are increasing the demand for this segment.

The annealing heat treating segment is estimated to grow over the forecast period. Key variables driving the industry include an increase in the demand for different annealing forms, such as soft annealing stress relieving, within the automotive, semiconductor, and construction industries.

By Material Analysis

Heat Treatment is Employed Extensively on Steel, Leading to its Highest Growth Rate in the Market

Based on material, the market is segmented into steel, cast iron, and others.

The steel segment dominates the market and is expected to witness the highest growth rate owing to its high tensile strength and lightweight properties. Steel is the most important, multifunctional, and adaptable of all available materials, with low production cost. The use of steel in numerous end-user sectors and machining applications is increasing in several emerging economies, which is contributing to their industrial development.

Cast iron is an alloy of iron that contains 2-4% carbon, with different proportions of silicon and manganese and a few traces of impurities, such as phosphorus and sulfur. It manufactures internal combustion engine cylinder blocks, flywheels, gearbox cases, manifolds, and disk brake rotors in railways and other sectors. Owing to the surge in demand for improved railway connectivity, governments across the globe are investing in rail infrastructure improvement projects.

By Equipment Analysis

Electrically Heated Furnaces Dominates the Market Due to Its Enhanced Operational Efficiency and Environmental Sustainability

Based on equipment, the market is segmented into fuel-fired furnaces, electrically heated furnaces, and others.

Electrically heated furnaces segment dominates the market due to their high operational efficiency and greater environmental sustainability than conventional fuel-fired systems. They have automated temperature control and are easy to install, which improves operational efficiency.

Fuel-fired furnaces are one of the furnaces that combust fuel to release chemical energy as heat. In modern times, fuel-fired furnaces are gaining high preference due to their low cost compared to electrically heated furnaces. However, unstable fuel prices and greenhouse gas emissions have restrained the growth of conventional fuel-fired furnaces. Developing economies' demand for natural gas-fired furnaces will likely boost segment growth.

By End-User Analysis

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Automotive Sector Dominate the Market owing to the Widespread Adoption of Heat Treatment Across the Automotive Value Chain

Based on application, the market is classified into automotive, aerospace, metalworking, machine, construction, energy, and others.

Among these, the automotive segment accounted for a significant market share and is expected to maintain its dominance during the forecast period owing to rapidly increasing production of lightweight and other heavy vehicles across Europe. Heat treatment is significant for maintaining the structural integrity of modern cars and vehicles, such as electric vehicles. These factors are driving the demand for heat treatment in the automotive industry.

Aerospace is the second-most dominating segment and the fastest-growing industry. In this industry, heat treatment is utilized to improve the mechanical properties of metal parts, such as strength, hardness, and toughness. It is often performed in vacuum furnaces or in furnaces that use controlled atmospheres to prevent the oxidation or contamination of the metal. This factor makes aerospace the fastest-growing segment in the heat treating market.

COUNTRY INSIGHTS

Based on geography, the market has been analyzed across five key countries, including the U.K., Germany, France, Italy, Spain, Russia, and the rest of Europe.

Germany holds the dominant share in the region owing to the extensive presence of automobile and metallurgical industries. It is Europe’s biggest automotive market in production and sales, accounting for around 25% of all passenger cars manufactured and almost 20% of all new registrations. Germany also boasts the largest concentration of OEM plants in Europe.

The U.K. holds the second-biggest market in Europe for the heat treating market. U.K.’s aerospace industry is the second largest in the world, behind that of the U.S., and it is an export-driven industry. In 2022, U.K. civil aerospace turnover totaled approximately USD 34.5 billion. In 2022, the U.K. defense industry turnover totaled roughly USD 29 billion, USD 15 billion of which was exported.

Italy is also one of the fastest-growing markets for heat treatment. The automotive sector is one of Italy's primary industries. In 2022, the automotive sector’s turnover was around USD 95 billion, 9.3% of Italy’s manufacturing turnover and 5.2% of Italy’s GDP. The leading brands were the Stellantis Group (35.2% of the market), followed by the Volkswagen Group (16%), and the Renault Group (9.7%).

List of Key Companies in Europe Heat Treating Market

Key Market Players are Setting Their Strong Foothold with Expanding Their Operations

Since the last few years, the heat treating industry has continuously consolidated, giving rise to many small players. Hence, the market for heat treatment is highly competitive. Key players compete with companies that manufacture, distribute, and market furnaces and related products/services. Bodycote is a highly active organization in the industry and is engaged in several business transactions to maintain its leadership position. The company has a strong presence in the European market and is involved in expanding its operations across the globe.

List of Key Companies Profiled:

• Nabertherm GmbH (Germany)


• SECO/WARWICK Group (Poland)


• VASCHUK ltd (Bulgaria)


• Marimex - M. Ivanov (Bulgaria)


• Vizyon Heat (Turkey)


• Nitrex (Canada)


• Ajax Tocco Magnethermic Corporation (U.S.)


• Bodycote (U.K.)


• Hanomag (Germany)


• Aalberts Surface Technologies (Germany)

KEY INDUSTRY DEVELOPMENTS:

• May 2024- Nabertherm GmbH, headquartered in Germany, launched its new LH.DB range of compact sintering furnaces. This newly launched series set new standards in the heat treatment of ceramic parts and additively manufactured ceramic components on a laboratory scale. Moreover, it will help meet the heat post-processing requirements of additively manufactured components. The furnaces are available in two different sizes, with furnace volumes of 120 or 216 liters and maximum furnace temperatures of 1200 or 1300°C.


• March 2023- Aalberts Surface Technologies announced the expansion of its austempering capabilities and capacity in Canton, Ohio, and Ft. Smith, Ark. Three atmosphere-to-salt furnaces will be added to the existing facility in Canton,  allowing Aalberts to better serve customers in that region.


• September 2022- SECO/WARWICK Group signed a contract with GreenIron H2 AB (Swedish company) for producing furnaces for fossil-free metal production. These furnaces ordered by GreenIron will be used to recycle oxidized metals without emissions, and each furnace can reduce emissions by 56.000 metric tons/yr.


• March 2022- Aalberts Surface Technologies announced the rebranding of its U.S.-based businesses, which began as Aalberts Surface Technologies. The rebranding is part of a global rebranding initiative that Aalberts began in 2020. It includes changes to building signs, email addresses, websites, invoices, shipping documents, etc., thus reshaping the business segments across the U.S.


• February 2022- Aalberts Surface Technologies invested in additional equipment for their Dzierżoniów plant in Poland.  Under this, Aalberts Surface Technologies cooperates with SECO/WARWICK to avail tailor-made solutions that respond to their needs 100%. SECO/WARWICK will supply equipment such as furnaces to Aalberts Surface Technologies for the Poland heat treating plant.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product/service processes, and leading applications of the product. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.

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