China auto market to drive 2010 coatings profits - US PPG

21 January 2010 23:23  [Source: ICIS news]

HOUSTON (ICIS news)--PPG Industries’ strongest growth in 2010 will come from its industrial coatings segment, driven largely by continued strength in China’s automotive manufacturing sector, the US chemical and coatings producer said on Thursday.

Industrial segment volumes grew during the fourth quarter of 2009 by 40% in Asia and Latin America, CEO Charles Bunch said during a conference call. However, in the US and Europe, volumes remained more than 15% below year-ago levels due to strong recessionary pressure.

About 20% of PPG’s industrial coatings sales are in Asia, with the automotive original equipment manufacturing (OEM) segment making up a large portion of that market.

Hinging strongly on automotive demand, the segment will see continued growth in Asia, experience a return to growth in North America and remain essentially flat in Europe, he said.

The company’s industrial coatings sector grew its sales by 12% in the fourth quarter versus the year-earlier period, contributing to the company’s improved profits for the quarter.

For 2010, the company expects overall improved earnings, with Asia-Pacific leading the way with as much as 25% sales growth early in the year and with North America benefiting from a year-over-year increase in automotive production.

In other markets, commercial construction demand remained weak globally and no near-term rebound was anticipated in first half, Bunch said.

($1 = €0.71)

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By: Larry Terry
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