Aftermarket to Drive Sales While COVID-19 Impact Continues to Slowdown Opportunities
Increasing demand for automotive refinishing coatings for enhancing the vehicle look, and durability is expected to sustain sales in global automotive refinish coatings market. Their ability to offer effective protection to vehicles from damages due to harsh temperatures, and adverse UV radiation will also continue to uphold the performance of automotive refinish coatings market. Steady increase in vehicle registrations, and miles driven, especially in mature markets, will remain the major factors contributing toward stable growth of automotive refinish coatings market.
Demand for automotive refinish coating is governed by car parc, accident rates, scratch or repair large scale damages, maintenance rates, and aftermarket painting. Developments and innovations in coatings, such as high-tech eco-friendly coating materials having low solvent content is another factor fuelling the growth of the market. The market is driven by investments into new refinish coating manufacturing facilities as well as capacity expansion projects. The auto refinish market is impacted by a variety of factors including volatile organic compounds (VOC) legislation, lack of market growth, increased complexity, and collision centre consolidation. Moreover, rise in the use of self-driving cars, and electric vehicles will also have a major impact on the auto refinish industry.
Scarcity of labour, and disruption in supply chain of raw material/equipment/component has been the key challenging factor amid the course of pandemic. A majority of nations in the Middle East, Africa, and Latin America are still dependent on imports of refinish coating from other nations such as US, and China. The COVID-19 pandemic followed by lockdowns has impacted the import-export activities involving refinish coatings. This has resulted in delays and accumulation of backlog demand as well as a need for establishment of domestic refinish coating facilities in these regions.
Waterborne Refinish Coatings Set to Nab Additional Market Share
Waterborne coatings are widely preferred due to their eco-friendly nature. Another strong factor boosting their popularity, includes the continued concerns around the usage of toxic chemicals, and growing stringency of legislator measures against VOCs. The overall demand for solvent-borne coatings is expected to lose share in automotive refinish coatings market when compared to other formulations in the next few years. Solvent-based coatings, the conventional choice across industry, have been recently facing the backlash due to their high-VOC content, and government regulations mandating limited usage of toxic chemical-based formulations. Other formulations include UV-cured coatings. The specific automotive application where UV-cured coatings has become the standard technology is in the automotive forward lighting industry where UV coatings have been used for more than 15 years and now command a considerable share in automotive refinish coatings market.
High Growth Prospects Projected for Asia Pacific
Mature European, and North American markets continue to benefit from the highest number of repairs in terms of both value, and volume. However, the balance is changing with the rapidly growing car population in Asia Pacific. Car sales in China fell 92% in the first half of February 2020, which would have quite a lasting impact on the Chinese automotive industry. However, strategic developments, and capacity expansion projects are all set to work to the advantage of China’s automotive refinish coatings market space by 2025. China, the world’s biggest car market, will remain home to auto plants including General Motors, Honda, Nissan, Peugeot Group, and Renault.
In December 2019, BASF announced to double its capacity of automotive refinish coatings production at Jiangmen site, China. The facility will start production in the first half of 2022. In May 2020, BASF, and DiDi, the world’s leading mobile transportation platform, signed a strategic cooperation agreement in Hangzhou, Zhejiang Province, China. Under the agreement, BASF will provide DiDi with sustainable automotive refinish products developed at its research and production site in Jiangmen. Thus, post-COVID-19, there has been a significant rise in the utilisation rate for automotive refinish coating production plants in China. DiDi currently has 25 owned body and paint shops in China and will be expanding to more than 200 owned and franchised shops globally by the end of this year. DiDi’s fleet consists of 300,000 cars and is projected to reach one million in 2022. This is expected to be an exceptional development in favour of the Asia Pacific automotive refinish coatings market.
Global Automotive Refinish Coatings Market: Competitive Landscape
Top five players account for more than 50% of the global automotive refinish coating market. Globally, top two players involved in market are BASF SE, and AkzoNobel N.V., whereas the other prominent players include Coating Systems Ltd., PPG Industries Inc., The Sherwin-Williams Company, DowDuPont Inc., Kansai Paint Co., Ltd., and Nippon Paint Holdings Co. Ltd.
The Automotive Refinish Coatings Market Is Segmented As Below:
By Resin Type
By Coat Type
Key Elements Included In The Study: Global Automotive Refinish Coatings Market
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