Charles W. Thurston, Latin America Correspondent02.16.22
Brazil’s demand for powder coatings is warming due to returning growth in the economy, including automotive, industrial and consumer goods segments.
PPG’s recent announcement of a 40% capacity increase in its Sumaré, Sao Paulo state manufacturing plant identified a broad set of markets for its powder coatings in “the home appliance, agriculture, transportation and general finishing industries, which encompass steel furniture, storage structures, gym equipment, electrical panels and power transformers,” according to a company statement.
The new $2.7 million investment follows a $40 million expansion of the company’s Sumaré facility in 2014. PPG also operates manufacturing facilities in Gravatai, Rio Grande do Sul state, in Pinhais, Paraná state, and in Américo Brasiliense, in São Paulo state.
“Compared to pre-pandemic levels, PPG is growing at a double-digit rate thanks to several segments that are growing at a fast pace. These include heavy duty equipment and transportation, commercial and light vehicles —such as trucks, buses and pickups — and residential and commercial appliances,” Paulo Teixeira, PPG’s business director for Industrial Coatings, Latin America South, told CW.
“Other strong segments, including architectural construction, auto parts and general finishes, are demonstrating good recovery as well,” Teixeira said.
“Due to a weak domestic currency, multinational companies are having good opportunities to explore markets that were not possible in the past,” Teixeira adds.
Equipment and Transportation Drive Demand
“Some of the main segments that are growing above the market rate are the heavy-duty equipment segment related to agriculture business and the truck transportation segment,” said Teixeira. “The truck segment grew 43% last year compared to 2020 volumes, according to figures from the Federação Nacional da Distribuição de Veículos Automotores, the Brazilian association of vehicle distributors (Fenabrave),” said Teixeira.
During the first 11 months of 2021, Brazil’s overall industrial activity rose 4.7% over the prior year period, according to the Instituto Brasileiro de Geografia e Estatística (IBGE), the national statistics agency.
Regional Export Opportunities
Brazil is still the largest economy in Latin America with a GDP value of $1.4 trillion, according to Statista. As such, it’s the largest market in the region for paints and coatings, especially for the 70 million households in the country. Prior to the pandemic, the Associação Brasileira dos Fabricantes de Tintas (Abrafati), the Brazilian coatings manufacturers association, estimated the domestic production of paint and coatings at more than 1.5 billion liters per year, with an industry sales total close to $8 billion, reflecting an average per capita consumption of about seven liters.
Since Brazil is a regional source for powder coatings, manufacturers often plan on exports as part of their capacity planning. “Brazil still continues as our main target market. But we have interesting, growing opportunities in various countries in South America, including Argentina, Colombia, Ecuador and Chile,” Teixeira said.
Part of PPG’s regional business has emerged from the 2007 acquisition of the architectural and industrial coatings businesses of Renner Sayerlack, based in Gravatai, Rio Grande do Sul state. Renner Sayerlack operates manufacturing plants and distribution centers in Gravatai, in Santiago, Chile, and in Montevideo, Uruguay. The company sells through independent dealers, construction material suppliers and brand licensees, similar to franchise stores.
Sustainability Efforts Parallel Business Growth
At the same time PPG builds its paint and coatings businesses in Brazil, the company makes substantial effort to support the communities around it through a broad sustainability program.
“PPG Brasil is committed to the sustainability goals of the global company. We have aggressive objectives to reduce energy consumption, to use renewable energy, and to reduce the intensity of emissions, in addition to goals in relation to the commercialization of sustainable products,” said Teixeira.
“We also expect to reach a new level in sustainability in the Brazilian automotive industry and in other large metallurgical industries. For example, in November we launched a low temperature pre-treatment that reduces energy consumption by up to 50% in the processing of metallic substrates that receive painting,” Teixeira said. “This process is just one part of PPG’s continuous effort to offer cutting edge technology and sustainable solutions to the Brazilian and Latin American markets,” he said.
“In terms of institutional governance, PPG obtained the Pro-Ethics Seal in December, for the second consecutive biennium,” Teixeira said. “This is granted by the Comptroller General, in recognition of companies with active anti-corruption practices,” he said.
