Market Trends of India Automotive Paints And Coatings Industry
Polyurethane Resin Type to Dominate the Market
- Polyurethanes are a vast family of polymers that may be adapted to a variety of purposes, and they play an important role in the construction, automotive, and electrical industries.
- Automobile primer, intermediate coat, and finishing paint are all types of automotive coatings. Cathodic electric deposit is used in 92% of primers, according to the coating procedure (CED). It's made up of 90% cathode electrophoretic paint. The overall performance of polyurethane electrophoretic paint is good.
- Polyurethane coatings provide car exteriors with high gloss, durability, scratch resistance, and corrosion resistance. They are also used for glazing windshields and windows, increasing strength, and providing fog resistance.
- The automotive industry in India is an important indicator of how well the Indian economy is performing, as this sector plays a vital role in both technological advancements and macroeconomic expansion. As per the India Brand Equity Foundation (IBEF), the country's annual production of automobiles in FY 2022 was nearly 22.93 million.
- Furthermore, in the first nine months of 2022, Indian passenger car sales remained strong due to the accumulation of savings, coupled with lower interest rates and an increasing preference for personal mobility, which convinced customers to buy new cars. As a result, new car registrations in India grew by around 20.2% in the first three quarters of 2022 to reach 2.8 million units. Also, government reforms such as "Aatma Nirbhar Bharat" and "Make in India" programs supported the automotive industry in the country.
- Moreover, in India, during FY 2021-22 (April 2021-March 2022), according to the Society of Indian Automobile Manufacturers (SIAM), the country's automotive industry produced a total of 22,933,230 vehicles, compared to 22,655,609 units during April 2020-March 2021. Further, according to the Center for Monitoring the Indian Economy (CMIE), car production increased to 193,629 units in July 2022 from 169,519 units in June 2022. Such factors are likely to increase the demand for the studied market.
- Because of the aforementioned factors, polyurethane paints and coatings are expected to dominate the market over the next few years.
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Automotive Refinish to Witness Rapid Growth During the Forecast Period
- The automotive sector has been one of the biggest markets in India and has been growing at a steady rate in recent years as well.
- The two-wheeler segment, which accounted for over 48% of the market in 2021, dominates the country's electric vehicle market. According to the Ministry of Road Transport and Highways (MoRTH), 3,29,190 electric vehicles were sold in the country, representing an increase of 168% compared with the sales in 2020. In FY 2022-23, electric vehicle sales already crossed the previous year's figures, with sales of around 4.43 lakh units between April and December. It is expected to reach over 6 lakh units by March 31, 2023.
- Furthermore, according to the OICA, around 5,456,857 vehicles were produced in 2022, which increased by 24% in comparison to 4,399,112 units manufactured in 2021. The increasing automotive sector is expected to augment the market during the forecast period. Moreover, the government's reforms, such as "Aatma Nirbhar Bharat" and "Make in India" programs, are likely to boost the automotive industry, which will further support the demand for PFA in high-end automotive applications.
- Moreover, the Indian government has created momentum through its Faster Adoption and Manufacturing of Hybrid and Electric Vehicles schemes. In some segments, the government mandates the adoption of electric vehicles (EVs), intending to reach 30% EV penetration by 2030. The scheme creates demand incentives for EVs and supports the deployment of charging technologies and stations in urban centers. The government has set a target for 70% of all commercial cars, 30% of private cars, 40% of buses, and 80% of two-wheelers and three-wheelers sold in India to be electric by 2030.
- In 2022, India's EV sales crossed a million units, recording about a 206% hike year-on-year over 2021 sales. With a total of about 10,54,938, India's EV record sales year across all the vehicle segments accounted for about 4.7% of overall automotive sales.
- With the automotive sector recovering from the impact of the COVID-19 pandemic, the Indian automotive paints and coatings market is expected to grow in the forecast period.
