The automotive market is impacted by a number of factors. First and foremost, the
global economy has a major effect on car buying. When the economy is growing, such as in China and throughout the Asia Pacific region, car and truck sales flourish. When the economy is struggling, such as in Europe and North America, people try to make their cars and trucks last longer. When the economy improves, people look to replace those vehicles.
The North American market has another factor at work in terms of auto sales. As a result of economic and political pressure, there has been a move for foreign automakers to produce some of their cars in North America, as car and truck buyers seek to purchase vehicles that are made domestically.
“The North American market has recovered quickly over the past two to three years, production is up 85% since 2009 and the U.S. is expected to sell 15 million units in 2013,” said Cynthia Niekamp, PPG senior vice president, automotive OEM coatings. “In 2013, PPG expects vehicle production growth of 2% in North America and 4% in South America, continued growth in the 7% range in Asia Pacific (excluding Japan). We expect the European region's growth to remain sluggish and not return to a growth mode until 2014. Overall we expect steady global growth in the three percent range.”
As automakers’ production and sales grow, so does the need for automotive coatings. Joe Schmondiuk, vice president – global accounts, BASF Coatings North America, noted that there is growth in automotive coatings, although that expansion is more regional in nature.
“There has been an increase in the number of vehicles being built in North America, and as production increases, this naturally helps OEM paint producers,” said Schmondiuk. “Europe is still struggling with its economy and is seeing less of an increase in automotive production, while Asia is in a growth mode, particularly in China. 2013 will see a continued improvement in growth and sales over 2012, but not as strong as recent years.”
Marc Michelsen, director communications and sustainability, AkzoNobel Automotive and Aerospace Coatings, noted that although it is hard to tell if auto sales are growing overall, there is pent-up demand for new cars.
“It’s hard for us to say,” said Michelsen. “But it’s reasonable to expect that after four very difficult years, some people who have put off buying a new car because of the economic uncertainties will finally decide to trade in what they’ve been driving for a new model. That should help OEMs. And of course, as a global company, we are well aware of the fact that the emerging markets have been growing even if it’s tough in Europe and North America. Even if China slows down from over 10% growth to 7% or 8% growth, it’s still a lot of new cars. However, our own involvement in the OEM markets in places like China and other emerging markets is small.”
AkzoNobel has seen some encouraging signs from its Automotive Plastic Coatings (APC) business. The company reported that last year for APC was its best year in North America.
“Besides providing paints for plastic parts, we have some fairly exclusive arrangements to provide coatings to a few high-end and specialty OEMs,” said Michelsen. “Undoubtedly, the most important one is with McLaren. That started out as a partnership to develop high-performance coatings for their Formula 1 race cars, but we have expanded the partnership and we’re now the exclusive provider of coatings for their road cars. Of course, McLaren is not a typical OEM, and the McLaren MP4-12C sports car is not a typical mass-produced motor car, so it doesn’t tell you much about the general OEM market. APC also provides coatings to Chrysler for its Viper – another high-end sports car. But in the rarified atmosphere of high performance sports cars – which can also serve as showcases for OEMs, there’s at least enough confidence to invest in some very exciting cars with bodies made of plastics and composites that require very different paints than what you get on the family car.”
Cars and trucks definitely are eye-catching, and one way that automakers look to expand their sales is through colors and special effects.
“An interesting development is the increasing use of multi-layer systems, where you have a ground color and then effect colors on top of that,” said Michelsen. “Technically, these systems present OEMs with some challenges, because their lines are not necessarily set up to apply multi-layer systems. The Tier 1 providers of parts – some of which are our APC customers – also need to adjust their production lines to accommodate these new systems. Two other trends worth mentioning are the trend towards matte finishes, though that’s more of a niche market, and the use of tinted clearcoat technology, which is something else that I think may grow in importance. Both GM and Ford have shown interest, so we’ll keep an eye on that.”
Automakers have been facing their own financial pressures due to the global economic downturn, and coatings can help them contain costs.
“Automakers are looking for improved efficiency in the coatings process so products that allow them to lower energy costs or shrink the footprint of the paint shop are most important,” said Schmondiuk. “That is why we are seeing the proliferation of coatings that eliminate an oven or part of the spray process. This trend will continue.”
Sustainability is another key trend. “The global OEMs are looking for sustainable solutions from their coatings suppliers--solutions that help them reduce waste and reduce their environmental footprint,” said Niekamp. “Sustainable coating products allow OEMs to improve the efficiency of their operations and improve the quality of their vehicles. The OEMs are under pressure to meet ever-more stringent environmental requirement for CO2 emissions, fuel efficiency and environmental regulations for both vehicles and production facilities. Coatings companies have stepped up to these challenges by offering advanced coatings systems that reduce material usage, improve throughput and reduce the environmental footprint. Examples of these coatings technologies include hyperthrow electrocoat primers and compact process decorative paints. These technologies allow OEMs to improve their sustainability through footprint and energy usage reductions, increase vehicle quality/performance while lowering overall production costs.”
When it comes to colors, automakers face an interesting dilemma: some people prefer to stick with the tried and true traditional palette, while other consumers want the latest options.
PPG consumer research has shown that consumers are looking for more color options in all of their purchases. “We expect to see more vibrant vehicle colors that offer a high degree of clarity and color depth,” said Niekamp. “Nanotechnologies such as the PPG Andaro pigmentation offer more chroma and a deeper, richer look than traditional pigments. Our consumer research shows that 78 percent of surveyed consumers prefer the richer look of colors created using PPG’s Andaro nano pigments versus conventional pigmentation.”
