Exterior Architectural Decorative Coatings

The economic slowdown has taken its toll on paint makers serving the exterior decorative coatings market. With fewer new homes and buildings under construction, the number of gallons of paint sold in key mature markets has fallen. To make matters more difficult paint makers are also plagued with high raw material costs. While they have stabilized a bit of late, the increases have far outpaced manufacturers ability to pass them along to customers. Increasing energy prices and ever more stringent environmental regulations are also challenges.

The market is also faced with continued customer and channel consolidation as well as manufacturer consolidation, which have a particular impact on smaller suppliers as they struggle to compete against global giants among fewer customers. The 20 largest paint makers, including PPG, DuPont and AkzoNobel, control more than 80% of the paint market.

According to consultancy Orr & Boss, architectural coatings accounted for an estimated 51% of the total global coatings volume in 2007. Exterior coatings represent approximately 35% of all architectural coatings, while interior coatings account for the remaining 65%. Th