The Indian auto industry, which has started to show strong growth since last 4-5 years, is emerging as a major export hub for the global market. As a result, automotive coating market - especially the refinish coating segment - has been growing in double digits. With increased automobile sales, the demand for automotive coatings is also expected to grow, says Vinay Rajadhyaksha, Managing Director, Axalta Coating Systems India Pvt Ltd. With stricter emission norms and focus shifting towards healthier and sustainable environmental regulations, demand for water-based coatings from automotive OEMs is expected to see a significant increase. In this interview with Rakesh Rao, Vinay Rajadhyaksha tracks emerging trends in coating markets and how environment will play a crucial role in shaping the future demand for coatings.
Axalta had invested to expand its Technology Center in Savli last August and that will facilitate adoption of our coatings by auto OEM customers. In next 4-5 years, Axalta expects growth in the OEM - transportation coatings business in India.
The investment is in line to support the growth in auto industry and the need to provide sustainable and environmentally responsible products. In India, Axalta’s product portfolio covers the entire range of requirements of transportation coatings, refinish market and industrial coatings.
Few months back, Axalta’s Chairman and CEO Charlie Shaver gave a talk on sustainability at IIT Delhi. According to you, how important are sustainable business practices, especially in India?
Axalta is known for its innovative coatings that are sustainable and environmentally responsible. The campus talk at IIT Delhi kicked off the Axalta India STEM (Science, Technology, Engineering and Mathematics) education programme in line with Axalta’s global initiative which aims to create awareness and educate local academic communities on technology and industry trends related to coatings.
Under the STEM education programme, Axalta works with universities on scholarships, internships and other co-op programmes to equip the future workforce with skills and training on coating technologies and sustainability.
India is a strategic market to us in the Asia Pacific region. Axalta has been doing business in India since 1996 and has continuously invested in India over the last two decades. So while Axalta continues to invest in technological innovation and manufacturing facilities in India, we also invest in the education of our future leaders who will continue our legacy in innovation and sustainability for the coating industry. Axalta has been a leader of waterborne technologies, one of the most important eco-responsible coating solutions in the industry. And India being a significant market for us, sustainable business practices in India are therefore very important to us. Sustainability will impact India and its automotive industry which is poised to become the third largest in the world by 2020.
With more than 150 years of industry experience and expertise, we feel that Axalta can be a good facilitator to unite stakeholders in India and around the world to achieve a common goal of sustainability. Innovation and continuous commitment to R&D are crucial in simultaneously discovering advance coating technologies that are also sustainable. It is important that the next generation of leaders learn about sustainable business practices now in order to help our industry continue to evolve, so we can enable a better and cleaner world going forward.
Axalta’s continuous investment in upgraded manufacturing and technology provides a more sustainable and colourful world to industries. Axalta serves the society as a whole. Our manufacturing facilities are ISO 14001 certified. The Savli plant is a zero-discharge site.
In the recent past, the industry’s per capita consumption in India has been around 3.34 kg which is relatively lower than that of global and Asian per-capita consumption of more than 20 kg and 9-10 kg, respectively. With lowering of interest rates leading to the anticipated growth in the manufacturing sector, the demand for industrial coatings is also expected to grow.
Industries that are driving demand are – automotive, consumer appliance, agricultural and construction equipment.
We expect the coating market to shift to increasingly environmentally responsible products that are both waterborne and low emission high solid solvent-based. Axalta has excellent portfolios in both segments. Also, with limited capacities in OEM approved body-shops, especially in metro areas, there is a growing focus on productivity improvements which has triggered demand for new technologies like Faster Clears and Quick Repair systems.
For our Indian operations, the automotive sector is a vital business provider including the aftermarket segment. And now with the new facility at Savli, it will help the company to expand into new areas like supplies to passenger cars and commercial vehicles. Overall the Indian automotive market looks positive and we hope to get good business in the times to come.
Government aims to build India into a global manufacturing center and a R&D hub and localising in India makes supply chain simpler and helps meet customer specific needs.
Domestic and global auto majors have long term plans for the Indian market, which augur well for automotive paint manufacturers. Increased industrial paint demand, especially powder coatings and high-performance coatings will also propel topline growth of paint majors in the medium term.
Going ahead, 2018-19 is expected to see a gradual upward trend in input costs. This rise requests us to be continuously focused on innovation and customer services by leveraging our investments in R&D and manufacturing facilities as well as our strong global brand and market position.
The good news for India is that, while comparing with most parts of the world, India is fairly pro-business with availability of good raw materials, workforce and skill set. Our growth in India has been strong year-over-year with double digits growth rate. We will definitely keep up the growth in India with our leading technologies and expertise as a leading global coatings manufacturer.