PPG Completes the Acquisition of Automotive Coatings Manufacturer, Hemmelrath

Posted by MarketsandMarkets on Jul 8, 2019 4:26:18 PM
MarketsandMarkets

In April 2019, PPG completed the acquisition of Hemmelrath, an automotive coatings manufacturer.

MarketsandMarkets™ View Point:

PPG is the global leader in the paints & coatings industry. Its acquisition of Hemmelrath (Klingenberg, Germany), which is a manufacturer of coatings for automotive original equipment manufacturers (OEMs) and a supplier of automotive coatings worldwide, will help PPG expand its automotive coatings business. Hemmelrath operates manufacturing facilities in Klingenberg and Erlenbach, Germany; Jilin, China; Duncan, South Carolina, US; and Indaiatuba (Brazil). More than 7 million vehicles are coated with its products each year.

Hemmelrath has automotive plants in South Africa. By the end of 2013, Hemmelrath opened a new production site in China. “With a global presence, the company provides customized products of outstanding quality and competent service with continuous innovations.” – said Annirban Bhattacharya (Associate Manager, Chemicals & Materials Research at MarketsandMarkets™).

Impact of Acquisition:

PPG is the world’s largest paints & coatings company that serves industries such as architectural, general industrial, protective & marine, automotive OEM, refinish/collision, packaging, and aerospace. The company focuses on innovations to sustain and expand its customer base. In the past few years, PPG has launched new products, which bears testimony to their increased focus on the automotive coatings market. Besides its stronghold in the US, Canada, and the EMEA markets, the company has a presence in the APAC and Latin American countries. “Acquisitions would add to PPG’s geographical advantage. Since PPG has targeted the customers in every region, the large customer base of Hemmelrath, coupled with the in-depth knowledge that the company holds for the local market, would help the former to understand the requirements of the respective regional populace and offer accordingly.” – said Mr. Vikash Kumar, (Manager, Chemicals & Materials Research at MarketsandMarkets™)

The figure below showcases the current market growth potential in the automotive OEM coatings market. The growing demand for electric vehicles, autonomous cars, and semi-autonomous cars is expected to drive the demand for automotive OEM coatings.

FIGURE 1 AUTOMOTIVE OEM COATINGS MARKET, 2019 VS. 2024 (USD BILLION)

AUTOMOTIVE OEM COATINGS MARKE

e - Estimated, p - Projected
Source: Related Research Publications, Government Publications, Company Press Releases, Company Annual Reports, Company Websites, Company Publications, and MarketsandMarkets™ Analysis

Impact on Top Competitors:

Some of the other competitors in the automotive OEM coatings market include BASF SE (Germany), Axalta Coating Systems (US), and Nippon Paint Holdings Co., Ltd. (Japan). With PPG’s outspoken commitment toward the coatings industry, this acquisition would help the company gain a larger market share in the automotive OEM coatings market as compared to the other market players. In 2018, PPG announced 6 acquisitions with annual revenue of about $500 million in the coatings industry. These acquisitions expanded PPG’s technological capabilities and global footprint.

Conclusion:

The acquisition of Hemmelrath would contribute to the growth of PPG as the leading player in the automotive OEM coatings market with an enhanced global presence. In tandem with the growing demand for new types of automotive OEM coatings for semi-autonomous and autonomous vehicles, PPG would be able to make effective use of Hemmelrath’s expertise and cost-effective solutions in launching products that cater to consumer requirements. The company’s focused efforts in expanding its coatings portfolio with similar acquisitions in all the regions are expected to strengthen the company’s offerings in this market.

For more information, please write to us at info@marketsandmarkets.com

Topics: Automotive and Transportation

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