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The Europe paints and coatings market is estimated to witness a significant growth, at an estimated CAGR of over 4%, over the forecast period. Rise in the use of protective coatings in the booming offshore wind turbine industry is expected to drive the market during the forecast period. The unavailability of adequate substitutes for banned lead chromate used in industrial coatings and increasing prices of raw materials are expected to hinder the growth of the market studied.

  • Increasing demand for architectural coatings is one of the major factors driving the growth of the market.
  • Use of nanotechnology in paints & coatings is likely to act as an opportunity in the future.
  • Germany dominated the market across Europe due to the increasing demand in the construction and automotive industry.

Key Market Trends

Increasing Demand from Construction Industry

  • Paints & coatings are not only used in the interior of the houses to add colors or decorative purposes, but also to perform a wide range of functions. Their functions vary depending upon the type of environment and room that they are used on.
  • Paints and coatings are applied on the exterior of the house, not only to give them a new look but also to protect it from blistering summers, freezing winters, soaking rain, and the daily bombardment of UV radiation without fading, peeling away, and cracking.
  • Developments in the construction sector are partly due to the robust economic growth and its positive implications on corporate profits, household income, and the state of public finances. The construction activities in countries, such as the Germany, France, United Kingdom etc., are expected to drive the growth of the market.
  • Moreover, low-interest rate level, internal migration flows, immigration, and investment backlog that has accumulated in areas, like infrastructure, since the financial crisis is supporting the upswing.
  • Renewed focus of European construction companies on local markets and their core business is expected to lead to an increased demand for paints & coatings during the forecast period.

Germany to Dominate the Market

  • The economic growth of the country is affected by the factors, such as trade tensions leading to reduced exports, and tariff disputes triggered by the US government. However, the country is expected to rise from such fluctuations in economic performance over the forecast period.
  • Germany leads Europe’s automotive market with 41 assembly and engine production plants that contribute to one third of the total automobile production in Europe. The new car market in the country, overall, exceeded three million vehicles, but there was a small contraction in the new car market, due to the introduction of new WLTP emission control regulations, as numerous manufacturers were unable to register new cars.
  • The sales/registrations of new vehicles are increasing steadily in the country with improvement in the economy reflecting consumer confidence. This is expected to provide stable contribution to the paints & coatings from the automotive sector.
  • Also, Germany has the largest construction industry in Europe. The residential construction segment is expected to have a moderately high growth. According to industry experts, the recent positive migration to the country is stimulating the demand for new residential construction. It is estimated that 3.6 million migrants are expected to arrive in Germany until 2020, requiring at least 350,000 new dwellings per year, which is expected to boost the construction sector.
  • However, new housing demand will decrease to around 260,000 per year by 2025 and to 246,000 by 2030. Still, in 2018, the German government made an announcement regarding its plan to construct around 1.5 million housing units by 2021.
  • Thus, owing to the growth in the various end-user industries in the country, the consumption of paints and coatings is expected to drive the demand during the forecast period.

Competitive Landscape

The Europe paints and coatings market is partially consolidated, with top players accounting 50% of the market. Akzo Nobel N.V., BASF SE, Jotun, Hempel A/S, and Beckers Group, are some of the major manufacturers of paints & coatings in the European region.

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