The Ministry of Transparency and the Comptroller General of the Union (CGU) promote ethical business conduct throughout Brazil, granting the Pro-Ethics seal to companies that demonstrate lawful business practices and operate with the highest level of fairness, transparency and integrity.
Community Outreach with Color
One way that PPG serves as a good corporate citizen in Brazil is through the donation of paint for homes and businesses. “PPG Brazil is in line with the parent company’s philosophy of support and community engagement activities. Our Colorful Communities is a global flagship initiative that aims to revitalize and brighten community spaces using volunteer work and company products, primarily in educational spaces,” Teixeira said.
“In Brazil, we completed three projects in 2021 and have completed 16 in total since 2016. These projects impacted thousands of people and mobilized hundreds of volunteers from the company, from customers and from the community,” Teixeira said. Worldwide, PPG has carried out more than 380 projects, impacting 6.8 million people in 42 countries, he notes.
Education and Arts Support
PPG Brasil also is an active supporter of education and a patron of the arts.
“In the education field, we are especially focused on STEM careers (science, technology, engineering and mathematics), for which we have a partnership with Junior Achievement, which promotes projects of innovation, entrepreneurship and financial education for young students in Brazil,” Teixeira said.
“We are now on the eve of launching a year-long stimulus program for girls from low-income families in public schools to enter technology careers. It will be centered in a public school in Sumaré, the city that houses PPG’s main plant in Brazil,” Teixeira said.
“We also donate products and equipment to entities like Esperança Sem Limites (Hope Without Limits) that offer technical training in body shops and in painting, to support the insertion of young people into the job market,” said Teixeira.
“PPG also supports and invests in culture and sports; we provide book donations, support theatrical performances, cultural events, and theater workshops,” Teixeira said.
“Similarly, we support sustainability workshops and graffiti (mural) classes, among other projects for children and for young people in the communities around our manufacturing plants,” he said.
“Since 2013, over 20,000 young people in the country have been impacted by our programs, including more than 3,000 in 2021 alone,” Teixeira said.
PPG’s recent announcement of a 40% capacity increase in its Sumaré, Sao Paulo state manufacturing plant identified a broad set of markets for its powder coatings in “the home appliance, agriculture, transportation and general finishing industries, which encompass steel furniture, storage structures, gym equipment, electrical panels and power transformers,” according to a company statement.
The new $2.7 million investment follows a $40 million expansion of the company’s Sumaré facility in 2014. PPG also operates manufacturing facilities in Gravatai, Rio Grande do Sul state, in Pinhais, Paraná state, and in Américo Brasiliense, in São Paulo state.
“Compared to pre-pandemic levels, PPG is growing at a double-digit rate thanks to several segments that are growing at a fast pace. These include heavy duty equipment and transportation, commercial and light vehicles —such as trucks, buses and pickups — and residential and commercial appliances,” Paulo Teixeira, PPG’s business director for Industrial Coatings, Latin America South, told CW.
“Other strong segments, including architectural construction, auto parts and general finishes, are demonstrating good recovery as well,” Teixeira said.
“Due to a weak domestic currency, multinational companies are having good opportunities to explore markets that were not possible in the past,” Teixeira adds.
Equipment and Transportation Drive Demand
“Some of the main segments that are growing above the market rate are the heavy-duty equipment segment related to agriculture business and the truck transportation segment,” said Teixeira. “The truck segment grew 43% last year compared to 2020 volumes, according to figures from the Federação Nacional da Distribuição de Veículos Automotores, the Brazilian association of vehicle distributors (Fenabrave),” said Teixeira.
During the first 11 months of 2021, Brazil’s overall industrial activity rose 4.7% over the prior year period, according to the Instituto Brasileiro de Geografia e Estatística (IBGE), the national statistics agency.
