www.american-coatings-show.com 16 ; ;
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MARKET
energy savings (e.g., drying/curing with
lower energy), and multi-functionality
(e.g., combining aesthetic appeal and
anti-microbial properties, protective &
fire-resistant, etc.).
CHALLENGES IN MULTIPLE MARKET
SEGMENTS
ACA’s study finds that the U.S. paint
and coatings industry is expected to
reach a value of $25 billion in 2019. Ma-
jor trends and drivers will create chal-
lenges in multiple market segments
through 2019, to include:
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coatings;
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selling prices per gallon of coatings
as the result of persistently low energy prices;
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strong U.S. dollar on domestic ex-
ports; and
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mark short-term interest rate by the
Federal Reserve System, if the econ-
omy continues to improve (after an
unprecedented seven-year rate of
near zero percent at the start of the
Great Recession), affecting both vol-
ume and value in the domestic paint
and coatings market.
The study also features special chapters addressing industry mergers and
acquisitions, regulatory issues, and raw
material and technology trends.
The ACA Industry Market Analysis is a
valuable resource for a coatings stake-holder’s annual and five-year strategic
plan: it offers an industry structure assessment of each market segment using Porter’s “Five Forces” Analysis, and
allows for direct comparisons among
coatings market segments with regard to
their structural characteristics.
To learn more, or purchase
the “ACA Industry Market Analysis”,
go to www.paint.org/market.
Strong Performance Record Expected to Continue
MARKET EXPERTS SEE U.S. PAINT AND COATINGS INDUSTRY AT $25 BILLION IN 2019
; The U.S. coatings industry enters
2016 anticipating that its strong recent
performance record will continue. Pub-lically-traded U.S. coatings manufacturers have seen strong growth in valuation during the period of recovery from
the deep recession of 2008-09, and the
demand drivers for coatings have likewise experienced strong growth over
the past half-decade.
As the United States continues to
emerge from the effects of the Great
Recession, when both manufactured
goods output and construction spending declined sharply – not only in the
United States but around the world as
well – the paint and coatings market is
expected to respond to continued strong
performance of the manufacturing and
construction sectors with significant increases in both volume and value. The
combination of increased domestic demand and favorable export opportunities
will fuel the demand for increased U.S.
paint and coatings production.
MARKET STUDY COVERS
INDUSTRY’S CURRENT STATE
These and other important findings
are contained in the American Coatings
Association’s (ACA) newest edition of its
longstanding series, the ACA Industry
Market Analysis, 9th Edition (2014-2019).
This publication is the leading market
study covering the industry’s current
state, as well as forecasting its future.
The publication profiles the performance
of the coatings industry’s 19 market sectors, offers insightful analysis, and provides projections for sector performance
for the five-year period it covers. The new
ACA report, which also incorporates interviews with key industry experts whose
insights provide a solid base for analyzing the impact of trends and issues in
major market segments along the paint
and coatings supply chain, is the paint
and coatings industry’s go-to source for
executive business planning. The result
of this painstaking work is a detailed and
authoritative report of nearly 800 pages,
featuring approximately 500 separate
figures and tables.
ARCHITECTURAL SEGMENT LARGEST
COMPONENT OF COATINGS DEMAND
At 56 percent of the volume and 49
percent of the value in 2010, the architectural segment continues to account
for the largest component of U.S. paints
and coatings demand. The ACA Industry
Market Analysis projects a 2010-2015
Compound Annual Growth Rate (CAGR)
of 6.1 percent for value, and 2.9 percent
for volume in the architectural segment,
which will be aided by renewed strength
in construction, particularly in the residential housing market. This compares
with 4. 9 percent and 1.8 percent growth
in value and volume, respectively, for
Original Equipment Manufacturer (OEM),
and 3. 8 percent for value and 1.2 percent
for volume of Special Purpose finishes.
The architectural segment
will face both opportunities and challenges heading into 2016, with the use
of vinyl siding having lessened the need for exterior
architectural paint, which
is now offset by the growing market for fiber cement
siding. Since fiber cement
siding is likely to take market share from vinyl, this
should be a plus for the architectural paint segment.
OPTIMISTIC OUTLOOK
The outlook for OEM
coatings is generally up-
beat, too. The most critical
segment of the OEM coat-
ings category has tradi-
tionally been automotive
finishes, and that area
shows continued strength.
Motor vehicle production
has been quite strong
since the end of the reces-
sion and has been on a
consistently upward trajec-
tory since that time, lead-
ing to strong performances
by participants in this market. Other
manufacturing end-use markets have re-
covered since the end of the recession,
with not only motor vehicles performing
well, but also the aerospace market, re-
flecting strong demand for air travel and
upgrading and replacing of aircraft fleets
by carriers around the world.
POWDER COATINGS:
KEY PART OF OEM COATINGS
Powder coatings are a key part of OEM
coatings, and the 2014 value of powder
coatings redistributed across eight key
OEM market segments was $1,250 million on a volume of 400 million pounds
(with an equivalent gallon value of 76
million gallons, using a 5. 25 powder-pounds-per-gallon conversion factor).
Powder coatings accounted for approximately 6 percent of the volume and value
of the U.S. coating market. They are used
almost exclusively in OEM applications,
primarily in the transportation segments, appliances, wood and composition board flat-stock, metal buildings,
machinery and equipment, non-wood
furniture, fixture and business equipment, as well as in some industrial maintenance applications.
OPERATIONAL EFFICIENC Y IS A KEY DRIVER
A key driver for OEM coatings end users is operational efficiency. These are
things that improve productivity at customers’ painting operations, for example, wet-on-wet applications, reduced
labor, faster cycle times, etc. OEM end-users are running leaner operations than
ever before, meaning that productivity
and cost are huge factors. Coatings offering attributes that increase efficiency
will be at an advantage in this market.
These features – assuming they provide
equivalent performance – include the
necessity to use fewer coats, or at least
thinner films, faster drying and curing,
Figure 1: Global coatings demand.
Figure 2: U.S. volume and value by major market segment.
