Kansai Paint Renews Focus on Europe

Kansai Paint recently presented its eighteenth medium-term plan that outlines its strategy up until 2030. The most striking thing about it is that the company is putting Europe first and foremost for the remainder of the decade. In short, the strategy can be viewed as being built on four principles: decarbonization, circularity, quality of life and employment diversity.

The prominent visibility of Europe as a leader in sustainability and sustainable technologies is something that Kansai clearly wants to tap into and spread around the world through its other operations. The key objective for the company in Europe is the future development of innovative industrial coatings technology (and in Japan, similarly for automotive coatings).

Strong Growth and Past Development

The former Helios company operations, which already long enjoyed an enviable place for coatings supplies in central Europe, have grown rapidly – at 14.5% p.a. – since the company was acquired by Kansai Paint prior to 2018.

In the year of acquisition, it represented 12% of Kansai’s consolidated sales, whereas in 2024, it represented 19%, having outstripped the parent company’s collective growth of 6% p.a. over the same six-year period.

The star performer in Kansai’s global cast has, since then, been boosted by an array of supporting European industrial coatings acquisitions. It is currently the third-largest arm of the Kansai Paint group and has annual revenues of €737 million. It boasts 19 production sites in Europe, two in the Americas (one north, one south) and two in Asia.
By leveraging companies it has acquired (Weilburger and CWS), the objective is to achieve a turnover of €900 million by 2027. Some of this will be achieved as a matter of consolidation into the parent and the rest is expected to occur through global growth.

There are three main areas of activity at Kansai Helios: decorative paints, industrial coatings and performance chemicals. Of these, the industrial coatings portfolio has experienced the fastest growth (13.6% p.a.) with decorative paints recording the slowest (1.9% p.a.) since the time of acquisition.

Performance chemicals sandwich the two together with growth of 6.6% p.a. The Industrial Coatings operations accounted for almost three-quarters of Kansai Helios’ sales in 2024, as seen from the chart below.

European Coatings and Industrial Coatings Markets

The presentation gives a useful insight and perspective into matters around the European paint and coatings sector. In 2023, Europe was the second-largest regional market and accounted for 23% (US$ 44 billion) of the global paint and coatings market, which in that year was valued at US$ 195 billion.

In 2023 and before it acquired the Weilburger Coatings business, Kansai Helios had 1.6% of the European paint and coatings market, placing it ninth after most of the other major formulators. Kansai Paint also held a further 0.6% of the market through its non-Kansai Helios operations. The top ten paint companies operating in Europe now account for about 47% of all coatings demand, with the top two taking about 11% each.

When the figures are examined through the lens of industrial coatings only, the picture and outcome is different. Kansai Helios is then placed fifth in the European industrial coatings market with 2.9% share and other Kansai operations 0.9% (again, pre-Weilburger acquisition). The European industrial coatings market was valued at US$16 billion in 2023.

Innovative Technologies at the Heart of Strategy

Three leadership positions are now claimed in the European industrial coatings sector. In the overview, these emerge as follows:
• Railway coatings – leads and claims 20% of the market. Innovations here include polyaspartic clear coat technology.
• Core plate varnish – leads with 40% market share with key technologies being chromate-free and bonding core plate varnishes for EVs.
• High-temperature coatings – leads with 50% of the market and flourishing with polysiloxanes.
• Non-stick coatings – placed third, holding 13% share.
• Powder coatings – fifth place and with 5% and strengths in low-temperature curing polyester powders, also powder in powder solutions.
• ACE coatings – fifth place again but with 4%; this area benefits from ultra-high solids formulations and the use of polyaspartic clear coats once more.

All of the key technologies mentioned here minimize resource use, streamline the application process and reduce energy consumption. With the exception of the high-temperature coatings sector, each of the other five segments is expected to power Kansai Helios’ growth over the next three to six years.

Since the acquisition by the Japanese parent, the tentacular reach around the world has been exploited successfully. Pro forma turnover has doubled over the six years to 2024, with the share of global turnover being increased in Western Europe (40% rising to 50%) and more than doubling in Asia (3% to 7%). For the future, Kansai is relying on Helios to represent the third major pillar of business besides Japan and India.

More Japanese Activity in Europe with Chugoku

Meanwhile, Kansai Paint is not alone when it comes to Japanese companies growing in Europe. Chugoku Marine Paints recently announced that it is acquiring Italo Belge Colori S.r.l, an Italian coatings manufacturer of some 30 years standing. It plans to make Italo Belge Colori (ITB) a subsidiary of Chugoku Paints B.V. All of the shares were expected to be acquired by the Japanese company by Feb. 28, 2025.

The move boosts the ongoing growth of Chugoku Marine Paints in Europe; the business has been expanding its production volume at Chugoku Paints B.V., which it has in the Netherlands. Taking over ITB will give it a second manufacturing base in Europe, thereby adding further production capabilities and helping to reduce delivery times. It will also help Chugoku with a stepping stone to increase its European business more generally.