Meeting Global Trends For Automotive Coatings
The world is getting smaller. People are more open to new technologies and new ways of doing business in order to be successful in the ever-increasing world of global competition.
The industries that we serve for coatings for plastics are no different. Our customers design products in one or multiple parts of the world, make them in their home country as well as other areas, and sell then anywhere they can. Examples include automobiles; personal communication devices such as cell phones; TVs; cosmetic closures and containers; business machines/computers; toys; and sporting goods.
This article deals with both macro trends in the way that business is done today and specific trends in functional and decorative coatings for plastics.
To demonstrate the truly global aspects of this article, the title was selected in Köln, Germany; the rough outline was done on a flight from London to Cincinnati; it was refined on a flight from Detroit to Tokyo and moved along on the return flight. In the spirit of QS-9000 and continuous improvement it will probably never be finished.
Today’s economics and system trends are driving unified products, universal quality, one performance criteria, and local production for both supply and technical service.
Customers want similar parts to have the same finish. There is a “mix and match” philosophy so that parts could come from different parts of the world for final production anywhere. Shortened lifecycles in the cell-phone and computer industries as short as four months require this. No longer can the automotive industry produce and sell old models in underdeveloped countries. Because of TV and the Internet, consumers all over the world want the “latest” design with the latest features.
Quality is a given in the world today. Customers expect universal high quality for performance and appearance. No longer are cheap or substandard products sold in underdeveloped countries.
Global engineering mandates one performance criteria. It is inefficient to have multiple criteria and duplicated development of products and applications. Due to the pressures to be first to market with new products, with improved performance capabilities at lower cost, companies are allying through licensing, joint development, and sales agreements to satisfy global customers. First to market sells. Who wants the old design with old features?
Our customers, who have production facilities in multiple countries, require local supply and local technical support. For example, a Japanese automotive lighting manufacturer has plants in Japan, China (2), Korea, Thailand, India, the United Kingdom and North America (8 total). They asked: How are you going to serve us with the same product and the same service in all of these locations? My reply was that we currently service six of the countries, and have a plan in place for the other two. You tell us where you need us to be and we will respond.
To serve our global customers, we must consider how good we are at making friends. On my way to Europe in January I read The Lexus and the Olive Tree by Thomas Friedman, a book about our globalized economy. Following is an excerpt from the book that I have used in meetings on both sides of the ocean to set the stage for what we want to accomplish.
“We have moved from a world where everyone wants to go it alone — to a world where you can’t survive unless you have lots of allies, where the Churchillian alliance maker is the executive role model and the horizontally allied company is the corporate model.
“In a global economy, you cannot survive in our industry unless you can compete on a global basis and you cannot do this without alliances.
“The scale of technology has grown to the point where even industry leaders may not have the resources to mount a competitive R&D effort alone, given the enormous costs involved, the uncertainty of outcomes, and shortened product lifecycles. Also, the sheer amount of scientific and technical knowledge required to develop certain complex products in today’s world increasingly requires several firms to pool their resources.
“Finally, the only way these firms can ever recover their huge investments in R&D is by selling not just to their national markets, which are too small, but to the whole wide world, and this also requires allies.
“Alliances are not mergers. They involve two companies keeping distinct identities, but agreeing to work together in a very intimate way. This increased pressure for alliances is one of the features of this era of globalization that is not only new in degree but also new in kind.”1
In summary, this is about survival, shortened product lifecycles and recovery of R&D expenses through expanded sales. This is not a one-size-fits-all mentality, but one-size-fits-one approach. Alliances are not mergers, but they do allow companies of all sizes to select the best partner in each part of the world.
Larry Bosidy, CEO of AlliedSignal, commented that “you could ally with one company in one part of the world and compete with them in another.” Even domestically we have allied with companies who have a particular product niche and where we have an ability to manufacture, sell, and service the customer. This is especially successful if it supports the sale of one of our complimentary products or allows us to add value to our customer.
Effects Of GlobalizationThe global economy is driving alliances. It is the only way to recover investments in research and development, and to gain additional resources to sell and service globally.
Market pressures are driving for shorter product development and shorter product lifecycles. This requires licensing and customizing to meet local requirements and joint development to gain additional resources. The benefit of these is that it reduces time to market to maximize revenue.
Customer demands for higher quality, lower cost and quicker turnaround requires local manufacturing, sales, and technical support. The benefit is gained market share domestically and globally.
Regulatory demands are more stringent, detailed and global, and require intimate communications and joint development. The benefit: we know the regulations and what may be coming.
The customer wants custom service and products designed to their operation. Alliances allow us to meet these requirements.
