Architectural Coatings Market

Architectural Coatings Market

The global Architectural Coatings Market was USD 85.0 billion in 2023 and is projected to reach USD 102.7 billion by 2028, growing at a cagr 3.9% from 2023 to 2028. Leading multinational corporations are relocating their manufacturing bases, opening sales offices, and expanding distribution networks to countries with high demand, such as Asia Pacific. The gradual relocation of manufacturing facilities to nations with high demand and cheaper production costs has a favorable impact on market growth. The top manufacturers control a sizable portion of the worldwide market. As a result, architectural coating companies are under intense competitive pressure to cut architectural coating prices in order to acquire market share at the expense of other rivals. Furthermore, regulatory standards for solvent usage and VOC emissions are critical parameters for architectural coating suppliers to consider.

Attractive Opportunities in Architectural Coatings Market

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Architectural Coatings Market Dynamics

Driver: One of the most significant developments observed in the coatings industry over the last ten years has been the growing need for environmentally friendly features, which was mainly driven by stringent EU regulations regarding the reduction of volatile organic compound (VOC) emissions in the coating life cycle. This has changed the market for ecologically benign goods such as aqueous and powder-based paints and coatings away from solvent-borne coatings. The European Commission and other federal government organisations establish new laws and regulations, such as the Eco-product Certification Scheme (ECS). These standards promote a green and sustainable environment by limiting or eliminating dangerous VOC emissions. In addition, after the Quality Council of India (QCI), Pollution Control Board Authorities, and the National Referral Centre for Lead Projects in India (NRCLPI) strongly advised the Government of India (GOI) to fix lead content below 90 ppm for all architectural and household paints, the regulations on lead control in household and architectural coatings were implemented in 2016. These laws encourage architectural coatings firms to invest in bio-based raw ingredients in paints and coatings, making architectural coatings more environmentally friendly. Furthermore, government laws in the United States and Western Europe, particularly those pertaining to air pollution, will continue to encourage the use of innovative, low-polluting coating technologies.

Restraints: The paints and coatings sector is heavily influenced by regulatory rules. Potential regulatory changes might cause uncertainty across the value chain. The time it takes for manufacturers at each node to accept the new rule and embrace new technology is referred to as uncertainty. Various time-consuming regulatory changes in various regions can have an impact on raw material producers, formulators, channel partners, and end users. As more governments enact severe regulatory standards, architectural coatings manufacturers must continually improve their processes in order to comply with the new policies and decrease VOC emissions. In the United Kingdom and the United States, for example, the Varnishes and Vehicle Refinishing Products Regulations 2005 demand a decrease in VOC emissions. In the United States, the Environmental Protection Agency (EPA) has also adopted measures in compliance with the 1977 Clean Air Act revisions. Products that do not fulfil regulatory standards are not sold in the Western European market.

Opportunity: Major architectural coating manufacturers in North America and Europe have to follow stringent government rules and policies. However, the emerging regions have fewer or no rules for this segment. The market for architectural coatings in Asia Pacific and other emerging economies are growing rapidly. Over the last 15 years, emerging economies have accounted for nearly two-thirds of global GDP growth and more than half of new consumption. However, economic success differs significantly among countries. Over the last 30 years, more than two-thirds of GDP growth in outperforming nations has been attributed to a significant improvement in productivity associated with industrialization: an annual average productivity gain of 4.1 percent vs 0.8 percent for the other emerging economies. This rapid development starts the pro-growth cycle by creating wealth and increasing demand, which leads to more jobs.

Challenges: Titanium dioxide (TiO2) is an essential ingredient in the manufacturing of architectural coatings. TiO2 comprises 20–30% of the total expenditure on raw materials. There are many global suppliers of TiO2, and there is no substitute available for this ingredient. TiO2 pigments are traded internationally; however, the fluctuations in the price of TiO2 have increased in both amplitude and frequency in the last decade. These frequent changes in the prices make it difficult for customers to plan their spending and affect their profit margin. In the US market, the TiO2 price has shown conflicting market emotions. The prices fell precipitously in October 2022 as a result of weak demand fundamentals. Prices rose somewhat in November before falling again in late Q4. According to industry participants, the construction sector has been mediocre, causing no meaningful change in TiO2 demand dynamics. Furthermore, rising interest rates and inflationary pressures have hindered manufacturing across the country. The market was operating at low levels, and ocean shipments were also down. As a consequence, at the conclusion of the fourth quarter, TiO2 98% CFR USGC prices were estimated at USD 3118 per ton.

