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Automotive Coatings, Sealants & Adhesives

US demand to reach $5.6 billion in 2014
US demand for coatings, adhesives and sealants used in the automotive industry is forecast to reach $5.6 billion in 2014. This represents a significant rebound from the declines of the 2004-2009 period, when the market was adversely impacted by the global economic downturn. The US motor vehicle industry was particularly hard hit by the weak global economy, as falling consumer confidence and a tightening in credit markets severely restricted new vehicle purchases. As a result, vehicle output was nearly cut in half between 2004 and 2009, reducing demand for coatings, adhesives and sealants at the original equipment manufacturer (OEM) level. Through 2014, however, this segment of the market will drive overall gains as vehicle production expands rapidly from a depressed base.

OEM segment to regain position as leading outlet
The OEM segment has historically dominated the automotive coating, adhesive and sealant market. In 2009, however, vehicle output had fallen so low that the aftermarket accounted for more than half of demand. Going forward, the OEM segment will expand at a doubledigit pace and once again take its place as the leading outlet for coatings, adhesives and sealants. Passenger cars are expected to offer the best opportunities for growth, benefiting from their greater fuel efficiency compared to larger vehicles. Smaller vehicles, however, consume less coatings, adhesives and sealants on a per vehicle basis than do larger vehicles.

Aftermarket demand to also accelerate through 2014
The aftermarket generally provides more stable growth than its OEM counterpart, as it is largely dependent on the size of the nation’s motor vehicle park, a much less volatile indicator than vehicle output. Demand in this market will also accelerate through 2014. As economic conditions improve, drivers will be more likely to make nonessential repairs that they may have chosen to forgo during times of economic uncertainty. Advances will be further supported by accelerating growth in the number of motor vehicles in use. In particular, above-average gains in the larger vehicle segments will bode well for demand, as these vehicles consume higher volumes of coatings, adhesives and sealants in their repair than do smaller vehicles.

Water-based, powder, radiation-curable products to lead gains in coatings
Coatings will remain the leading product type, accounting for more than threequarters of market value in 2014. Waterbased, powder and radiation-curable coatings will provide the best gains, as their good environmental profile enables users to meet stricter VOC requirements. However, overall demand will advance at a below-average pace as efforts to improve paint shop efficiency, reduce costs and limit waste will restrict gains in market volume. Sales will also be impacted by greater competition from alternative materials, such as in-molded colored plastics and paint films.

Adhesive, sealant segments to outpace coatings
More rapid growth will be achieved by the smaller adhesive and sealant segments. Advances will be promoted by cost-cutting measures and efforts to increase fuel efficiency by reducing vehicle weight, both of which favor the use of adhesives and sealants over welded joints, mechanical fasteners and gaskets.

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PRESS RELEASE

US DEMAND FOR COATINGS, ADHESIVES AND SEALANTS USED IN THE AUTOMOTIVE INDUSTRY TO REACH $5.6 BILLION IN 2014

US demand for coatings, adhesives and sealants used in the automotive industry is forecast to expand 9.4 percent annually to $5.6 billion in 2014. This healthy rate of growth represents a significant rebound from the declines of the 2004-2009 period, when the market was adversely impacted by the global economic downturn. The US motor vehicle industry was particularly hard hit by the weak global economy. As a result, vehicle output was cut in half between 2004 and 2009, reducing demand for coatings, adhesives and sealants at the original equipment manufacturer (OEM) level. Through 2014, however, this segment of the market will drive overall gains as vehicle production expands rapidly from a depressed base. These and other trends are presented in Automotive Coatings, Adhesives & Sealants, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

The OEM segment has and sealant market. In 2009, however, vehicle output had fallen so low that the aftermarket accounted for nearly three-fifths of demand. Going forward, the OEM segment will expand at a double-digit annual pace and once again take its place as the leading outlet for coatings, adhesives and sealants. The aftermarket generally provides more stable growth than its OEM counterpart, as it is largely dependent on the size of the nation’s motor vehicle park, a much less volatile indicator than vehicle output. Demand in this market will also accelerate through 2014.

Coatings will remain the leading product type, accounting for more than threequarters of market value in 2014. Water-based, powder and radiation-curable coatings will provide the best gains, as their good environmental profile enables users to meet stricter volatile organic compound (VOC) requirements. However, overall demand will advance at a below-average pace as efforts to improve paint shop efficiency, reduce costs and limit waste will restrict gains in market volume. Sales will also be impacted by greater competition from alternative materials, such as in-molded colored plastics and paint films.

More rapid growth will be achieved by the smaller adhesive and sealant segments. Advances will be promoted by cost-cutting measures and efforts to increase fuel efficiency by reducing vehicle weight, both of which favor the use of adhesives and sealants over welded joints, mechanical fasteners and gaskets. Adhesives will benefit from the rising use of plastics in motor vehicle manufacture, since plastics are compatible with adhesives and cannot be welded.

