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    Features

    Automotive Refinish Market

    The rise in use of self-driving and electric vehicles is having a major impact on the auto refinish market.

    Automotive Refinish Market
    photo caption: Steve Lagreca / Shutterstock.com
    Automotive Refinish Market
    Photo courtesy of PPG.
    Automotive Refinish Market
    Kerry Pianoforte, Editor09.30.19
    The global automotive refinish coatings market is expected to reach $11.34 billion by 2026, according to a new report by Reports and Data. This can be mainly associated with increasing disposable income, changing lifestyle and buying behavior of people and the demand for luxury vehicles from this segment.

    “The Vehicle Refinish market size and growth is generally governed by the car parc, accident rates and repair rates,” said Ed Hilborne, AkzoNobel’s global segment manager for Vehicle Refinishes. “The growth in the global car parc of circa 3.8 percent (per annum) is leading, but can be offset by other indicators such as driver aids known as Advanced Driver Assistance Systems (ADAS), road safety and legislation, leading to overall growth of crash repairs of around 2.5 percent.”

    Hilborne said  market drivers are regionally fragmented, with differences observed between mature and developing markets. “The mature European and North American markets are the largest in value and volume of repairs, but the balance is changing with the rapidly growing car population in Asia,” he continued. “It means over time the center of gravity will continue to shift. The regional car parc is predominantly influenced by the economic situation, and while China’s recent slowdown is significant, Asia overall will continue to strongly grow.”

    “We continue to see opportunity in the collision repair business,” observed Jane Niemi, North America marketing manager – Automotive Refinish at BASF. “As drivers, riders and pedestrians, we all benefit from the greater technology being put into cars to reduce accidents. Nevertheless, drivers need to stay alert because while there are fewer accidents, overall severity has averaged ~3 percent growth for the last 10 years, largely driven by the more expensive parts these repairs require. We are so proud that our top customers have grown at many times that, by working with our sales team to optimize product efficiencies as well as our value-added services to complement and energize their own business plans to complete quality repairs profitably.” 

    Trends and Challenges

    The advent of autonomous and electric cars is making waves in the auto refinish world.

    “As OEMs increasingly adopt the use of ADAS (advanced driver-assistance systems), body shops are consequently seeing an increase in the complexity and cost of repairs with the significant effort required to maintain and calibrate these systems in line with OEM specifications,” said Hilborne. “Additionally, the drive to reduce overall CO2 emission of vehicles through weight reduction, and the use in body sensors is resulting in the need for new repair coatings that can cope with light-weight multi-substrate vehicles while ensuring radar and lidar safety systems are not impacted.”

    According to Hilborne, a direct impact of ADAS is an expected trend towards smaller repairs – Thatcham is predicting a 14 percent increase in cosmetic repairs by 2020, and this will accelerate further towards 2025 as autonomy levels in vehicles increase.

    “Tightening of vehicle emission legislation, especially diesel particulates, has increased the number of battery and hybrid power trains in the general car population,” said Hilborne. “Collision repairs for these alternative fuel systems need to be handled in a different way, specifically curing of refinish coatings on these types of vehicles needs to be done at a much lower temperature to avoid permanent damage to battery systems.”

    Hilborne said he continues to see the overall number of body shops decline. “With the investment required to repair more complex vehicles, the consolidation of the repairer landscape with multisite, dealer groups and franchise body shops is growing, while the number of midsize body shops is declining. Increased HSE requirements and environmental legislation (VOC emissions reductions) are also resulting in the closure of smaller shops particularly in North Asia,” he said.

    He said auto refinish manufacturers are also seeing a strong move into cosmetic repair coming from allied automotive industries, rather than from traditional collision repair streams, where these activities can be aligned along with glass replacement, mechanical service, or specifically focused on serving the growing trend in automotive mobility services.

    “As business stakeholders and consumers, we are impacted by the advances toward autonomous,” said Niemi. “The Center for Automotive Research uses the term ACES – Autonomous – connected – electric – shared. This year it is estimated that 10 percent of cars on the road have telematics already, and that number is expected to be 25 percent by 2020. This increase means our labor force’s training and skills need to be evolving.

    “In addition to changing the nature of direct work on the car, research, scanning and post-repair calibration also add time to repairs yet are critical to fixing a car right the first time,” she added. “Understandably, all this adds to the labor and time that should be captured in an estimate as well as repair documentation that can aid in increasing the volume of proper repairs and increased profitability for the shop.”

    One thing that hasn’t changed in this industry is the importance of customer satisfaction. “Today, shops that are getting this right take communication with the customer as seriously as proper repair planning, and that include taking OE procedures into account at the time of estimating,” said Niemi. “This is quickly becoming the hallmark of a smooth-running collision repairer, as cars with more technology take longer to repair. Unfortunately, not everyone is getting this right as is evidenced by decreases in customer satisfaction indices. We continue to see the shops that don’t get this right closing or losing significant volumes, with more and more business being directed to the shops that have been more agile to respond to this environment that requires more efficient operations in order to keep customers happy. There is a connection here, and we regularly hear from customers that the biggest challenge facing their operation is finding and keeping skilled talent. At the same time, we see our most dynamic customers aligning all areas of the shop that impact customer satisfaction, and make no mistake, that is every department.”