Plastics Replacing Other MaterialsPlastics, long viewed as cheap and ugly, are playing a huge role in material substitution because they can be successfully coated. Some reasons for substitution include design/styling, weight savings, recyclability, cost savings, improved function and consolidation/integration of parts.
Why Coat Plastics?Historically, plastics are either painted to enhance functional properties of the plastics or to provide decorative effects to increase the sale of the product. Functionally, plastics are coated to improve weathering, and chemical and abrasion resistance. In the case of headlamps, the aluminum vacuum metallized film would not be bright without a basecoat. Primers are used to enhance adhesion characteristics of the topcoat, to hide splay marks or pops from the substrate, to prevent solvent attack on solvent-sensitive substrates, and to provide an extra layer against exterior exposure degradation of the substrate.
For entrepreneurs, the main reason to paint plastic is to increase profit. Plastics painted for decorative reasons sell. “When industries are competing at equal price and functionality, design is the only differential that matters,” says Mark Dziersk, Industrial Designers Society of America.2
Many examples can be shown. A cell-phone company recently concluded that if they discontinued the Henry Ford philosophy of “you can have any color as long as it is black,” they could sell more phones. High line vehicles with finished fascias sell and earn more profit than base line vehicles. Carmakers are putting a premium on how their products look because they realize that otherwise consumers won’t buy them anymore.3 Vacuum metallized gold cosmetic closures sell more perfume than black caps. McDonald’s Happy Meals have decorated toys in them so they can sell more hamburgers.
Plastics are coated as well for ergonomic reasons such as touch/feel in the case of soft-feel coatings. Low-gloss and/or sueded coatings improve veiling glare in automotive interior applications. Veiling glare is a condition where the color of the instrument panel is projected onto the windshield, causing a visibility hazard. Coatings are even being explored that add to the antimicrobial qualities of the coated article.
To meet the trends for greater performance and different appearances, new products have recently been introduced. These include sterling-silver systems using a primer, basecoat, and topcoat; 1K clearcoats with acid etch and scratch resistance; waterborne sparkle silver and other colors to be used in combination with powder primers and topcoats for alloy wheels; waterborne for interior polypropylene, primerless waterborne for TPO; in-mold coatings for steering wheels, door panels with urethane foam and coatings to use with sprayable elastomers to replace vinyl; improved SRC® for lighting lenses with a wider process window; Pop-Free™ primers, interior waterborne coatings with chemical resistance, 1K waterborne coatings for laser etch applications to replace 2K urethane systems; and softer and more chemical-resistant soft-feel coatings.
Global Performance TrendsGlobalization of engineering and approvals leads to the incorporation of regional concerns into world specifications for interior, exterior and forward-lighting specification. The popularity of SUVs and convertibles in this country has led to interior coatings that are resistant to sunscreen and bug repellent. Windex® changed its formula so all interior paint suppliers had to make a product to resist it. New models are being released with coatings that meet these new requirements.
Japanese car manufacturers have added unique chemical reactions to simulate exposure to things that are commonly spilled or absorbed onto interior automotive painted substrates. A new type of polypropylene was developed in Japan for recycle and cost reasons. This required a new waterborne coating to meet the new performance specification and global environmental regulations. Success was only obtained when a U.S. and a Japanese coatings manufacturer pooled resources and jointly developed the new coating.
Primerless waterborne coatings will be available for TPO skins to replace PVC skins on instrument panels. TPO is being developed for this application due to a European concern about the carcinogenic aspects of plasticizers used in PVC. Other developments are focused on eliminating the plasticizer fog that mysteriously appears on the inside of windshields, eliminating the cracking upon weathering, and recycling. Surprisingly, it is cost neutral to negative. Ford says it will be out of PVC by 2004, followed by GM in 2006 model years.
Another alternative to vinyl (PVC) is the emerging technology of in-mold coatings coupled with a sprayable urethane elastomer for flexible skins. The current application is interior automotive door panels. A future application under development is instrument panel skins. Typically a waterborne in-mold coating is sprayed into the mold. Due to the heat of the mold, 140–180ºF, the waterborne paint dries rapidly from the inside out. Originally expensive aliphatic urethane elastomers were sprayed over the in-mold coating at 20 mils thick. These have been replaced by less costly aromatic sprayable elastomers. Once pulled from the mold the skins may be backfilled with foam imparting further softness. Waterborne in-mold coatings are also replacing post painting of steering wheels to improve material usage and to reduce production cycle time.
An emerging trend for performance or function is to enhance the antimicrobial properties of certain frequently touched areas such as steering wheels, interior door handles, buttons or cell phones. You can let your mind run wild with where these enhanced coatings might be used. Testing is under way to ensure that the system works and that the additive that makes it work does not detract from other properties of the coating. Antimicrobial coatings are currently being used in Japan on several cars in high touch areas.
