Decorative paints
market overview

End-user segment strategy context

Decorative paints makes up just under half of the world market for paints and coatings. All revenue generated by the decorative paints industry stems from the Buildings and Infrastructure end-user segment. This segment was hit hard by the recent recession and still hasn’t fully recovered globally.

Buildings and Infrastructure

Decorative paints are primarily used in two sub-segments within Buildings and Infrastructure – Maintenance, renovation and repair and New build projects. We estimate that a substantial part of our revenue (around 75 percent) is derived from the former, rather than the latter. Maintenance, renovation and repair is less cyclical than New build projects, but also has generally lower growth over the full cycle. More context on each of these two sub-segments follows.

New build projects

Badly affected by the recent economic downturn, this segment is beginning to regain momentum in many countries. There has already been a return to growth in the high growth geographies. Given our strength in many of these regions, this is a very positive development from an AkzoNobel perspective. However, we expect that growth going forward will be at lower, or even much lower, levels than we have seen previously, particularly in China. In mature markets relevant for AkzoNobel, some slight recovery is visible in Europe, but the picture remains uncertain.

Maintenance, renovation and repair

Looking ahead, predictions are for double digit growth in Maintenance, renovation and repair in high growth markets, but with reduced growth rates in some other key markets, such as China and Brazil. In mature regions, we already see a limited return to growth, evidenced by increased housing transactions and house prices, notably in the UK, one of our key European markets.

Some of our customers

Decorative Paints – Some of our customers (logos)

Top raw materials

  • Binders/resins
  • Titanium dioxide
  • Packaging materials

Key cost drivers

  • Oil prices
  • Energy prices
  • Steel prices

Market leadership positions

 

 

Decorative Paints Europe

1st

Continental Europe

 

Northern and Eastern Europe

 

UK, Ireland and South Africa

 

 

Decorative Paints Latin America

2nd

Latin America

 

 

Decorative Paints Asia

1st

South East Asia and Pacific

2nd

China and North Asia

3rd

India and South Asia