Architectural Coatings Market Ecosystem

Based on user type, professional segment is estimated to account for the largest market share of the architectural coatings market

Another alternative for a paint job is to hire painters or painting contractors. One of the main reasons to hire a professional is to assure a high-quality finish and to prevent damage furniture or flooring. Such paint jobs also finish faster, which might assist end users if time is of the essence. Furthermore, the shift towards professional or Do-it-yourself services is becoming more visible as the number of elderly people and young people who have not learned how to do DIY grows. Professional painting is chosen over a DIY project when a house is placed up for sale in residential construction or when a homeowner wishes to paint/repaint the home for aesthetic grounds.

Based on coating type, interior segment is anticipated to dominate the market

Interior paint coatings provide stain repellency, improved concealing properties, durability, and long-lasting performance with application diversity. Low-VOC, low-odor paints are currently favored above other paints. These paints enable experts to paint in inhabited areas while causing minimal disturbance to the end user's daily operations. There is currently a trend towards utilising expensive paints. While any standard paint can give a home a facelift, premium paint transforms interior surfaces to make them last longer. Consumers examine various factors when selecting interior paints, such as stain resistance, film durability, and low odor. Interior coatings with durability and long-lasting performance are sought after by homeowners and professionals. Consumers choose goods that need less time to apply, such as paint-and-primer-in-one.

By application, the residential segment of the architectural coatings market is projected to witness the highest CAGR during the forecast period.

Economic expansion and better salaries in recent years have resulted in the construction of various new residences and the remodeling of existing ones. New paint and repainting are examples of architectural coatings for residential construction applications. Paints, stains, lacquers, primers, and cleansers are examples of architectural and utilitarian coatings. Architectural coatings are utilised in both interior and exterior home applications. Repainting is the process of imparting a fresh look to an old or worn-out interior or exterior of a structure.

The Asia Pacific market is projected to contribute the largest share of the architectural coatings market.

Asia Pacific is a fast-rising market with numerous possibilities for industry participants. The vast majority of large corporations in North America and Europe aim to transfer their manufacturing operations to this area because of the availability of low-cost raw materials, cheap production costs, and a desire to better serve local consumers. As the region's middle-class population grows, so does its hunger for luxury goods. Government measures are also assisting the growth of the building and construction industry. These characteristics are projected to have a significant impact on the architectural coatings industry.

According to the IMF, the Russia-Ukraine conflict has had a broad impact on the Asian economy in terms of trade and financial market instability, as well as inflation, and the danger of regional fragmentation is significant. One of the most severe repercussions on Asia is a drop in international demand. The second focuses on food and commodity prices, which have skyrocketed since the crisis. The pandemic has already hurt the Asian economy, which has been compounded by the fighting and has produced economic instability. Prior to the epidemic and war, many nations had commercial conflicts, particularly China and the United States. As a result, trade fears have skyrocketed.

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Architectural Coatings Market Players

The Sherwin-Williams Company (US), PPG Industries, Inc (US), AkzoNobel N.V. (The Netherlands), BASF Coating GMBH (Germany), Jotun A/s (Norway), Asian Paints Limited (India), Kansai Paint Co., Ltd (Japan), Nippon Paint Holding Co., Ltd (Japan), RPM International, Inc (US), Masco Corporation (US) are the key players operating in the global market.

Please visit 360Quadrants to see the vendor listing of Top paint and coating companies 

Architectural Coatings Market Report Scope

Based on resin type, the architectural coatings industry has been segmented as follows:

• Acrylic
• Alkyd
• Vinyl
• Polyurethane
• Others

Based on technology, the architectural coatings industry has been segmented as follows:

• Waterborne
• Solventborne
• Powder coatings

Based on application, the architectural coatings industry has been segmented as follows:

• Residential
  • New construction
  • Remodel and repaint
• Non-residential
  • Commercial
  • Industrial
  • Infrastructure

Based on coating type, the architectural coatings market has been segmented as follows:

• Interior
• Exterior

Based on user type, the architectural coatings market has been segmented as follows:

• DIY
• Professional

Based on the region, the architectural coatings market has been segmented as follows:

• North America
• Europe
• Asia Pacific
• Middle East & Africa
• South America

Recent Developments

• After negotiating a deal to buy Colombia-based paints and coatings manufacturer Grupo Orbis, AkzoNobel N.V. plans to grow its operations in South and Central America in June 2021. Grupo Orbis operates in ten countries in South America, Central America, and the Antilles. This is a plan for growth and delivery.
• Tikkurila was bought by PPG in June 2021. This is aimed at helping the firm extend its paint and coating selections, which will now include Tikkurila's environmentally friendly ornamental products as well as high-quality industrial coatings.

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