Adroit Market Research - Industry Insights

Automotive refinish coatings are applied to vehicles for improving the appearance of the vehicle and also enhance their overall durability and quality. Automotive refinish coatings also safeguard the vehicle from severe weather and external conditions like settling foreign particles, rain and extreme temperature and UV radiation. Growth in the production of vehicles in several countries like Mexico, China, India, Germany, South Korea, U.S, Japan and Indonesia with high maintenance of aging vehicles is the main driver responsible for the growth of this market. Demand for eco-friendly coatings like UV-cured and waterborne in economies of Brazil and China is also boosting this industry.

Automotive refinish coatings are applied to vehicles for improving the appearance of the vehicle and also enhance their overall durability and quality. Automotive refinish coatings also safeguard the vehicle from severe weather and external conditions like settling foreign particles, rain and extreme temperature and UV radiation. Growth in the production of vehicles in several countries like Mexico, China, India, Germany, South Korea, U.S, Japan and Indonesia with high maintenance of aging vehicles is the main driver responsible for the growth of this market. Demand for eco-friendly coatings like UV-cured and waterborne in economies of Brazil and China is also boosting this industry.

Evolution of Automotive Refinish Coatings in repair activities and vehicle maintenance:

Refinish coatings are the products that improve the appearance of the vehicles that undergo accidents and abrasion damages. In addition, refinish coatings safeguard the vehicle’s surface from the severe environmental conditions like UV exposure. Automotive refinish coatings display key features like sustainability, OEM color matching, quick cycle times and quick drying times that make them perfect for vehicle-related maintenance. Growth in the maintenance of vehicle and repair work in developed and developing countries is projected to fuel the demand for vehicle refinish coatings. Increasing disposable income all over the world, particularly in the Asia Pacific has boosted the demand for vehicle refinish coatings. The main reason for the rise in the prevalence of accidents is highways & safety rules and the absence of proper roads.

Shifting trends of consumer like increased popularity of cab services has fueled the demand for the maintenance of a vehicles. In addition, vehicle fleet augmenting the sales of pre-owned cars at steady speed has also grown by increasing the requirement for vehicle refinish coatings. Growing customer surplus and demand for modified vehicles is also anticipated to propel the demand for this market.

Automotive refinish coatings were mostly developed for damaged and used vehicles. As the ownership of the vehicles has drastically increased over time, road accidents have also increased. The distinctive causes of accidents are driving under the impact of alcohol, negligence in the usage of seat belts, distracted driving, reckless driving and speedy driving. Increase in the occurrence of road accidents is estimated to substantially and unfortunately contribute to the demand for automotive refinish coatings.

A rise in the demand for maintenance, vehicle modification and repair on the basis of increasing customer surplus, population, accidents and requirement for attractive aesthetics is expected to fuel the automotive refinish coatings market in the coming years. In addition, the rise in the spending on R&D activities and expansion of environment-friendly waterborne refinish coatings will boost the growth of the market in the upcoming years.

Regulatory Framework:

The U.S. Environment Protection Agency (EPA) announced Coatings & Composites Coordinated Rule Development (CCCR), which is involved in developing guidelines for several industrial surface coating operations and composite operations. The guidelines define national emission standards for toxic air pollutants under Section 112 of the Clean Air Act. EPA also released Quantifying the Disposal of Post-consumer Architectural Coating in 2007 that anticipates that around 10% of coating procured in the U.S. is eventually rejected. This study was declared at a national meeting of the Coating Product Stewardship Initiative that brought coating manufacturers, recyclers, EPA officials and representatives to find improved ways to accomplish leftover house coating.

U.S. EPA has set VOC content limits for automotive refinish coatings. For primers, the VOC content can be up to 4.8 pounds per gallon whereas, for topcoats, VOC content can be up to 5 pounds per gallon.

Clean Air Act of 1970

The Clean Air Act (CAA) standardizes air emissions from mobile and stationary sources. CAA law sanctions EPA to start National Ambient Air Quality Standards (NAAQS) to safeguard public welfare and public health to standardize the releases of harmful air pollutants. CAA act also states the setting up of National Emission Standards for Harmful Air Pollutants.

