Market Trends of Seal Coat Industry
This section covers the major market trends shaping the Seal Coat Market according to our research experts:
Rising Demand from Driveways and Parking Lots
- Seal coatings are used to reduce the effects of asphalt binders or other materials used in parking lots or driveway construction, thereby increasing their lifespan. Further, seal coatings provide a layer of protection by blocking harmful intrusions such as water, oils, and ultraviolet (UV) ray damage. These coatings also result in a slip-resistant surface and are aesthetically pleasing owing to their deep black finish, which adds magnificence to the parking lot or driveway.
- Moreover, driveways or parking lots are exposed to excessive chemicals like gasoline and water. Such external elements can weaken and eventually destroy the layers of asphalt. Applying a seal coat acts as a barrier to such chemicals, water, and even UV rays. It also saves money and time spent repairing cracks and damage to the driveway or parking lot, extending its lifespan.
- In North America and Europe, almost every building (small to big housing or high-rise buildings) has driveways and parking lots. Additionally, shopping centers, schools, hospitals, malls, multiplexes, stadiums, airports, etc., have driveways and parking lots. Increasing construction of such buildings and other commercial institutions in these regions is expected to drive the market for seal coats in the future.
- In Germany, construction industry orders were USD 110 billion in 2021, 9.4% higher than in the previous year. The volume of permits for new buildings was close to USD 128 billion, 8% more than the previous year, especially due to rising construction prices.
- However, building permits for dwellings issued from January to November 2022 was down 5.7% compared with the same period a year earlier. In November 2022, the construction of 24,304 dwellings was permitted in Germany. The Federal Statistical Office (Destatis) reported a decrease of 16.3%, or 4,716 building permits, compared with November 2021.
- Further, Europe is expanding in retail, with the construction of new malls across the continent. The Vegas Kuntsevo in Russia, Mall of Scandinavia in Sweden, Westfield Bradford in the United Kingdom, Weberzeile Ried in Austria, Mall of Europe in Belgium, and Lublin Mall in Poland are some of the recent constructions happening in Europe lately.
- Moreover, according to the National Asphalt Pavement Association (NAPA), more than 90% of parking areas in the United States are surfaced with asphalt pavement. Therefore, the new construction of parking areas will significantly impact the demand for seal coats, as they are mandatory for asphalt pavement preservation.
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The United States to Dominate the North American Market
- Seal coats are substances that extend the life of pavements, driveways, roadways, racetracks, and other capital assets by protecting the pavement from the natural aging process caused by water, debris, chemical leaks, ultraviolet rays, and others. Most pavements in the United States are made of asphalt because more than 99% can be reused in other projects.
- As per the National Asphalt Pavement Association (NAPA), about 3,600 asphalt mix production sites operate in the country, producing around 420 million metric tons of asphalt pavement material annually. Every year, the aviation industry witnesses grants and passenger facility charges of USD 4 billion from the Airport Improvement Program, which is spent on airfield runways, aprons, and taxiways.
- In 2022, the US Department of Transportation's Federal Aviation Administration (FAA) announced nearly USD 1 billion in funding from President Biden's Bipartisan Infrastructure Law to improve airport terminals across the United States. The funding will advance improvements at 85 airport terminals throughout the United States to expand capacity, increase energy efficiency and provide greater accessibility.
- Furthermore, the FAA announced that construction is underway on a new air traffic control tower at Asheville Regional Airport (AVL) in North Carolina. The new energy-efficient tower will help the airport meet the growing demand for air travel in the region alongside an expanded and modernized terminal. It will be 127 feet tall and topped by a 440-square-foot cab for three air traffic controllers.
- Furthermore, according to the United States Census Bureau (USCB), the country is also embarking on a significant number of commercial construction projects, all in various stages of development. Some commercial projects underway in the country include the Forbidden City and All Net Arena & Resort in Las Vegas, the Ko Olina Atlantis Resort in Hawaii, the Miami Herald Redevelopment in Florida, and The Wharf - Phase 2 in Washington DC. The development of all such projects will require the construction of new driveways and parking lots, increasing the demand for seal coats in the coming years.
- Furthermore, about 35% of the asphalt pavement expenditure in the country is recorded in the residential and non-residential construction segments. Besides, the expenditure of the United States on commercial building construction is estimated to grow by more than 4% annually over the forecast period. With the increased trend of nuclear families in the country, apartments have become one of the major preferences, leading to the construction of high-rise residential buildings and townships, thus increasing parking spaces, walkways, and driveways in such segments.
- Therefore, these factors are expected to boost the demand for seal coats in North America, propelling the overall industry's growth.
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