The Automotive Coatings Market

There’s a lot to choose from when it comes to selecting a vehicle. The buyer will consider between car brands, the model of car from SUV and truck to compacts and hybrids, weigh the importance of miles per gallon vs. size of the vehicle, and, yes, the color of the vehicle.

However, the coatings on your car, truck or motorcycle are doing much more than providing color. They also protect the vehicle from corrosion and chemicals, and functional coatings are coming that can do more than just protect the vehicle.

In speaking with automotive coatings leaders, 2024 was a solid year, with the Asia-Pacific region enjoying the greatest growth.

Gustavo Carvalho, automotive key account manager and segment director, AkzoNobel Powder Coatings, observed that the global automotive OEM coatings market in 2024 experienced significant shifts.

“While the industry overall faced economic challenges, particularly in Europe and North America, due to high interest rates and supply chain disruptions, the Asia-Pacific region – especially China – witnessed notable growth,” Carvalho pointed out. “Chinese OEMs expanded their market share in the EMEA region and are expected to begin local production in Europe by 2026. This shift has had an impact on coatings manufacturers, both liquid and powder coatings, who must adapt to new competitive pressures, sustainability requirements and technological advancements.

“In addition, there’s an increasing trend towards ‘near-shoring’, where both vehicle OEMs and Tier suppliers are striving for localized production,” added Carvalho. “This strategy supports supply chain resilience, cost efficiency and sustainability goals, aligning with regulatory and market expectations.”

Rachel Choo, VP global marketing Automotive OEM Coatings at BASF Coatings, noted that global vehicle production in the automotive industry decreased by 2% in 2024, but despite mixed market conditions globally and ongoing economic challenges, BASF Coatings achieved solid results and performed at generally the same level as the previous year.

“We largely compensated for the declining volume in the automotive industry through increased sales in the surface technology sector,” Choo added. “Staying close to our customers and focusing on what they value – along with a more global management of our operations – are key success factors.”

Alisha Bellezza, PPG senior vice president, Automotive Coatings, observed that 2024 was another dynamic year in the automotive industry.

“We continued to see an inconsistent raw material supply, which has pushed us toward an even more proactive approach in managing our inventory and supplier relationships. We continue to learn so that we can quickly adapt to any disruptions and minimize their impact on our operations,” Bellezza said.

“Additionally, economic conditions have resulted in uneven demand around the world,” added Bellezza. “This unpredictability has necessitated more manufacturing and supply chain adjustments and heightened our focus on the quality, reliability and safety of our products and services to support our customers. We are proud that we have been able to maintain operational efficiency and ensure that customer satisfaction remains our number one priority.”

Bellezza also pointed to the importance of innovation in the automotive coatings market.

“In 2024, we also saw a heightened focus on innovation, especially the evolution of the paint shop of the future,” Bellezza said. “Companies are now embracing established technologies that were previously underutilized, and they are also exploring new innovations aimed at enhancing sustainability and productivity benefits even more. This increased interest in bolder technologies demonstrates a strong commitment to sustainability and efficiency, which are increasingly important as we see new entrants gaining ground over traditional players.”

Regional Growth

As Carvalho mentioned, the most significant growth continues to be in Asia, particularly China, but he also reported that the other regions are seeing some growth.

“Europe is also seeing investments in automotive production, with countries such as Hungary attracting new manufacturing facilities,” Carvalho said. “Meanwhile, North America remains a steady but challenging market due to fluctuating demand and economic constraints.”

Choo pointed out that the trend toward electric vehicles has significantly accelerated with different speeds in the regions.

“The automotive industry is currently growing primarily in the largest region, Asia-Pacific, and new Chinese manufacturers such as BYD conquer markets inside and outside their country,” Choo observed. “Accordingly, BASF has expanded its market position there in recent years through strategic investments. Europe, like North America, remains an important market for us. In the refinish coatings industry, we are currently seeing a consolidation of workshops in many regions, which we are supporting as a reliable global premium coatings partner.”

“As we look at the auto sector in general, we continue to deliver total system solutions for our OEM and Tier supplier customers – from substrate pretreatment to beautiful colors and protective clearcoats – inside and outside the vehicle, and across a variety of automotive parts and accessories,” Bellezza said. “We are optimistic about the prospects for 2025.”

Bellezza noted that PPG is aggressively investing in new technologies and capacity as a demonstration of its commitment to the industry.
“By prioritizing innovation, advancing color development, and committing to sustainability, we are well positioned to introduce industry-leading technologies aligned with our customers’ needs,” she said.

“Even as the industry was impacted with overall lower global production volumes and supply chain challenges, we remained close to our customers throughout the year and delivered in all markets,” Bellezza noted. “We earned strong share gains in both Latin America and Asia-Pacific, specifically in China. As we outlined in our 2024 earnings report, automotive production was lower year-over-year in the U.S. and Europe and our results followed that lower demand trend. However, we were able to partially offset the decline in sales volumes through share gains in the previously mentioned markets.”

Key Areas of Interest

There are significant trends that are occurring in the automotive industry, including interest in sustainability and cost optimization, and these areas are also being explored by coating manufacturers. BASF’s Choo noted that more sustainable and efficient materials and processes are major drivers in the automotive industry.

