Resilience and Adaptability

This issue features our two most popular articles of the year—our annual Global Top 10 and PCI 25 rankings of the top coatings manufacturers. Not only are our eMagazine subscribers anxious to read them, but roughly 42,520 people collectively read these two articles on our website each year. These rankings are the result of months of research into annual reports, news articles, and correspondence with companies. This year's reporting underscores the dynamic and evolving nature of the coatings industry, and the resilience and adaptability that coatings companies have.

While the majority of companies reported overall net sales increases, regional performances varied significantly. Factors driving sales increases include: 1) Increased demand across the automotive, industrial, and decorative sectors globally; 2) Strategic pricing initiatives to offset higher raw material costs and enhance profitability; 3) Penetration into new markets and regions; 4) Introduction of new coatings and specialty products catering to specific customer needs; and 5) Expansion through acquisitions and partnerships, enhancing market share and capabilities.

Five Industry Trends

From the information that we gathered, we pulled together five major trends that continue to dominate the coatings industry.

• Mergers and Acquisitions: Companies continue to leverage acquisitions to expand their market share and enhance their product portfolios. Many companies in the Global Top 10 are focusing particularly in high-growth regions such as Asia-Pacific. AkzoNobel and Nippon Paint have increased their investments in these regions to capitalize on the growing demand for coatings. Other notable acquisitions include PPG's purchase of Ennis-Flint, and Sherwin-Williams' acquisition of Sika AG’s European industrial coatings business. 
• Sustainability: Sustainability initiatives are becoming more pronounced. Companies are not only developing eco-friendly products but are also implementing sustainable practices across their operations. Initiatives include using renewable materials, reducing VOCs, and promoting recycling and circular economy principles.
• Digitalization/AI: Advancements in technology are being integrated into product development and manufacturing processes. Digital tools for color matching, AI for predictive maintenance, and automation in production are becoming more prevalent.
• Customer-Centric Approaches: Companies are increasingly offering tailored solutions and enhanced services to meet diverse customer needs.
• Innovation: Investment in innovation, technology advancement, and R&D are tied to market performance. Companies that continue to stay on top in the rankings are putting forth money and effort into innovative coating applications and formulations that merge performance and sustainability. For example, in 2023:
  • PPG opened a new research and development center in Milan, Italy.
  • AkzoNobel inaugurated an innovation campus in Felling, UK.
  • Sherwin-Williams expanded its Global Innovation Center in Warrensville Heights, Ohio.
  • BASF launched a new coatings technology center in Münster, Germany.
  • Nippon Paint opened a new innovation center in Singapore.
  • Axalta inaugurated a new global innovation center in Philadelphia.
  • RPM’s subsidiary, Carboline, opened a new innovation hub in St. Louis.
  • Jotun established a new R&D center in Sandefjord, Norway. 

Key Takeaways from The Global Top 10

Sherwin-Williams and PPG remain in close competition for the top spot globally, with Sherwin-Williams narrowly retaining its lead in this year’s ranking. Both companies reported significant sales, driven by strategic acquisitions and expansion into emerging markets. Below are some things to note:

• The Sherwin-Williams’ Paint Stores Group and the Performance Coatings Group saw net sales increases, while sales in its Consumers Brand Group (which accounts for 14% of company sales) decreased 0.7%.
• PPG’s organic sales were up by 3%, driven by higher selling prices. The increase was led by growth in aerospace coatings and automotive OEM coatings despite lower global industrial production.
• AkzoNobel retained its third-place position, despite a decrease in reported revenue of 2% in 2023. The company reports that volumes were flat for the year, and acquisitions added 2%.
• Nippon reported an increase in automotive and decorative sales, however industrial coatings sales were down.
• Kansai’s 2023 coatings sales were up 10.5% compared to the prior year, however due to the exchange rate on the last day of the company’s fiscal year, their sales of U.S. $3.71 billion in 2023 are lower than they were in 2022 (U.S. $3.84 billion).

Key Takeaways from The PCI 25 

A few highlights from this year’s PCI 25 ranking of the top North American coatings manufacturers include:

• This year saw the removal of Shawcor Ltd. from our top 25 ranking. The company is now part of Tenaris, which is headquartered outside of North America. Last year, Shawcor ranked in our number 8 spot, with $592 million is sales, however parent company Tenaris does not have coatings sales that place them in our Global Top 10
• Two new companies, NIC and Heirloom, have joined the PCI 25 this year, resulting in NAPCO dropping out of the ranking. NIC and Heirloom have demonstrated significant growth and innovation, earning their spots among the leading manufacturers at positions 17 and 23, respectively
• This will be the last year Kelly-Moore is included in the PCI 25. Despite their solid 2022 sales figures (estimated at approximately $282 million), Kelly-Moore shut down all of its businesses in early 2024. Their inclusion this year honors their final performance in the industry.

We hope you enjoy perusing through the Global Top 10 and PCI 25 rankings in this issue, as well as the handful of articles and interviews from these “Voices from the Top” that are published this month as well.