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Consolidation trends signal major change

Consolidation among the refinish paint brand manufacturers has led to many changes, both on a financial and industry level.

There are three key markets for automotive paints - Europe, North America and Asia. Until last year's purchase of Herberts by DuPont, no single paint manufacturer held a major part in more than one of these markets, but now DuPont has major market shares in both the USA (30%) and Europe (33%).

This consolidation could start to have an impact on paint distribution in the UK through the polarisation of both the repairer and distribution sectors. Medium-sized distributors and bodyshops are beginning to be squeezed out of the market or being taken over by larger groups.

The national paint distribution group Brown Brothers was first taken over by Partco and then, more recently, by Unipart. The implications for Brown Brothers (the national distributor for ICI Autocolor) of PPG's purchase of ICI has not yet fully been recognised.

The independent distribution sector is separating into three groups – the independent distributor alliances such as NIBS and Trade, the exclusive manufacturer groups such as NDG (Standox) and UPD (DuPont), and the one-off independents.

It is almost inevitable that the strategic decisions regarding the direction and philosophy of individual paint brands and distributors will become more remote from single markets. Instead, they will be made in the context of more national and global marketing strategies.

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