    Key Issues

    Bodyshops are constantly focused on improved productivity and looking to reduce process times to enable a higher rate of repairs.

    AkzoNobel has recently launched a digital workshop production measurement system called Carbeat. This digital cloud-based tool enables the body shop to track work in progress, identify and eliminate bottlenecks and provide their customers with real-time repair status updates.

    “Using traditional coatings at lower temperatures to repair vehicles with battery and hybrid power trains significantly impacts performance and reduces body shop efficiency, thus slowing down the overall repair process,” said Hilborne. “At AkzoNobel, we have developed vehicle refinish coatings that are able to cure at significantly lower temperatures, along with low energy, no heat (using ultraviolet (UV) light) products, which has the double benefit of not only improving efficiency but also reducing energy consumption, CO2 emissions and costs.”

    According to Niemi, key factor shops need to be aware of in today’s market is the growing importance of the OEM. From parts to procedures, OEMs are increasingly becoming more vocal about the importance of safe and proper repairs.

    “As part of their customer-for-life strategy, they recognize the repair experience as an important touchpoint in a consumers’ ownership journey. OEMs are organizing collision repair networks to encourage proper repair of their vehicles. Shops in these networks are trained by the OE and understand the importance of employing the procedures and standards to return a car to safety,” said Niemi.

    With the rise of telematics, the OEMs can receive the first notice of loss at the time of a collision.  “More and more, they are stepping in to recommend repair locations before a tow truck arrives on the scene,” noted Niemi. “They are using this technology to provide a consumer with options to get the car fixed right. OEMs are advocating proper repairs and providing supporting documentation that repair procedures are non-negotiable, and we even see them going directly to consumers to increase customer awareness around the importance of choosing the right shop for a safe repair. We are always working with our customers to stay abreast of OE procedures and relevant certifications so they can repair cars the right way and form partnerships as a part of their cars-to-the-door strategy.”

    In recognizing this shift, BASF is stepping forward as leaders in OE expertise with a new product in its VisionPLUS suite of value-added services. “We know OEM certifications are expensive, which is why we’ve developed our OEM toolbox, to help our customers determine the right OEM certifications to invest in,” said Niemi. “Our OEM toolbox will be available to our sales team for advising customers on which OE certifications make sense to invest in based on their local markets and our competitive intelligence.”

    Ultraviolet light-curing products that do not require a heat source to initiate curing are gaining traction in the market. AkzoNobel has seen significant growth of its UV curing primer, Sikkens Autosurfacer UV, as this technology is especially suited to smaller area repairs (1 to 2 panels) and helps body shops maximize opportunities for the faster processing of these repairs.

    “Aspartic chemistry-based low-bake/air-dry products are also being developed,” said Hilborne. “AkzoNobel has recently launched Sikkens Autoclear Aerodry and Lesonal Ultra Air Clear – these clearcoat technologies are exceptionally flexible due to their ability to be cured at ambient temperatures, making them ideal for the refinish of hybrid/ electric vehicles as well as traditionally powered vehicles. Autoclear Aerodry was developed to help body shops maximize their productivity and need for flexibility. To free up space for another job, businesses can roll out the previous vehicle or panel after a five-minute flash-off and leave it to air dry for 45 minutes. But if meeting a tight deadline is the problem, body shops can opt for a five-minute bake at 60°C.”

    “Today’s game is all about increasing productivity and performance which drives quality repairs profitably,” said Niemi. “Our product development team is continually honing our product portfolio to increasing long-term product performance. Our sales representatives are committed to working with customers to have the perfect product mix that drives shop profitability through performance and inventory balancing, and our value-added services complement the product mix to assess and continually improve all processes in the repair operation and business plan.”

    Products that are favorites for BASF’s high-efficiency customers include its UV and DTM primers, Direct-to-plastic sealers, and low to no-bake clearcoats. With regards to clearcoat, BASF’s leading brand Glasurit recently launched Glasurit 923-230. “Many of our custom builders are using it,” said Niemi. “It is compliant coast to coast. Another recently launched favorite is Glasurit’s latest overall clear 923-210 – its gloss is truly stunning. In side by side comparisons with competitors, our Glasurit repairs stand out for performance and profitability.”

    PPG launched its premium ECS8X A-Chromatic Sealers for the U.S. and Canadian markets. Featuring an advanced PPG resin technology, the new sealers have been engineered to provide an exceptional foundation for PPG’s popular ENVIROBASE High Performance basecoat automotive refinish system.

    The ECS8X A-Chromatic Sealers offer all the characteristics that produce an enhanced overall finish, appearance and gloss. The new sealers are available in three A-Chromatic shades: G1 white, G5 gray and G7 dark gray, which can easily be blended into shades G3 and G6. Also, ECS8X A-Chromatic Sealers provide exceptional leveling and blend edge characteristics – the best available today – producing a smoother finish for the basecoat layer.