“One thing we see is the continuation of consumer preferences for fairly conservative colors like silver, black, white and gray,” said Michelsen. “White has been gaining in the recent years and could even become the number one choice in the near future. One reason for that, we think, is that white has more technical possibilities to be modified to have more effects and variations, so that the buyer feels that he or she is getting something quite distinctive.
“Once you get into true colors, blue seems to be the strongest, but reds and browns are gaining,” Michelsen added. “These ‘earth tones’ are stronger in Europe than they are in North America. What we see besides those conservative trends are trends towards more ‘brilliant’ colors, and more complex combinations with several pigments and effects that give a sense of depth.”
Paul Czornij, technical manger, BASF Coatings North America, also said that colors that evoke the environment are an area that consumers are showing interest.
“There is a continued emphasis for color directions that emphasize connection to the environment,” said Czornij. “Although this may be a somewhat evident trend, what we see is the development of natural looking colors such as greens and browns that evoke a gentler, caring statement about self. Other factors that impact color trends remain linked to technology and the ability to manage living in a world increasingly dominated by sophisticated gadgetry. The interest in silver, white and black color remains high as a result.
“In order to provide the options in color that is demanded by car buyers, coatings formulators again turn to a combination of high tech effect pigments and colorants to drive the color trend,” Czornij added. “Pigments that offer a higher degree of color saturation increase the feeling of depth and accent the three dimensional car body shapes. Highly developed chromatic blue, orange, reds and greens are being styled.”
Metallic effects are another popular option.
“Another ascending trend is the use of non-metallic colors either on the full body or in combinations with metallic coatings,” Czornij noted. “These metallic colors appear anywhere from very sparkling to pure and smooth, with just a hint of effect. In this way, colors appear to have different character depending on the time of the day or whether they are in direct sunlight or in shade.”
Coatings performance is critical to OEMs, whether it is beautiful, long-lasting colors or ease of application.
“Our customers are always looking for pretty much the same thing – they want paints that do what they promise,” said Michelsen. “So they want great colors and color consistency, smooth application characteristics and ultimately, that it looks great and continues to look great on the car. Because our specialty OEM customers are high-end, the colors they are looking for are usually very unique. We also see a much greater emphasis on sustainability than we have in the past, so they want waterborne paints or very low VOC paints, and fast-drying products that require less energy are important. With the McLaren F1 car, efficiency is extremely important, because they can’t wait around for the paint to dry while they are preparing for the next race. That carries over to some extent with the road car, where they have put an emphasis on weight, so they want few layers of paint.”
Automotive OEMs expect consistent and durable quality and performance globally. “PPG’s global reach allows us to provide consistent quality in all regions and across technologies,” said Niekamp. “These processes require a consistent and best practice approach and provide the customer with world-class technology wherever they operate in the world. It is important for automotive suppliers to be disciplined and high performing in all aspects of their business, from safety to flawless launches to consistent quality. In addition, the customer is expecting continuous improvement in coatings systems that lower manufacturing costs, simplify the manufacturing process and improve vehicle appearance and performance.”
“Customers are looking for innovative ways to lower costs and shrink their footprint without giving up quality,” said Alex Shimazaki, vice president – global accounts, BASF Coatings North America. “BASF has several things that fit that bill, such as our iGloss, ColorFuse and 3 Wet Process Technologies.
“One of our key customers, Nissan, uses the 3 Wet waterborne process for the production of its Infinity ‘J’ series and Nissan Pathfinder SUVs at its Smyrna, TN assembly plant,” said Shimazaki. “The process eliminates the need for a primer bake oven normally used between the primer and color-coating layers. The Smyrna manufacturing plant allows three layers of paint to be applied one after another while still wet before a single trip through the oven. Previous processes required the vehicle to bake in between the primer application and the topcoat layers. Implementation of this new technology reduces energy consumption, cost and emissions while increasing production efficiency.”
Susan Brennan, Nissan’s vice president of manufacturing in Smyrna, noted that improving energy efficiency is an important goal for her company.
“Nissan is committed to increase energy efficiency as we reduce the environmental impact of manufacturing the highest quality vehicles sold in North America,” said Brennan. “These efforts align with our global strategies of zero-emissions leadership and corporate social responsibility to employees, stakeholders and customers.”
The state-of-the-art facility sets new standards for quality, efficiency and environmental impacts, as it is capable of reducing energy consumption by 30%, carbon emissions by 30% and VOC emissions by 70%.
Another new high performance process from BASF is ColorFuse technology. This is an advanced coating technology that provides a highly efficient, integrated painting process via the integration or “fusion,” of the traditional basecoat and clearcoat into a single coating layer.
“It reduces the baking steps required from two to three,” added Shimazaki. “This technology reduces material usage and lowers VOC emissions while still providing excellent appearance, physical properties and outdoor durability. Lastly, we have our iGloss, which is a clearcoat that combines the advantages of inorganic ‘hard’ materials with those of organic ‘soft’ materials. The hybrid material delivers improved scratch resistance without increasing brittleness. The technology does not require any significant changes in the application process. The clearcoat offers better protection against microscratches, which you might get at the car wash for example, With iGloss, you can enjoy that new car effect for a much longer period of time.”