INTRODUCTION
I. EXECUTIVE SUMMARY
II. MARKET ENVIRONMENT
General
Macroeconomic Overview
Demographic Outlook
Personal Consumption Spending
Motor Vehicle Industry Overview
Motor Vehicle Outlook
Motor Vehicle Suppliers
Motor Vehicle Industry Research & Development Trends
Collision/Accident Trends
Competitive Technologies
Joining Technologies
Coating Technologies
Gasket Technologies
Environmental & Regulatory Considerations
The Environmental Protection Agency
The Occupational Safety & Health Administration
III. OVERVIEW
General
Demand by Product
Historical Market Trends
Pricing Trends
International Activity
World Automotive Coatings, Adhesives & Sealants
Demand by Market
Global Suppliers
IV. AUTOMOTIVE COATINGS
General
Formulations & Substrates
Solvent-Based
Water-Based
Other
Powder Coatings
Electrodeposition Coatings
Radiation-Cured Coatings
Types
Urethane
Acrylic
Epoxy
Other
Markets & Applications
OEM
Exterior
Other OEM
Light Vehicles
Medium- & Heavy-Duty Vehicles
Aftermarket
Light Vehicles
Medium- & Heavy-Duty Vehicles
Suppliers
OEM
Aftermarket
V. AUTOMOTIVE ADHESIVES
General
Formulations
Solvent-Based
Water-Based
Other
Hot Melts
Radiation-Cured
Functions
Types
Urethane
Epoxy
Acrylic
Other
Markets & Applications
OEM
Light Vehicles
Medium- & Heavy-Duty Vehicles
Aftermarket
Light Vehicles
Medium- & Heavy-Duty Vehicles
Suppliers
OEM
Aftermarket
VI. AUTOMOTIVE SEALANTS
General
Formulations
Water-Based
Solvent-Based
Other
Types
Synthetic Elastomers
Urethane
Silicone
Other
Markets & Applications
OEM
Light Vehicles
Medium- & Heavy-Duty Vehicles
Aftermarket
Light Vehicles
Medium- & Heavy-Duty Vehicles
Suppliers
OEM
Aftermarket
VII. APPLICATIONS
General
Exterior
Coating Applications
Adhesive & Sealant Applications
Interior
Under-the-Hood
Other
VIII. MARKETS
General
OEM
Light Vehicles
Automobiles
Light Trucks & Vans
Medium- & Heavy-Duty Vehicles
Aftermarket
Light Vehicles
Medium- & Heavy-Duty Vehicles
IX. INDUSTRY STRUCTURE
General
Market Share
Coatings
Adhesives & Sealants
Competitive Strategies
Acquisitions & Divestitures
Cooperative Agreements
Marketing
Distribution
Manufacturing
Research & Development
Company Profiles
ADCO Global Incorporated
Akzo Nobel NV
Arkema SA
Ashland Incorporated
BASF SE
Bayer AG
Bemis Associates Incorporated
Bostik, see Total
Cook Composites and Polymers, see Total
Cytec Industries Incorporated
Dow Chemical Company
Dow Corning Corporation
DuPont (EI) de Nemours
Dyneon, see 3M
EFTEC, see EMS-Chemie Holding
EMS-Chemie Holding AG
FinishMaster Incorporated
Forbo Holding AG
Fujikura Kasei Company Limited
Henkel AG & Company KGaA
Huntsman Corporation
Illinois Tool Works Incorporated
ITW TACC, see Illinois Tool Works
LORD Corporation
MAACO Enterprises Incorporated
Momentive Performance Materials Holdings LLC
Nippon Paint Company Limited
Nitto Denko Corporation
NOF Corporation
Permatex, see Illinois Tool Works
PPG Industries Incorporated
Radiator Specialty Company
Red Spot Paint & Varnish, see Fujikura Kasei
Reichhold Incorporated
RPM International Incorporated
Rust-Oleum, see RPM International
Sartomer, see Total
Sherwin-Williams Company
TCI, see RPM International
3M Company
Total SA
Transtar Industries Incorporated
US Paint Corporation
Valspar Corporation
Wacker Chemie AG
Other Companies in the Industry
LIST OF TABLES
SECTION I -- EXECUTIVE SUMMARY
Summary Table
SECTION II -- MARKET ENVIRONMENT
1 Macroeconomic Indicators
2 Population & Households
3 Personal Consumption Expenditures
4 Motor Vehicle & Parts Shipments
5 Motor Vehicle Indicators
6 Selected VOC Content Standards for Automotive Refinish Coatings
SECTION III -- OVERVIEW
1 Automotive Coating, Adhesive & Sealant Demand by Product
2 Automotive Coating, Adhesive & Sealant Market, 1999-2009
3 Pricing for Automotive Coatings, Adhesives & Sealants
4 World Motor Vehicle Production
SECTION IV -- AUTOMOTIVE COATINGS
1 Automotive Coating Demand
2 Automotive Coating Demand by Formulation & Substrate
