South Africa Automotive OEM Coatings Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023-2028)

Key Highlights

• The driving factors that tend to the market growth include an increase in the production of Auto OEM vehicles in 2021, and according to OICA, there was a total of 4,99,087 units of vehicles produced, including passenger cars, commercial vehicles, busses, and trucks.
• The stringent regulations regarding the VOC limits and other toxic substances in paints and coatings are creating hindrances in the market.
• There has been an increase in the R&D for developing various bio-based OEM coatings in the market in view of stringent VOC regulations set by the governing bodies.

South Africa Automotive OEM Coatings Market Trends

Growth in the production of Automotive vehicles

• The South African Automotive industry plays a vital role in increasing the country's overall GDP. The industry contributes around 4.9% to the country's GDP, of which 2.8% is from Automotive manufacturing and 2.1% from retail.
• The country's vehicle production is in 22nd position globally, with a 0.58% vehicle production market share.
• Most of the Automotive OEM coatings are consumed by passenger cars and light commercial vehicles in the country.
• Passenger car production amounts to around 47% of the overall automotive production in the country, while the light commercial vehicle is around 46% of the overall automotive production in 2021.
• The country's development plans concentrate on becoming well-integrated into the global automotive environment by increasing Foreign Direct Investments and Trade. South Africa aims to generate 1% of global car manufacturing, or 1.4 million automobiles annually, by 2035.
• In 2013, the export-focused Motor Industry Development Program was replaced by the Automotive Production Development Program (APDP). The goal of the APDP is to increase the production of automotive parts in the country while keeping incentives for original equipment manufacturers (OEMs) to make passenger cars and light commercial vehicles in the country for export and the local market.

Solvent Borne-Coatings To Dominate The Market

• Automotive OEM coatings are used in various types of vehicles such as passenger cars, light commercial vehicles, heavy commercial vehicles, and other vehicles where coatings are necessary.
• There are various technologies used in Automotive coatings. They are categorized as Water-Borne, Solvent Borne, Electrocoats, and Powdered Coatings. Most OEM manufacturers use coatings that are solvent-based owing to their low cost and advantagious properties
• Recently there has been a major shift in the change of technologies used in various auto OEM coatings.
• Due to various environmental regulations, such as the reduction of the VOC in the Auto OEM paints, coatings manufacturers are shifting towards more renewable sources for the production of OEM coatings.
• There is a rise in demand for the use of water-borne OEM coatings in recent times. The major reason for this shift is the mandate set by various governments for the reduction of VOC content in automotive OEM coatings.
• Most of the coatings used such as Epoxy, Polyurethane, Acrylic, and others are based on fossil fuels. As fossil fuels are decreasing the demand for alternatives has raised.
• In 2021 Ford Motor Company of South Africa has invested around USD 1.05 billion in the country to upgrade its manufacturing operations in Pretoria.
• As part of the Investment, PPG's Coatings Services business will manage the electrocoat lines crucial to the improved paint shop operations at the Ford Silverton Assembly Plant for the brand-new Ranger pickup vehicle.
• In this, PPG is planning to use low-VOC paints in Ford cars. With these new low-temperature chemicals, less energy will be used and fewer VOCs will be released.
• However the development of such new technologies takes time and hence the share of such environmental friendly coatings used in Auto OEM paints is still low.

South Africa Automotive OEM Coatings Market Competitor Analysis

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• The market estimate (ME) sheet in Excel format
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