BASF has invested €2.5 million (Rs 21 crore) in its Demarchi coatings site, located in the state of São Paulo, Brazil, to expand its capacity to service Brazil’s automotive industry with waterborne automotive coatings.

The goal is to meet market demands generated by new carmakers setting up their plants in the country and by the trend of using waterborne technology rather than solvent-borne. The technology is eco-efficient because water replaces most of the organic solvents.

In addition to the traditional clients such as GM, Volkswagen, Fiat and PSA, and a strong presence in the segment of coatings for trucks, BASF has in the past years conquered new supply contracts which include carmakers such as Hyundai and Chery.

Another trend in the market is the use of integrated processes where the paint line is shortened by one step. This means that less material, time and energy are used. At the same time, the same application quality can be achieved.

In South America, BASF has two plants where automotive coatings are produced, one in Demarchi, Brazil, and the other in Buenos Aires, Argentina.

In 2013, Brazil was the fourth biggest car sales market in the world and on the seventh place worldwide as car producer, according to the International Organisation of Motor Vehicle Manufacturers (OICA).