3 Automotive Coating Demand by Type
4 Urethane Automotive Coating Demand
5 Acrylic Automotive Coating Demand
6 Epoxy Automotive Coating Demand
7 Other Automotive Coating Demand
8 Automotive Coating Demand by Market & Application
9 Automotive OEM Coating Demand by Vehicle & Application
10 Light Vehicle OEM Coating Demand by Vehicle
11 Medium- & Heavy-Duty Vehicle OEM Coating Demand
12 Automotive Aftermarket Coating Demand by Vehicle & Application
13 Light Vehicle Aftermarket Coating Demand
14 Medium- & Heavy-Duty Vehicle Aftermarket Coating Demand
SECTION V -- AUTOMOTIVE ADHESIVES
1 Automotive Adhesive Demand
2 Automotive Adhesive Demand by Formulation
3 Automotive Adhesive Demand by Function
4 Automotive Adhesive Demand by Type
5 Urethane Automotive Adhesive Demand
6 Epoxy Automotive Adhesive Demand
7 Acrylic Automotive Adhesive Demand
8 Other Automotive Adhesive Demand
9 Automotive Adhesive Demand by Market & Application
10 Automotive OEM Adhesive Demand by Vehicle & Application
11 Light Vehicle OEM Adhesive Demand by Vehicle
12 Medium- & Heavy-Duty Vehicle OEM Adhesive Demand
13 Automotive Aftermarket Adhesive Demand by Vehicle & Application
14 Light Vehicle Aftermarket Adhesive Demand
15 Medium- & Heavy-Duty Vehicle Aftermarket Adhesive Demand
SECTION VI -- AUTOMOTIVE SEALANTS
1 Automotive Sealant Demand
2 Automotive Sealant Demand by Formulation
3 Automotive Sealant Demand by Type
4 Synthetic Elastomer Automotive Sealant Demand
5 Urethane Automotive Sealant Demand
6 Silicone Automotive Sealant Demand
7 Other Automotive Sealant Demand
8 Automotive Sealant Demand by Market & Application
9 Automotive OEM Sealant Demand by Vehicle & Application
10 Light Vehicle OEM Sealant Demand by Vehicle
11 Medium- & Heavy-Duty Vehicle OEM Sealant Demand
12 Automotive Aftermarket Sealant Demand by Vehicle & Application
13 Light Vehicle Aftermarket Sealant Demand
14 Medium- & Heavy-Duty Vehicle Aftermarket Sealant Demand
SECTION VII -- APPLICATIONS
1 Automotive Coating, Adhesive & Sealant Demand by Application
2 Exterior Applications for Automotive Coatings, Adhesives & Sealants
3 Interior Applications for Automotive Coatings, Adhesives & Sealants
4 Under-the-Hood Applications for Automotive Coatings, Adhesives & Sealants
5 Other Applications for Automotive Coatings, Adhesives & Sealants
SECTION VIII -- MARKETS
1 Automotive Coating, Adhesive & Sealant Demand by Market & Vehicle
2 OEM Demand for Automotive Coatings, Adhesives & Sealants by Product, Vehicle & Application
3 OEM Light Vehicle Demand for Automotive Coatings, Adhesives & Sealants by Product & Vehicle
4 OEM Automobile Demand for Automotive Coatings, Adhesives & Sealants
5 OEM Light Truck & Van Demand for Automotive Coatings, Adhesives & Sealants
6 OEM Medium- & Heavy-Duty Vehicle Demand for Automotive Coatings, Adhesives & Sealants
7 Aftermarket Demand for Automotive Coatings, Adhesives & Sealants by Product, Vehicle, Application & Outlet
8 Light Vehicle Aftermarket Demand for Automotive Coatings, Adhesives & Sealants by Product & Vehicle
9 Medium- & Heavy-Duty Vehicle Aftermarket Demand for Automotive Coatings, Adhesives & Sealants
SECTION IX -- INDUSTRY STRUCTURE
1 US Automotive Coating, Adhesive & Sealant Sales by Company, 2009
2 Selected Cooperative Agreements
LIST OF CHARTS
SECTION III -- OVERVIEW
1 Automotive Coating, Adhesive & Sealant Demand, 1999-2009
SECTION IV -- AUTOMOTIVE COATINGS
1 Automotive Coating Demand by Type, 2009
SECTION V -- AUTOMOTIVE ADHESIVES
1 Automotive Adhesive Demand by Type, 2009
SECTION VI -- AUTOMOTIVE SEALANTS
1 Automotive Sealant Demand by Type, 2009
SECTION VII -- APPLICATIONS
1 Automotive Coating, Adhesive & Sealant Demand by Application, 2009
SECTION IX -- INDUSTRY STRUCTURE
1 US Automotive Coating, Adhesive & Sealant Market Share by Company, 2009
2 US Automotive Coating Market Share, 2009
3 US Automotive Adhesive & Sealant Market Share, 2009

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