“To support customers in reaching their sustainability goals, BASF Coatings has developed ZENOMENON, an outstanding color concept that uses innovative polymer structures with a high proportion of renewable materials instead of classic pigments,” she said. “This sustainable approach not only reduces environmental impact but also provides a unique and striking appearance. For now, this is only a concept color, not ready for line application yet. However, we are constantly seeking new innovative sustainable solutions to meet our customers’ needs.”

Bellezza said that PPG recognizes the need to provide differentiated and sustainable solutions and services that enable customers’ productivity.

“PPG’s automotive coatings business offers its customers a wide selection of coatings, adhesives, sealants and battery solutions renowned for their performance, durability, appearance and sustainable innovation – all of which align well to customer strategies,” said Bellezza. “Our team’s focus continues to be the safety of our people, the quality and reliability of our products and services, and ongoing innovation to exceed the needs of our customers.

“Throughout the closing months of 2024, our PPG ENVIRO-PRIME EPIC 200X electrocoat, our PPG Enviro-Prime EPIC 300 electrocoat and our PPG CORASEAL 4-Wet Sealer were all recognized as innovative and sustainably advantaged products that we’re delivering to customers today,” added Bellezza. “From pre-treatment to clearcoat and everything in between, we truly deliver comprehensive coatings solutions across various systems and substrates, and that’s how we protect and beautify vehicles all over the world.”

Carvalho pointed to sustainability, recycled materials, new substrates and lighting and cost optimization as key trends.

“OEMs are increasingly prioritizing sustainable solutions,” he reported. “AkzoNobel is supporting this shift by developing bio-based interior paints for brands such as KIA Motors and investing in water-based coatings that reduce VOC emissions while maintaining high performance.

“There’s a strong push for the use of recycled plastics in automotive components,” added Carvalho. “AkzoNobel is working closely with key Tier suppliers to develop coatings that adhere effectively to these materials, ensuring compliance with OEM specifications, including adhesion and durability tests. Automotive design trends are evolving, incorporating new substrates such as transparent polycarbonate and translucent polypropylene, particularly in exterior applications. In addition, laser etching – a technique commonly used in interiors – is now being introduced for exterior decorative elements, requiring innovative coating solutions. As pricing pressures rise, customers are seeking high-efficiency coating solutions that optimize material use and improve process efficiency without compromising quality.”

Color and Special Effect Trends

Colors remain a key aspect for consumers, and Choo noted that BASF’s latest Automotive Color Trends 2024-2025 collection ROUTING features new reds with intense purple shades, signifying a shift from darker and blueish reds.

“The dark achromatic colors have been energized by intense color effects, offering dynamism beyond solid black,” said Choo. “Fine metallic effects are particularly characterized by strong effects on the surface, which give metallics new radiance.

“The spectrum of pastel colors continues to diversify, for example in beige and light green tones already available in the market, as well as in unusual intermediate tones,” added Choo. “Sustainability and functionality remain core themes in ROUTING, with colors developed using renewable, recycled, and bio-based materials, and optimized for sensor-based driving systems.”

Choo noted that the regional markets are characterized by similarities and differences.

“One of the biggest differences that we see in Asia, especially China, compared to other regions is the sheer variety of colors available,” Choo added. “We recognize a much faster cycle of change, while more unconventional and eye-catching car colors are hitting the streets. American cars are generally bigger and therefore need colors that match large surfaces. Also, in this region, new players show beautiful, elegant colors.”

Bellezza said that in general, PPG is seeing warmer organic tones, such as violets.

“Our PPG Color of the year 2025 Purple Basil is very much appreciated,” added Bellezza. “For the longer-term trends, we also see that darker tones will be more colored and underlined with new, brighter and cleaner luster finishes.

“We predict consumers are ready for more color, and the desire for personalized experiences through color continues to drive innovation,” said Bellezza. “The desire for different textures, finishes, and effects continues to grow as well. Both interior and exterior styling for the mobility industry is exploring textures, metal-like looks, anodized optic, solid metallics, and warm tones.

“Color harmony is extremely important, and something we at PPG know how to do well, carrying the same color and effect seamlessly from one surface to another regardless of substrate. That is leading to the continued exploration of color spaces and effects for plastics, such as bumpers, and for wheels. The styling capabilities are endless, and we continue to innovate with our customers to push the boundaries of their ideas and our technical expertise,” added Bellezza, who noted that capabilities such as precision application technology from PPG bring additional opportunities for designers to reach multi-color palettes in vehicle styling, a trend we also see today.

“As the automotive industry is moving toward autonomous driving, we also know that our design work is moving from purely color design to functional design to potentially enable level five AV. One area of focus is radar compatibility, which is very much linked to aluminum-based effect pigments,” said Bellezza.

“OEMs are increasingly leveraging color and special effects to differentiate their vehicles,” Carvalho said. “Some key trends include a rise in tri-coat finishes and contrast colors to enhance vehicle aesthetics and attract buyers; a growing preference for matte finishes, particularly for high-end vehicles; emerging electric vehicle (EV) manufacturers introducing vibrant, exotic color palettes to create distinct brand identities; and the shift towards decorative coatings on previously overlooked parts, such as brake calipers and wheels, using bold colors such as copper, blue and variations of yellow and green.”