Coatings World - October 2013

Kerry Pianoforte, Editor

China has become the world’s largest producer and con- sumer of coatings. According to a recent report, from January to November 2012, China’s coatings output reached 11. 4 million tons, with a year-on-year increase of 12.09 percent. This figure is expected to grow by 10 to 15 percent annually. According to IBISWorld’s Paint Manufacturing market research report, “Paint Manufacturing in China,” the Chinese paint market is set to grow 11 percent in 2013 to reach $52.2 billion in revenue. According to the report, strong performance in downstream industries has fueled 13. 4 percent annualized growth in the paint manufacturing industry in China over the five years through 2013.

As the paint, coatings, adhesives and sealants industries continue to grow in China, leading companies continue to invest heavily in this region.

AkzoNobel recently announced plans to invest a total of more than €50 million in China to build new manufacturing facilities for its powder coatings and decorative paints businesses, adding further momentum to the company’s strategic growth ambitions.

Both new facilities will be located in Chengdu with the powder facility scheduled to open in 2014 and the decorative paints site starting production in 2015.

The announcement follows the recent start-up of commercial production of Bermocoll cellulose derivatives at the company’s multi-site in Ningbo, which will serve the growing demand from customers throughout the region, as well as from AkzoNobel’s own decorative paints business. Cellulose derivatives are used in water-based paints and building additives applications.

“China is playing an increasingly important role in our growth strategy and by expanding production capacity we will further strengthen our position as a leading supplier to the Chinese market,” said AkzoNobel CEO Ton Büchner.

“We already have a strong manufacturing footprint in eastern,
central and southern China,” he added. “As demand and volumes
continue to rise, we will extend our production and distribution
westwards and the new sites will enable us to better serve our
customers whenever and wherever they need our products.”
Chengdu is one of the fastest growing cities in south western
China and has consistently delivered double digit growth over
the last two decades. It has established itself as an important
industrial hub, resulting in high demand for quality powder
coatings and decorative paint, which is expected to remain
strong as the area continues to develop.
“Our investments in Chengdu underline our commitment to
further developing our business in China and capitalizing on
the business opportunities being created by growing domestic
demand,” said Lin Liangqi, president of AkzoNobel in China.

AkzoNobel currently employs more than 7,700 people in China, including 500 in research and development. Revenue for 2012 was €1.7 billion, the majority being generated from local demand.

Auto Sales in China Continue to Climb China’s passenger-vehicle sales gained the most in four months in August, led by sales of sport utility vehicles, as the world’s sec-ond-biggest economy rebounds from a two-quarter slowdown, according to a recent report by Bloomberg News. Wholesale deliveries of cars, multipurpose and sport utility vehicles climbed 11 percent to 1.35 million units last month, the biggest gain since April, according to the China Association of Automobile Manufacturers.

Total sales of vehicles, including buses and trucks, gained 10 percent to 1.65 million units last month, the association said. In the first eight months of the year, 13. 9 million vehicles were delivered, putting sales on track to reach the 20 million units estimated by the association.

Sales of SUVs jumped 46 percent to 240,100 units last month, while deliveries of multipurpose vehicles increased 162 percent to

105,600 units. Sedan deliveries gained 4 percent to 899,100 vehicles.
As a result of the surging automotive market, automotive
coating manufacturers are expanding their presence in China.
Business Development Asia LLC recently announced that its cli-
ent, The Sherwin-Williams Company, has acquired 100 percent of
Changzhou Pulanna Coating Co., Ltd. Pulanna is a leading manu-
facturer of automotive coatings for sale in the Chinese aftermarket.
The acquisition increases Sherwin-Williams’ presence in China’s
automotive sector where passenger car sales have grown strongly
in recent years, increasing from 6. 8 million in 2008 to more than
16 million in 2012. Car sales are forecast to continue rising at an
annual rate of approximately 10 percent for the next decade.