the newsmagazine off the chemical world VOLUME 36, NUMBER 22 | JUNE 2, 1958

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Paint Sales Fall 7% in First Quarter— 5% Drop Seen for the Year Millions of dollars (D Total Sales Λ Π Industrial Sales I Trade Sales

Mi

Industrial segments of coatings trade hard hit to date , producers see over-all sales off 5 % in '58

.LNIEWCOMERS to the paint industry are always told that it's "depression-proof." This week, a few may be wondering in view o f a 7 *9<? industry sales drop in the Erstqiaarter (C&EN, May 19, page 13) , b u t most p roducers look for a pickup soon, A feAV already claim to see signs of the turn.

M a n y agree with D u Pont 's pro­jec t ion that paint sales for the year will b e down about 5 % . This means a drop of $80 million, and nearly all of it will b e los t in industrial business. Trade sales, AvhicL· amounted to $956 million in 1957, will remain at about the same level. In the first quarter, while in­dus t r ia l sales were off 14.47c, t rade sales were only down 2.09r, and a poor March, was t he only reason the group s h o w e d that small loss.

• Suppliers Optimistic. Recently, paint industry suppliers have become increasingly optimistic. Du Pont re­ports that its pigments business is down

"slightly" b u t that both white and color sales have picked up lately. It's done some pigment plant rehiring. Normally there is a seasonal rise in spring, but officials say this is a pickup above any seasonal shift. Du Pont is a major

pigment supplier, just last month an­nounced a new family of organic reds.

Part of the reason for the good trade sales outlook is the rapid and continu­ing growth of latex emulsion finishes: styrene/butadiene, polyvinyl acetate,

Auto spray booths aren't quite as bare as this symbolically empty one at Chrysler, bu t low auto output has undoubtedly chewed into paint sales

J U N E 2, 1958 C & E N 2 1

Paint Makers See Turn Ahead

CHEMICAL AND ENGINEERING NEWS

acrylics, and new mixed copolymers. Most paint companies report booming sales here: United Wallpaper (con­trolled by Sears, Roebuck ) , "biggest seller is latex finishes"; Devoe & Rey­nolds, "vinyl latex for interiors is selling like hotcakes" are typical comments, echoed throughout the trade.

Effect: latex emulsion suppliers are having a fine time. W. R. Grace's Dewey & Almy division recently an­nounced plans to more than double PVAc and styrene/butadiene emulsion capacity. Rohm & Haas, major acrylic producer, tells C&EN that its acrylic emulsion sales for paint are up 15% through the end of April compared to last year.

The paint industry had 1957 sales of $1.6 billion. The major producers are well known names. In estimated order of size the big five are:

1957 Total Sales

Posit ion ( M illions in Paint of

Sales 1 2 3

4 5

Company Sherwin-Williams Du Pont Pittsburgh Plate

Glass Glidden American-Marietta

Dollars ) 257.8

1964.6 620Γ8

225.5 234.0

Many companies are in the fight for the next several positions. Typical among these is Devoe & Reynolds (fiscal 1957 sales of $57 million).

While paint and paint products ac­count for nearly all of Sherwin-Wil­liams' sales, this is not the case with Du Pont and the other three. Of these four, Glidden is the only one which breaks its sales down into product groups: paint—34% or $76 million; three groups which have some sales to the paint industry: southern chem­ical (naval stores)—4% or $8 million, chemurgy—16% or $35 million, chem­icals-pigments-metals—7% or $17 mil­lion; and a last group outside the trade: f ood -39% or $89 million.

• Effect on Companies. Du Pont notes that while its trade sales are only off "a bit" thus far in 1958, it expects them to stay about level for the year. Its industrial sales ( most likely, Du Pont is the country's largest industrial and automotive seller) are now down 10 to 1 5 % , in line with reduced industrial loroduction. Automotive sales are nat­urally down with lowered car output. However, Du Pont's refinishing busi­

ness is holding its own, and that's the report from others in the field. In its newer products, automotive acrylic lac­quers are ckiing well. Officials say that these are getting to be the major portion of its sales, and likely in a few years will about take over from its older lacquers.

Du Pont's paint selling prices are no higher than last year, and officials note that while a few raw material costs are down, lower volume has pushed over­head up ; and that, added to higher labor costs, has again sent total costs skyward. A few in the industry do report higher selling prices now, or coming soon. Many have spent a lot on promotion. The Bureau of Labor Statistics' prepared paint price index stayed constant at 128.4 through the first quarter.

While its paint division sales are off as a whole, Pittsburgh Plate Glass ob­serves that trade sales to date are up more than 57c. It too has been hit by lower automotive sales, both in paint and glass. Spokesmen cite its general trade sales picture as "outstanding." It has recently added two new series modified from a basic thermosetting acrylic baking enamel. Reason for PPG's high hopes here: less cost and lower baking schedules in the new series. It agrees with Du Pont's price observation: costs up over-all, selling prices level.

United Wallpaper says its biggest seller so far this year is latex finishes,

followed by high quality satin enamels. Prices are about the same as last year.

Devoe & Raynolds says trade sales are up compared to last year, while in­dustrial items are down slightly due, again, to the auto slump. The firm put through a general price increase the first of the year. Now, however, it's in the midst of a sales push on some items and is offering them at lower prices. Net effect: Current prices are about the same as last year, but after the pres­ent sales promotion drive is over (in a couple of weeks) prices will go up.

To one big supplier to the paint in­dustry, it looks like dollar sales volume of industrial surface coatings is off about 14%. This firm notes that sales of industrial coatings always correlate with steel production. Based on pres­ent indications that steel output will rise to about 6 0 % of capacity in the coming months, the firm looks for a corresponding rise in paint sales.

The same company notes in passing a fairly prevalent theory on why trade sales have held up relatively well. The idea is that industrial workers who have been laid off go out and buy them­selves some paint and get to work on a deferred job on the house.

A 57o over-all decrease for the year isn't too bad, particularly in the light of low auto and appliance outlets, and that poor first quarter. But selling is the heart of the paint man, and the in­dustry can be expected to push hard from here on in.

Synthetic resin cooks in a huge kettle at a Reichhold Chemicals plant in Detroit. One big supplier to the paint industry notes that its sales are 5 to 10% under last year, down slightly less than paint sales themselves

2 2 C & E N J U N E 2, 1958