Nippon Paint Decorative Coatings Thailand expects the domestic paint market will fall more than 15% in 2020 year-on-year, with dim prospects continuing next year as the economy stalls thanks to the pandemic.
The Thai painting industry is usually valued around 25 billion baht per year.
“Paint industry growth depends largely on the economy, especially the construction sector,” said Watchara Siriritthichai, general manager of Nippon Paint.
“Though the construction business appeared to recover in the third quarter, the overall business is still not good.”
The construction sector is expected to drop by 10-15% this year because purchasing power is weak and people are not buying property.
Even next year, Nippon Paint expects the domestic paint industry will not fully recover as the economy will likely still be reeling from the pandemic.
The company believes some construction businesses, especially those in the residential segment, will recover in 2021, helping boost demand for paint products in Thailand.
Mr Watchara expects Nippon Paint will manage to keep 2020 earnings close to those of last year, before seeing them pick up again to double-digit growth next year.
He is still hoping for 20% growth as originally estimated.
Nippon Paint is the largest paint maker in Asia and fourth largest in the global market.
The company earlier this year announced a partnership with three major construction firms to develop new products and coating solutions for customers.
This is the first time Nippon is matching painting technology with construction businesses run by its new partners: Sweden-based Terraco Industry Thailand, US-based Craco and Finland-based Mirka.
Mr Watchara hopes the collaboration will help construction businesses better deal with the fallout.
“The pandemic affects the Thai labour market, which depends on construction workers from neighbouring countries,” he said. “We believe new painting technology will help save costs and increase efficiency.”
The company described the cooperation as unique, working together to develop innovative products that are easy to use and help workers save time.
Terraco said earlier it is ready to help the collaboration with technological know-how.