The performance coating market size was valued at USD 83.6 billion in 2022. It is estimated to reach USD 127.7 billion by 2031, growing at a CAGR of 4.82% during the forecast period (2023–2031).
Performance coatings are applied to items to protect them from the elements by reducing heat damage, corrosion, and material wear. In some applications, they also improve the aesthetics of the surface or component. A longer product life could be ensured by reducing certain factors of product deterioration. Performance coatings strike a mix between form and function, with a wide range of color and matching options and a long list of beneficial uses. In addition, performance coatings are available in different designs, such as acrylic, epoxy, polyurethane, polyester, and others, each with distinct applications and properties. Performance coatings come in various forms, which may be water-based, powder based, or solvent-based.
• Acrylic dominates the resin segment
• Solvent-based dominates the form segment
• Buildings and infrastructure dominate the end-user segment
• Asia-Pacific is the highest shareholder in the global market
The unique properties of performance coating assist in preventing corrosion, offers chemical and abrasion resistance, maintains safety and durability, and improve aesthetics on various substrates. Moisture, dust, sun exposure, and grime can all cause considerable damage to your home over time. These properties of protective coatings make them favorable for use in a range of industries.
Additionally, the core functions that all protective coatings must meet are good adhesion to the substrate, abrasion resistance, and durability in diverse settings for applications in various atmospheric conditions such as hot, freeze-thaw, cold, and others. Protective coatings are available in water-based, solvent-based, and powder-based forms depending on the type of surface, application, and requirement. Their availability in different forms based on the application requirement has made them immensely popular in the end-user industries. Therefore, the versatile
The strong demand forms end-user industries such as construction, consumer goods, automotive, and other sectors have firmly pushed the market's growth. The huge investments will bolster the construction industry and boost the demand for protective coatings in the construction industry. For instance, according to Global Infrastructure Outlook, in 2021, the G20 countries announced USD 3.2 trillion of infrastructure stimulus to support the rapidly growing population and industries. In addition, steel, concrete, cement, brick, and drywall substrates benefit from protective coatings, which create a protective layer against harmful conditions, prevent rusting and chipping, and can withstand harsh cleaners and chemicals and are used in the construction sector.
Furthermore, the growing production of automobiles has increased the demand for protective coatings. For instance, according to the International Organization of Motor Vehicle Manufacturers, 77,621,582 vehicles were manufactured in 2020, which grew to 80,145,988 in 2021. Protective coatings are used for coating brake clips, door strikers, gas filler tubes, exhaust gaskets, steering column components, airbags, coil springs, and other components of vehicles. Thus, the strong demand from these two industries is boosting the demand for performance coatings.
The raw material prices of the protective coatings have seen a sudden spike since 2020 owing to the covid-19 pandemic, geopolitical tensions, wars and conflicts, industry competition, intensification of environment protection policies and regulations, tightening of compliance, and other factors. The constantly increasing raw material prices over the past few years have thus increased the production cost of performance coatings of the companies. In addition, the rising and volatile raw material prices have shrunk the profits of the market players.
Additionally, the increasing cost of production due to the growing raw material prices has led to an increase in the prices of performance coatings, which led to market players adjusting their prices and prompting the end-user industries to search for alternatives to performance coatings. Likewise, the supply of raw materials has been turbulent due to the above factors. Therefore, the soaring prices of raw materials may affect the demand for performance coatings as their overall prices increase, thus hampering the market's growth.
The requirements of end-user industries are changing continuously, which has compelled the market players to develop new performance coatings, further aided by the emergence of new coating materials and processes. These new innovative coatings materials result from the constant R&D of the market players. The market players are exploring new coating materials that offer more robust performance, are environmentally sustainable, and fulfill all the requirements of the end-user industries.
Furthermore, new coating processes have emerged that are more optimal and quicker alongside new coating materials. In June 2022, in the Science Direct Journal of Elsevier publication, a research study highlighted the use of Tannin-based inhibitive pigment in sustainable epoxy coatings formulation. Further, the growing demand for chemical and water-resistant materials in consumer goods will boost product demand over the forecast period. This will likely create more opportunities for the players in the performance coating market.
The global performance coating market is segmented by resin, form, and end-user.
Based on resin, the global performance coating market is divided into acrylic, epoxy, polyurethane, polyester, and others.
The acrylic segment is the highest contributor to the market and is anticipated to grow at a CAGR of 4.74% throughout the forecast period. The acrylic resin performance coating has various applications, such as structural steel, piping, machinery, and equipment in hospitals, schools, hotels, industrial sites, and commercial buildings. Acrylic coatings are widely used in building and construction because of their inertness and excellent color retention when exposed to outdoor conditions. Additionally, the demand for acrylic performance coatings is increasing due to increasing infrastructure projects and mounting demand for heavy machinery. Hence, the growing demand from the building and construction sector and demand for infrastructure projects and heavy machinery have enabled acrylic resin performance coating to dominate, with more than one-third of the total market share.
Epoxy coatings are formed by mixing epoxide resin and polyamine hardener (catalyst) through a chemical process known as curing, and such coatings are generally known for their durability. Furthermore, epoxy coatings are widely used in the building and construction sectors, rapidly growing in both developed and developing economies. In addition, epoxy coatings are used in industries as a protective coating for washers, driers, steel pipes, fittings, structural inserts, and industrial equipment; there is also an essential factor driving the growth of this segment.
Based on form, the global performance coating market is segmented into water-based, powder-based, and solvent-based.
