“China takes the lead in global sustainability for refinish coatings”

Jane Niemi: 2024 was an incredible year, with a heavy focus on meeting customers’ needs, particularly in regard to digitalisation and sustainability. In terms of digitalisation, we continue to ensure a unique and seamless digital experience with our Refinity cloud platform, designed for color, learning and business management. We also launched our automatic mixing machine AlfaCR4/6 powered by Refinity. The machine can mix up to 6 formulas in 15 minutes, allowing the painter to focus on other activities and reducing overall waste. In addition, we explore next generation spectros with even more powerful software and algorithms that make it even easier to read colours. We also introduced Radar Fit, our solution to assist painters with identifying formulas that are radar friendly for a safe repair.

J.N.: We strive to ensure that there are global synergies, and we take a close look at the preparedness of each market in terms of digitalisation and productivity, so that our products can be deployed as soon as possible everywhere. However, some markets have their own specific characteristics. In EMEA, we launched a new fast-drying clearcoat, R-M Race Finish-R, because there was a demand for a specific, faster and more productive product. We are using our ChemCycling technology to produce this new clearcoat, which is made from recycled waste tyres, to further reduce our customers’ carbon footprint. We have also created an information and communication platform around ChemCycling which is unique to the market.

J.N.: Advanced vehicle technologies are now the same all over the world, it is imperative for us to closely collaborate with our OEM customers ensuring our innovations and training solutions consistently surpass their expectations and are in line with industry advancement. Another global problem is the shortage of labour, which means that we need to maintain the attractiveness of the sector and constantly improve the skills of people entering the profession. We are also working to ensure the diversity of the people employed in our work shops around the world, including providing opportunities for women and young talent to enter the industry. We are also very committed to our exclusive partnership with WorldSkills International on a global level, and we were pleased to cheer on the young paint workers in Lyon this year. When it comes to market differences, on the other hand, in the Americas, there’s a lot of consolidation happening on both distributor and body shop sides. This has been the case for the last seven years, and it has gathered pace over the last two years. Wesco has grown considerably in the United States, as has NCS, and this gives the impression that the big players are getting bigger all the time. As suppliers, we must adapt to this reality, because this consolidation puts a lot of pressure on the market. Independents like the exclusive distributors in our ColorSource community are also doing well. In Asia-Pacific, and particularly in China, the development of new brands and electric vehicles, which is beginning to be seen in Europe, is having a major influence on the development of the market. These vehicles need to be repainted and repaired in specific ways. In terms of sustainability, we note that China is in the process of overtaking the United States when it comes to concerns about greenhouse gas and VOC emissions.

J.N.: Where we are seeing the strongest growth is in Asia-Pacific, with the rapid increase in the number of vehicles on the road and the growth in the electric vehicle population. This is also translating into very strong growth in product sales. EMEA remains a growth market, even if it is more mature. The Americas also remain a very large market, and one that is growing faster because of the consolidation that is taking place in both distribution and bodywork businesses. In North America, in particular, what is happening is exciting, with the deployment of multi-site organisations. But all markets are promising. China and Asia-Pacific is obviously the strongest in terms of development, but all the others are also making progress. EMEA remains a promising market because business there is stable and there are lots of opportunities

J.N.: We have integrated and non-integrated distribution strategies. It’s specific to each region or even each country. But from an organisational point of view, it’s important to have a strong sales force, capable either of selling direct, or of supporting our partners and enabling them to pass on our product and solutions portfolio, which we see as a single value proposition.

J.N.: In Asia-Pacific, the market is highly fragmented, and BASF Coatings is one of the top premium manufacturers also focused on serving the more fragmented value for money segment. We are seeing more and more local brands and cheaper-to-market brands emerge sometimes blurring the lines with premium brands resulting in a grey area between high-end positioning and the second price level. That is why we have the strongest and most efficient distribution strategy for every market. As for online distribution, this is not a phenomenon that we see much of in North America or Asia-Pacific.

J.N.: 2025 will be like 2024 in terms of the increase in digitalisation and CSR. In this respect, we focused on upskilling and coaching our employees on sustainability and how to talk about it: we are building a common language to enable them to explain this trend in layman’s terms and, above all, to sell products and solutions that address these issues. We have built a tool to assess sustainability in each workshop, in terms of products, energy and people, so that we can offer comprehensive solutions on how to further improve sustainability at their own level.