Fuel economy is mandating the use of plastics for weight reduction. Trucks and SUVs have a weight reduction target of 700 lbs. A plastic vs. steel bumper/fascia saves 50 lbs. These fascias will be painted or decorated in some bright fashion.
On the exterior front, testing is under way for 1K exterior clearcoats that give the same qualities as the widely used two-component clearcoats. The driver is to reduce the equipment complexity although those currently using 2K coats routinely use them without problems.
SMC and RRIM are being adopted for pick-up truck boxes for weight reduction, strength, anti-denting and anti-corrosion. Weight reduction is 20% less. Often SMC is used for low volume (<200,000 units) due to lower tooling costs.
With more and more SMC being used, anti-pop SMC primers — both 2K and UV — commercial or are in the evaluation stage. The gas typically trapped in SMC blows out when the topcoat is baked. This makes a very expensive reject since the defect shows up at the end of the process. Anti-pop and UV primers seal in these gasses dramatically reducing rejects and cost.
Design/styling is dictating the shapes of headlamps so that plastics are required. UV coatings are used to seal the SMC reflector surfaces, and to protect the polycarbonate lens from scratching and weathering.
UV coatings that are widely used for automotive lighting reflectors and lenses, as well as a topcoat for cell phones, are also undergoing changes. In the beginning the lenses had the optics molded in. A lot of dirt, both in the paint and from the process, was hidden by the optics. Clear lenses have caused both the coating manufacturer and the finisher to step up their standards for cleanliness. Increased resistance to the Karcher Test (European car wash cycle) and resistance to high temperature (60ºC) watersoak for 240 hours (to check adhesion) have helped to define the process required to meet such requirements and have led to coating improvements. The Automotive Manufacturers Equipment Compliance Agency was previously not thought to be of great importance. Now it is.
Plastic lenses are substituted for glass to improve the function of the part. A European automotive lighting manufacturer told me that polycarbonate lenses show zero breakage, while glass lenses show a 20% breakage factor. Facets being molded into the forward lighting reflector allow the lamp to meet the all important photometric requirements.
UV-curable coatings are capable of being recycled by the coating manufacturer to reduce cost. For years automotive headlamp reflectors have been flowcoated, which uses most of the material. The disadvantage is that both sides are covered so that the practical material usage is close to 50% on the side to be coated. Today, UV SRC coatings are recycled for lenses under a very strict procedure to ensure product consistency. UV coatings lend themselves to recycling because, properly protected from UV exposure and contamination, they do not dry.
Global Trends In AppearanceMeeting the new or existing performance requirements is a given with new appearance concepts. Some of these appearance trends are: Sterling Silver/Chrome Silver, Bright Dry Chrome, personal communication devices using exotic high style colors, metallic colors for automotive interiors, and lighter colors.
Sterling silver, which is a color that looks like brushed or satin chrome (see photos), is getting a lot of attention for both exterior and interior automotive parts. It was first seen in Europe on cell phones and then wheels. It could replace sparkle silver, which is the industry standard on wheel, wheel covers and center hubs. The unmet need in the market place is to match the center hub to the alloy wheel. In Europe there is talk that it could replace woodgrain patterns for interior automotive trim. We could see some exterior grilles or even fascias with this finish to make a plastic part look like metal or chrome plating. Engine and valve covers could use this finish so that the customer sees what he expects to see under the hood —something that looks like metal as well as realize weight savings. Focus on the alloy wheel market has led to the development of a 3.0 VOC waterborne coating to be sandwiched between a powder primer and clearcoat or used with a powder primer and a 1K or 2K clearcoat.
Perhaps driven by aftermarket wheels, the bright chrome appearance of headlamps, retro styling or Denny’s restaurants, chrome is reemerging. Since not all plastics can be successfully chrome plated either by chemical composition or part size, physical vapor deposition (PVD) or sputtering is returning. In the 1970s, a significant effort focused on using this process for grilles. It is what led us into the UV market. Work is continuing to develop systems for wheel hubs and covers, grilles, fascias, and the like. This process uses a UV or 2K basecoat followed by a vacuum process to sputter from a target made from a corrosion-resistant metal like chrome and nickel chrome. Since this layer is very thin, a 2K topcoat is used to improve abrasion resistance and to provide a weathering layer. A UV topcoat is in the works for these applications. PVD is commercial for grilles and other exterior trim parts in Japan. By using alloy plug in the targets (non-reactive) or backfilling the vacuum chamber with various gasses, different colors (blues or greens), and dark to black chrome, can be created. Headlamp housings and bezels might use such a styling effect.
