“We successfully kept a tight control on costs while effectively managing our raw material spend”
It was a very challenging year, in Europe especially, but we achieved growth in many of our key countries and in all market segments. We focused on running a tight, efficient business in order to withstand the economic headwinds and we successfully kept a tight control on costs while effectively managing our raw material spend through value engineering.
The European automotive aftermarket was heavily impacted by the weak economy, with the drop in miles driven and accident and repair rates putting pressure on volumes at our vehicle refinish business. We didn’t lose market share, if anything we gained slightly, but there was a major slowdown, particularly in Eastern and Mediterranean Europe. Nevertheless, we did achieve growth – albeit off a smaller base – in Turkey and Russia, as well as the Middle East and Africa. Growth also continued across Asia, although somewhat slower than in recent years, while North America was a little sluggish. Having turned in a very good 2011, our Automotive Specialty Plastics business put in another strong performance, notably in North America, where it had its best ever year in terms of growth. We effectively leveraged the business’ global footprint to take advantage of a big uplift in unit builds. Aerospace, meanwhile, continued to gain momentum and achieved another record year by growing ahead of the market on some strong leading indicators in the OEM new build sector and with many of our key airline and general aviation customers.
We maintained focus on improving our product and services offer and the introduction of our click&go technology was a significant development for our bodyshop customers. The system is made up of a special frame which holds disposable paint pouches. Ready in seconds, it allows for perfect mixing ratios, reduces waste and can be fitted directly onto a spraygun. We also continued to invest in our ongoing efforts to digitize color. Our IT experts and color researchers have been working together to ensure that we continue to deliver perfect matches for our customers while doing away with traditional tools such as color fans. We now use sophisticated technology to digitally measure color with a system which provides all the relevant technical data, as well as the mixing formula. Another important highlight was the expansion of our technology partnership with McLaren Automotive to include road cars. It builds on the success of our existing corporate partnership as the official supplier of innovative paint solutions to the Vodafone McLaren Mercedes Formula 1TM team.
Our stickerfix quick repair solution continued to do well and we launched a pilot internet shop for the consumer market in the Netherlands which has proved to be very successful. We expect to roll out more shops in the US and Asia Pacific in 2013. In China, we broke ground on our new plant in Changzhou, which is expected to start production in early 2014. In addition, we received bodyshop approvals from several car manufacturers, including Peugeot in Brazil and Nissan in India, while our Aerospace business launched a new Aerofine range of interior cabin coatings. We are also preparing to launch a best-in-class global ERP system across the business, which will make things more efficient for us and for our customers.
Geo-mix revenue by destination