Regional Export Opportunities
Brazil is still the largest economy in Latin America with a GDP value of $1.4 trillion, according to Statista. As such, it’s the largest market in the region for paints and coatings, especially for the 70 million households in the country. Prior to the pandemic, the Associação Brasileira dos Fabricantes de Tintas (Abrafati), the Brazilian coatings manufacturers association, estimated the domestic production of paint and coatings at more than 1.5 billion liters per year, with an industry sales total close to $8 billion, reflecting an average per capita consumption of about seven liters.
Since Brazil is a regional source for powder coatings, manufacturers often plan on exports as part of their capacity planning. “Brazil still continues as our main target market. But we have interesting, growing opportunities in various countries in South America, including Argentina, Colombia, Ecuador and Chile,” Teixeira said.
Part of PPG’s regional business has emerged from the 2007 acquisition of the architectural and industrial coatings businesses of Renner Sayerlack, based in Gravatai, Rio Grande do Sul state. Renner Sayerlack operates manufacturing plants and distribution centers in Gravatai, in Santiago, Chile, and in Montevideo, Uruguay. The company sells through independent dealers, construction material suppliers and brand licensees, similar to franchise stores.
Sustainability Efforts Parallel Business Growth
At the same time PPG builds its paint and coatings businesses in Brazil, the company makes substantial effort to support the communities around it through a broad sustainability program.
“PPG Brasil is committed to the sustainability goals of the global company. We have aggressive objectives to reduce energy consumption, to use renewable energy, and to reduce the intensity of emissions, in addition to goals in relation to the commercialization of sustainable products,” said Teixeira.
“We also expect to reach a new level in sustainability in the Brazilian automotive industry and in other large metallurgical industries. For example, in November we launched a low temperature pre-treatment that reduces energy consumption by up to 50% in the processing of metallic substrates that receive painting,” Teixeira said. “This process is just one part of PPG’s continuous effort to offer cutting edge technology and sustainable solutions to the Brazilian and Latin American markets,” he said.
“In terms of institutional governance, PPG obtained the Pro-Ethics Seal in December, for the second consecutive biennium,” Teixeira said. “This is granted by the Comptroller General, in recognition of companies with active anti-corruption practices,” he said.
The Ministry of Transparency and the Comptroller General of the Union (CGU) promote ethical business conduct throughout Brazil, granting the Pro-Ethics seal to companies that demonstrate lawful business practices and operate with the highest level of fairness, transparency and integrity.
Community Outreach with Color
One way that PPG serves as a good corporate citizen in Brazil is through the donation of paint for homes and businesses. “PPG Brazil is in line with the parent company’s philosophy of support and community engagement activities. Our Colorful Communities is a global flagship initiative that aims to revitalize and brighten community spaces using volunteer work and company products, primarily in educational spaces,” Teixeira said.
“In Brazil, we completed three projects in 2021 and have completed 16 in total since 2016. These projects impacted thousands of people and mobilized hundreds of volunteers from the company, from customers and from the community,” Teixeira said. Worldwide, PPG has carried out more than 380 projects, impacting 6.8 million people in 42 countries, he notes.
Education and Arts Support
PPG Brasil also is an active supporter of education and a patron of the arts.
“In the education field, we are especially focused on STEM careers (science, technology, engineering and mathematics), for which we have a partnership with Junior Achievement, which promotes projects of innovation, entrepreneurship and financial education for young students in Brazil,” Teixeira said.
“We are now on the eve of launching a year-long stimulus program for girls from low-income families in public schools to enter technology careers. It will be centered in a public school in Sumaré, the city that houses PPG’s main plant in Brazil,” Teixeira said.
“We also donate products and equipment to entities like Esperança Sem Limites (Hope Without Limits) that offer technical training in body shops and in painting, to support the insertion of young people into the job market,” said Teixeira.
“PPG also supports and invests in culture and sports; we provide book donations, support theatrical performances, cultural events, and theater workshops,” Teixeira said.
“Similarly, we support sustainability workshops and graffiti (mural) classes, among other projects for children and for young people in the communities around our manufacturing plants,” he said.
“Since 2013, over 20,000 young people in the country have been impacted by our programs, including more than 3,000 in 2021 alone,” Teixeira said.