The personal communications devices market are using exotic colors that feature aluminums, pearls and other interference pigments that change color at different angles. The makers view a cell phone as a fashion item, a trend initiated in Europe and quickly mimicked in Asia. Due to the throughput required and the size of a cell phone, UV topcoats seems to be the preferred choice. The major obstacle for the topcoat is not to strike in and disrupt the metallic effect.
Automotive designers have always wanted lighter interior colors. Saturn’s designers trimmed out the CVI SUV/van using a colorful palette of multi-tones and yellow hues. In the past these light colors, particularly when used on the upper instrument panel, caused problems with veiling glare. Perhaps sueded coatings are returning?4
Managing Global ChangeManaging all of these global changes is a challenge. Once a fellow paint manufacturer commented to me: “You’re not running a paint company, you are managing change.” At the time I thought that he was right. After reading The Lexus and the Olive Tree, I found that I don’t want to manage change; I want to lead or initiate change both in the forms of business cooperation and with new technology. It takes money and multiple resources to meet these changes. Our choices are simple: we can either form alliances and grow or become a regional and shrinking company. The bottom line is that growth equals survival.
Meeting the global opportunities requires more than the simplistic view that one company can do it all globally. Our customers need a full-service alliance (many partners and not one) under a unified network. This requires an agreement of who is primarily responsible for what regions, a willingness to license in and out, an understanding of what you will jointly develop and how you are going to supply technical support, and most importantly how do you know that you can manufacture and sell the product.
Our forms of cooperation are changing. We began with licensing out from the 60s to the mid 80s. This was then complimented in the mid 80s by licensing in so that we could serve transplant customers in our region. The global forward lighting business led to joint ventures so that the technology could emanate from one source but the sales, service, and manufacturing from a local source. Next in the evolution came joint development which has been successful both times that we have tried it over the last four years. Now we are in the alliance phase, which allows us to act in a seamless way to meet our customers’ needs in whatever part of the world that they need us.
Goals Of AlliancesFollowing are the goals of our alliances.
- To enhance commercialization. We can’t be successful just by selling in our national markets.
- To improve communications so that we know what is coming with finishing trends and regulations and to keep track of our customers requirements globally.
- To avoid duplication of effort. Why should we develop a new coating or styling effect when we can “ask around” our alliance network to see if one of them already has such a product?
Following are the benefits that we have derived from our alliances.
- We get access to technical innovation. Good ideas come from all over the world.
- We can satisfy our local and global customers to gain business overall.
- We gain access to global raw materials and ideas that often come through personal relationships with suppliers and customers at a local level.
- We eliminate duplication of product development efforts. With the “ask around” strategy we can license in, improve the product together through joint development, or the boldest strategy of all is to assign the outright responsibility to or accept it from your ally.
- We can marshal additional resources (both ideas and materials) through joint development where each party is equally motivated because there are common needs. We will see more of this as global customers with global requirements increase. We were successful with our 1K basecoat development, which we have successfully commercialized and a waterborne interior coating for polypropylene, which will launch in 2001.
- We gain royalty income through sales based on our technology. Supplying technology to allow production globally endears us to our global customers.
- Because of the closeness of the relationship it allows us to benchmark procedures and methods that might not be otherwise available. Benchmarking must be done with the idea in mind that conditions might be different and this is how my partner deals with this issue and not to prove that our way is better.
- An alliance overcomes the “Not Invented Here” (NIH) factor. It formalizes that we are working together for a common goal. Who cares who invented it. Does it make the cash register ring?
- The overall benefit is that it allows us to get closer to the customer to control our destiny.
- Finally the relationship must be built on trust. If we have to read your agreement frequently, we won’t be successful.
Has It Worked?This all sounds great in theory, but has it worked? Has it allowed us to expand sales and to recover R&D expenses? The answer is yes. Following are our results stated in percent of sales.
Sales from licensing in - 10%
Equivalent sales from licensing out or from joint venture sales - 10%
Direct export sales - 19%
Total - 39%
Try to operate on 39% less revenue!
Alliances are not established overnight. Our first foreign trip was in 1959. That was visionary at the time! Don’t rush to make a deal. It takes time to develop trust. Our primary alliance joins parties that we have known for 28 and 13 years, respectively. Recognize that foreign cultures are different (foreign just like it says.) You will develop lasting friendships in the process.
To be successful you need to support it internally. Communicate continually with your allies and internally continually remind your people of why you are doing this. It takes extra effort to deal with people outside your system. Create an Export/International Department so that foreign inquiries and management can be handled through a central focal point. Be prepared to travel to these far off places yourself. There is nothing like being able to visualize someplace because you have been there. You can’t build lasting relationships without going there. Finally hire a foreign national (ex-patriot) who can speak the language and who knows the culture in your primary targeted region.
Last of all, learn to eat with chopsticks and don’t ask too many questions about what you are eating!