PPG Zhangjiagang to build worldwide largest coatings production base 08-04-2017

According to market intelligence firm CCM, China’s subsidiary of PPG Industries, PPG Zhangjiagang, has announced to expand its production lines of packaging coatings, industrial coatings, and automotive paints. This move will make the facility the worldwide largest coating production base.


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The current largest coating production base is PPG Paints, another subsidy located in Tianjin, China. PPG Tianjin was PPG's first factory in China, and is mainly engaged in the production of high performance automotive coatings and industrial paints. In 2016, sales and output from the plant reached USD782.03 million and 110,000 tonnes respectively.  


PPG Zhangjiagang was established in 2005 and has undergone several expansions since then. Zhangjiagang's new construction will actually be the fourth expansion to the production base.  


PPG has recently accelerated investment and capacity expansion in China. This can be attributed to pressure from AkzoNobel, one of PPG's rivals, which is developing rapidly, and the promising future of China's vast coating market.  


In January 2016, the company has opened a USD20 million center for on-site electrocoat coatings in the Zhangjiagang facility. The center was mainly opened to meet the high demand in the automotive-manufacturing industry in China, which is in line with the growing environmental regulations in China.  


What’s more, PPG was the first company to introduce electrocoat technology commercially in an automotive original equipment manufacturer assembly plant already in the 60s. E-coat technology offers high coating uniformity and efficiency as well as superior corrosion protection.  


China’s coatings market

China's coating market is offering a promising future, which drives the investments of many players in this industry in China.  


According to CCM, since Jan. 2017, domestic coating companies have invested over USD6.20 billion in new coating projects, with the newly increased capacity exceeding 9 million t/a.  Both foreign-funded enterprises, such as Nippon Paint, PPG Industries, Sherwin-Williams and AkzoNobel, have invested to increase capacity.  


Analysts pointed out that the trend of capacity expansion is due to the fast growth of China's coating market, which offers great opportunities for enterprises to strengthen their position. Although China's coating output has top the world, the relatively low per capita consumption indicates huge development space for the coating industry. Thus, occupying market share is of vital for coating companies.  


The 2017 Top 100 Coating Enterprises in China, a list published by Coatings Industry and based on companies' coating sales in 2016, puts PPG China in third position (USD1.58 billion) behind AkzoNobel and Nippon. PPG is optimistic about the future of China's coating market, and will definitely strengthen its market position and expand in the future.  


On 3 May, 2017, HC International Inc. (HC Group), a well-known domestic coating information provider, published a report on the output of China's coating industry in Q1 2017 on its website (coatings.hc360.com). According to the report, China produced a total of 4.27 million tonnes of coatings in Q1 2017, up by 10.10% YoY. Output increased rapidly in the top 3 producing areas; Guangdong, Jiangsu and Shanghai Province/Municipality produced 891,200 tonnes, 535,300 tonnes and 466,100 tonnes of coatings respectively in Q1, up by 17.40% YoY, 8.80% YoY and 20.90% YoY.  


On 17 April, 2017, the National Bureau of Statistics of the People's Republic of China (NBS) released the national economic index, revealing a prosperous domestic economy. The coating industry, its downstream industries, and the real estate industry all maintained steady growth rates in Q1 2017.  


PPG Industries, Inc

The parent company of PPG Zhangjiagang is PPG Industries, Inc., an American manufacturer of paints, coatings, and specialty materials. The enterprise is the largest coatings company in the world, based on the yearly revenue.  


In late July, PPG has revealed to acquire The Crown Group, which is specialising in applying coatings to manufacturers and assembled parts, mainly in industry segments like automotive, construction, and alternative energy. The acquisition is going to enhance PPG’s role as the world leader in the coating industry.  


The Zhangjiagang subsidy was opend in 2011 as PPG’s first resin plant in China, with the purpose of supplying PPG coatings businesses as well as customers in the Asia Pacific region alike.


Abbout CCM

CCM is China's largest market insights provider in the coatings and TiO2 industry. For more information, check out our Newsletters, Reports, and Market Data.

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