The solvent-based segment owns the highest market share and is estimated to grow at a CAGR of 4.63% during the forecast period. In humid settings, solvent-based coatings are advantageous. Solvent-based coatings require substantially less time to dry than water-based coatings, which perform worse in humid environments. By chemically reacting with oxygen in the atmosphere, solvent-based coatings act as liquefying agents and hasten the drying process. In addition, because of their nature, solvent-based coatings are easy to apply in humid environments and at various temperatures. Due to their quick drying characteristics, many sectors also use solvent-based coatings to prevent chemical reactions.
Powder-based coatings have various applications in automotive, appliances, furniture, architectural, general industrial, and other industries. Moreover, powder-based coatings found use in furniture and appliances industries and IT and telecom, both of which are rapidly growing, and hence applications of powder coatings are extensively explored. In addition, in the last decade, investments by steel companies have pushed the development of the appliances, construction, automotive, and electronics sectors in the developing countries of the Asia Pacific and the Middle East. Due to the growth of these industries in emerging nations, the demand for powder coatings is growing.
Based on the end-user, the global performance coating market is segmented into buildings and infrastructure, consumer goods, industrial, and transportation.
The buildings and infrastructure segment is the highest contributor to the market and is projected to grow at a CAGR of 4.72% over the forecast period. The construction sector held a significant share of the performance coating market over the forecast period. Performance coating is employed in various construction raw materials like steel, concrete, cement, brick, and drywall substrates. Growing population, rapid urbanization, and advancements have increased the size of businesses and residential construction. Further, as per Infrastructure Australia 2021, the leading infrastructure activity referring to commercial buildings, civil infrastructure, and residential will double within the next three years. Further, the growing commercial and residential construction activities will thereby positively impact the expansion rate of the performance coating industry.
Performance coatings are used for various industrial purposes in the oil and gas industry, industry, and textile industry, or other large-scale industrial structures subject to harsh environmental conditions. The environment-friendly nature of business coatings has been one of their most significant characteristics. In addition, the key end-use industries of commercial coatings are General Industrial, Protective, Automotive OEM, and Packaging. The expansion of the commercial coatings segment is propelled by advanced development in performance coatings. This industrial coating is non-hazardous, non-flammable, non-toxic, and safe for people and the environment. Powder coat paints not only offer protection but also add beauty to industrial equipment.
Asia-Pacific Dominates the Global Market
Based on region, the global performance coating market is bifurcated into North America, Europe, Asia-Pacific, and RoW.
Asia-Pacific is the highest contributor to the global performance coating market and is anticipated to grow at a CAGR of 5.63% during the forecast period. The accelerating growth of the construction industry and increasing demand for protective coatings in Malaysia propel the development of the performance coating market in Asia-Pacific. Due to its eco-friendliness and generally lower levels of volatile organic compounds (VOCs), which harm the environment, the waterborne coating is the coatings market's fastest-growing technology in Asia-Pacific. Additionally, waterborne paints are preferred in the region due to their low odor, increased durability, and block resistance. Architectural coatings applications mainly drive the market in the Asia-Pacific region, developing economies, considerable investments in infrastructure developments, housing projects, and renovation of existing residential and commercial buildings.
In addition, China is the dominant country in the Asia-Pacific region performance coating market due to the rising consumption from the automotive industry, construction activities, and industrial goods, which all demand performance coatings. Moreover, the automobile sector of China is also expected to grow over the forecast period owing to the rising adoption of electric vehicles by the people.
Europe is estimated to grow at a CAGR of 4.51% over the forecast period. In the European region, there is a rise in proactive coatings in the booming offshore wind turbine industry. The demand for improving the efficiency of the existing housing stock is rising, which is expected to drive the growth of the performance coatings market in Europe. Furthermore, there is increasing demand for performance coatings in Architectural Industry to perform various functions. In the European region, huge developments are happening in the construction sector due to the robust economic growth and its positive implications on corporate profits, household income, and public finances. Construction activities are increasing in countries like Germany, France, the United Kingdom, and others, which is anticipated to propel market growth. Moreover, European construction companies mainly focus on local markets and their core business, which is expected to increase demand for coatings over the forecast period.
In North America, the construction and automotive industries are the significant drivers of demand for performance coatings. The strong automotive industry in the USA is boosting the demand for performance coatings. According to the Bureau of Transportation Statistics, the number of passenger cars and commercial vehicles produced in the USA was 8,821,000 in 2020. The growth in the production of vehicles has directly increased the demand for performance coatings in the USA. For instance, according to the Association of General Contractors of America, construction is one of the major industries contributing to the US economy. The construction industry creates over USD 1.4 trillion in structure every year. This statistic explains the massive requirement for performance coatings in these structures. Further, the performance coatings business invests significantly in research and development (R&D), resulting in several product breakthroughs and new technologies. The contribution to Canada's Gross Domestic Product and the numerous employments created demonstrate the importance of a robust coatings industry in maintaining and boosting the country's overall economic performance.
The RoW comprises the Middle East and Africa and South America. The Middle East and Africa region includes construction, automotive and transportation, and the wood sectors, which all need paints and coatings. In addition, increased focus on tourism and construction is the primary driver of the market in the Middle East region. Housing and infrastructure developments in Saudi Arabia and ongoing construction in Qatar, Dubai, and Abu Dhabi are driving demand for performance coating in the region. Furthermore, Egypt has the most developed building sector in Africa, which is predicted to expand significantly due to increased foreign investments in several building projects. Moreover, the growing construction industry with the rising demand for bio-based and eco-friendly coatings and increasing applications and usage in the aerospace sector are prime factors propelling the growth of the performance coating market in Latin America.
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