    “Collision centers using the ECS8X A-Chromatic Sealers will experience a noticeable enhancement in Envirobase High Performance results,” said Tim Jones, PPG manager, collision segment, automotive refinish. “These easy-to-use sealers have been specifically formulated to blend into our five A-Chromatic gray shades and to deliver a smooth surface that allows an invisible repair with minimal effort. This launch is the debut of an innovative product that, I believe, PPG customers will appreciate.”

    ECS8X A-Chromatic Sealers are ready to topcoat in just 15 minutes and can be applied over unsanded OEM e-coats, sanded original finishes and/or properly prepared and treated bare steel, aluminum, fiberglass and plastic. The sealers generate a level surface with minimal texture in the blend edge, which allows the Envirobase High Performance basecoat to lay flatter than previously. This results in a smooth transition from sealer coverage to the original color foundation and the look of an invisible repair. The improved foundation, coupled with the appropriate gray shade undercoat, will achieve an invisible repair with less basecoat material and maximize hold-out and final appearance.

    With their dynamic performance characteristics, the ECS8X A-Chromatic Sealers will replace the ECS2X and ECS6X sealers. The new sealers can be used with ECRXX reducers in all markets and are compatible with DELTRON DBC 2000 and GLOBAL REFINISH SYSTEM reducers in National Rule areas. 

    Environmentally Progressive Coatings Claim Their Spot

    A more green-conscious world demands responsible choices.

    With people more conscious of the impact we’re making on the environment, enterprising companies are moving ahead with new ideas and technology designed to respond to — and anticipate — customer demands for ecologically responsible products. Commercial coatings are not excluded from this progressive wave. Astute paint manufacturers, including PPG, are aware of the environmental concerns surrounding coatings and are developing premium products that deliver high-quality performance with reduced ecological impact.

    One of the issues that manufacturers are addressing is the reduction of volatile organic compounds (VOCs) –  the gases released into the atmosphere by chemicals used in many of the products we use every day –  including paint. Breathing VOCs can affect the environment and our health. Collision center painters and technicians are particularly vulnerable to VOC exposure because vehicles are painted in an enclosed booth and VOCs are emitted into the atmosphere while paint dries. Because of such concerns, authorities in certain areas of the United States and all of Canada have limited the concentrations of VOCs used in automotive and commercial coatings.

    Significant progress has been made on the automotive refinish side of the industry with waterborne basecoat  to reduce the impact of VOCs. The commercial transportation sector, traditionally dominated by solvent-based coatings, is a little more complex.

    Using solvents for paint delivery disperses higher levels of VOCs into the air than the more environmentally friendly water-based paints. However, the costs associated with transitioning a commercial repair facility or truck builder to a water-based paint system may be cost-prohibitive if it requires equipment or facility upgrades. In addition, solvent based paints are less susceptible to environmental conditions, such as temperature and humidity, which are key concerns for commercial customers. Consequently, solvent-based coatings are popular for commercial use.

    To tackle the matter of VOCs in the commercial sector, PPG drew upon its vast technological capabilities to create the DELFLEET ONE paint system, an ultra-low VOC line of premium undercoats, topcoats and clearcoats engineered for use throughout the commercial transportation industry. This complete and compact line of advanced coatings is specially formulated to address the demanding refinish needs of the commercial transportation industry. The innovative brand uses a new generation of proprietary technologies to provide dramatically reduced VOC levels without sacrificing product durability. At the same time, the Delfleet One system delivers enhanced levels of color excellence and efficiency.

    “This was a matter of listening to our customers, hearing what they wanted and addressing their requirements for a premium commercial coating, then going further by adding an ‘environmental’ aspect to the final product,” says J.J. Wirth, PPG segment manager, commercial coatings, U.S. and Canada. “While our objective is to deliver commercial coatings that are at the top of the quality and performance charts, we also have a responsibility to our communities. We engineered these next-generation coatings to deliver outstanding color matching, ease of use, increased productivity and the bonus of the commercial transportation industry’s lowest VOC emissions for a premium paint system with full color capability.”

    The PPG Delfleet One paint system features a 57% reduction in VOC emissions compared to a traditional solvent paint system, ensuring compliance with regulations in all regions of North America. The system includes the latest aluminum and pearl pigments to provide full color capability for direct gloss, basecoat and matte colors, all of which have a VOC of 1.5 pounds per gallon. The system’s clearcoats and primers have a VOC of 2.0 or fewer pounds per gallon. 

    “We believe our customers will appreciate the product capabilities and productivity boost offered by the most environmentally progressive premium system in the commercial transportation OEM and refinish markets,” adds Wirth.

    The compact paint system has 42 toners, four binders and four paint additives that reduce inventory requirements but still provide the resources needed to address all refinish or OEM work. In addition, the entire system is supported by PPG’s extensive color database that expands as new colors, special mixes and variant formulas emerge. It uses the exclusive PPG Delfleet One Tint Guide and the Delfleet One Color Deck, which houses thousands of OEM color chips and variants arranged chromatically. The system also ensures accurate color match through PPG’s cutting-edge color tools that include the RAPIDMATCH XI spectrophotometer, TOUCHMIX XI computer and PAINTMANAGER XI software.

    With the Delfleet One system, PPG has kept its eye on customer requirements while making sustainability a priority.
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