Automotive Refinish Coating: Technology

• Solvent-Borne Coatings:

Solvent-borne coatings comprise 25% solids and a relatively high organic solvent content. These coatings are generally applied with conventional air spray, which uses compressed air at high pressures to atomize paint, with a deployment of technology under the name, low-volume high-pressure (LVHP). Majorly used solvent coatings include aromatic hydrocarbons (trimethylbenzene, xylene and toluene), aliphatic hydrocarbons, methyl ethyl ketone (MEK), glycol ethers and methyl isobutyl ketone (MIBK). Solvent-borne coatings are highly combustible, high in odor and high in VOC emission. These coatings contain a high level of organic compounds that facilitate quick drying and formation of regular & durable paint films on automotive surfaces. Technological advancement in the solvent-borne technology which would reduce its harmful environmental impacts is a key factor which would drive the growth of this market.

• Water-Borne Coatings:

Waterborne coatings consist of approximately more than 80% of H2O content with small amounts of solvents comprising glycol ether. Extensively utilized waterborne coatings contain water-dispersible paints, water-soluble paints, emulsions and alkyds based on water. Adherence of regulations imposed in Europe and the U.S. relating to Volatile Organic Compounds (VOC) components in varnishes is probable to play an important role in fuelling the growth of waterborne coatings technology. The technology of waterborne is better as compared to the technology of solvent-borne on account of properties including environment-friendly nature, easier blending, accurate mixing, higher metallic control, greater opacity, reduced product required and slighter hazardous waste.

• UV Cured:

The increasing importance of ultraviolet protection in the automotive industry to inhibit the surfaces of metal and plastic parts from the harmful radiations has led to an upsurge in demand for UV-cured automotive coatings. Properties of UV-cured resins meet the demand for automotive applications including weather stability along with new lamp technology that delivers fast drying of paints and completes curing in less time. UV-cured technology is extensively used in automotive applications including scratch-proof coatings on interior & exterior components, anti-corrosion coatings on tanks & metal springs and conformal coating in control units. UV-cured coatings are solids by volume and contain no volatile organic compounds (VOCs) making them less lethal and more environment-friendly coating technology. The UV-cured coating products are put into words from a variety of resins including polyester, acrylates, polyurethane, epoxy providing specific coating properties including high abrasion resistance, flexibility, chemical resistance and hardness.

Sherwin-Williams Company: The Sherwin-Williams Company manufactures, develops, distributes and trades paints, coatings and associated products to industrial, professional, retail and commercial customers principally in North and South America, the Caribbean, Europe, Asia, and Australia. The company functions in three segments: The Performance Coatings Group, Americas Group and Consumer Brands Group. The Performance Coatings Group section offers industrial coatings for general industrial applications and wood finishing, automotive refinish products, marine and protective coatings, packaging and coil coatings, and colorants and performance-based resins; and specialty coatings through straight sales staff and representatives of outside sales to dealers, retailers, licensees, jobbers, and other third-party distributors. The Americas Group section offers marine and protective products, architectural paint and coatings, as well as OEM product finishes and related products through home centers, dealers, distributors, hardware stores, and other retailers. The Consumer Brands Group section delivers architectural stains, architectural paints, varnishes, wood finish products, industrial products, wood preservatives, corrosion inhibitors, applicators, caulks, aerosols and adhesives. The Sherwin-Williams Company was founded in 1866 and is headquartered in Cleveland, Ohio.

Valspar, in May 2017, acquainted by Sherwin Williams declared that development of manufacture capacities at Texas and Pittsburgh with the asset of about USD 10 Mn will increase its output around 200%.

Future Prospects:

Automotive refinish coatings market is an opportunistic market. Automotive refinish coatings technology has substantially developed from the past years with the emerging technology in four-wheelers. Currently, refinish coatings require to meet various necessities like durability under extreme conditions, quick settling time, and outstanding appearance amongst others because of which manufactures concentrate on the continuous development of the product. As automation in cars is evolving with introducing new technologies like self-drive cars and other new technologies, the necessity for refinishing coatings that are well-equipped with developing a technologies are a must.