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(Transportation-News.com, January 10, 2024 ) The automotive paints market is projected to grow from USD 8.4 billion in 2023 to USD 9.9 billion by 2028, at a CAGR of 3.2%. The key factors driving the automotive paints is increase in production of passenger cars, EVS and increase in sales of SUVs is driving. Also, there is increase in adoption for powder coating and water-borne coating technologies in automotive sector to reduce the environmental impact. Hence these factors is driving the automotive paints market.
Polyurethane resin is projected to have the highest demand in automotive paints market
Polyurethane-based coatings are popular in automotive OEM and refinish painting because they offer a unique combination of properties, this includes good elastic property at very low temperatures, solvent and water resistance, abrasion resistance, machine washability and dry cleanability. In addition to these benefits, polyurethane-based coatings do not increase paint thickness or change styling factors, such as drape. Also, with an increase in need of automotive paints by OEMs, the paint manufacturers have started investing in expanding their plant capacity for polyurethane resins. For instance, BASF SE has announced a single-digit million-euro investment in the capacity expansion of water-based polyurethane dispersions (PUDs) at its Castellbisbal site in Spain to increase the production capacity. Hence, polyurethane-based paints have the largest market in automotive paints market, by resin type.
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Passenger car is the second fastest growing segment in vehicle type for automotive paints market
Compact and mid-sized SUVs are among the most popular vehicle segments, and their demand is continuously growing. This has led to increased production of these vehicles, boosting the demand for automotive paints. These vehicles typically have a larger surface area than smaller cars, requiring more paint per vehicle. This has increased the consumption of automotive paints for these vehicle segments. Additionally, two-tone paints are becoming increasingly prevalent in compact and mid-sized SUVs, adding a more distinctive and customized look to these vehicles.
According to MarketsandMarkets Analysis, the global premium car segment under passenger car market is dominated by premium SUVs, which accounted for about 53% of total production in 2021 and grew to 62% in 2022 Developed countries such as the US, Canada, Japan, and South Korea hold the majority of the market, representing over 90% of global premium SUV production. For example, in 2021, the US produced luxury SUVs that comprised around 75% of its total luxury car production. Conversely, developing countries such as China, Brazil, and India have exhibited remarkable growth in SUV demand over the past few years. China and India’s SUV markets have grown by 36% and 10%, respectively, between 2018 and 2021. This growth in sales for SUVs is driving the market for passenger cars in the automotive paints market.
The global demand for passenger cars is expected to grow further due to the increased fuel efficiency of passenger cars, a rise in per capita income, increased employment opportunities, and efficient personal mobility solutions. The automotive industry is growing rapidly in countries such as China and India. Automotive manufacturers are increasingly investing in these countries due to the availability of affordable labor, robust infrastructure for production, and attractive government policies for the automotive industry.
In March 2022, Hyundai (South Korea) established its first production plant in the ASEAN region, marking a significant milestone in its expansion strategy. Situated in Cikarang, Indonesia, the facility represents a substantial investment of USD 1.55 billion and boasts an annual production capacity of 250,000 vehicles. This state-of-the-art plant will manufacture a range of new models, including the Creta, Santa Fe, Tucson, Stargazer, and IONIQ 5, all equipped with cutting-edge connectivity features to enhance the driving experience for customers across the region. Hence this factors has made passenger car the second fastest growing segment in automotive paints.
Asia Pacific to remain the fastest growing market for the for automotive paints
The Asia Pacific region is home to some of the world's largest and fastest-growing OEMs, particularly in countries like China, India, and South Korea. This rapid growth in vehicle production is driving the demand for automotive paints, as new vehicles require painting and existing vehicles need repainting to maintain their appearance and protect them from corrosion.
The Asia Pacific region is experiencing rapid urbanization and a growing middle class, leading to an increase in disposable incomes. This surge in purchasing power is fueling the demand for new vehicles, further boosting the demand for automotive paints. Additionally, the growing urbanization trend is leading to an increase in the number of car owners, which creates a need for aftermarket services like repainting and refinishing, further driving the demand for automotive paints.
The key players of automotive paints market are having collaboration and joint venture for catering to the increasing demand for automotive paints. For instance, PPG Industries and Kansai Paint announced the formation of a joint venture focused on the development, manufacture, and sale of automotive coatings. The joint venture, which will be headquartered in Shanghai, China, will leverage the complementary strengths of both companies to offer customers a comprehensive range of high-performance automotive coatings. The joint venture will also focus on research and development to develop new and innovative automotive coatings that meet customers' needs worldwide
Hence, the combination of a rapidly growing automotive industry, rising disposable incomes, stringent environmental regulations, and investments by OEMs and key players is driving the Asia Pacific region to become the fastest-growing market for automotive paints. The region's strong economic growth, increasing urbanization, and focus on sustainable practices are creating a favorable environment for the continued expansion of the automotive paints market in the coming years. Due to this reason the Asia Pacific region is the fastest growing region for automotive paints.
Major manufacturers in the Automotive paints market include
Key Players
Major manufacturers in the Automotive paints market include PPG Industries LLC. (US), Axalta Coating Systems LLC, (US), Akzo Nobel N.V. (Netherlands), BASF SE (Germany), The Sherwin Williams Company (US), Valspar (US), DOW Chemical (US), 3M (US), and KCC (South Korea).
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