AkzoNobel launches Chengdu plant

Leading global paint and coating company AkzoNobel broke ground on its new decorative paints site in Chengdu, Southwest China's Sichuan Province, a move indicating the company's strategy to further expand into the western region of the country.

The new decorative paint production site, which is expected to be finished in 2017, will be built with an investment of 44 million euro ($58.61 million) and cover up to 55,000 square meters, the company said.

The plant, which will be AkzoNobel's fourth paint production base in China, is going to bring nearly 100 jobs to Chengdu, the firm said.

Other than Chengdu, the company has production bases in Shanghai, Guangzhou in South China's Guangdong Province, and Langfang in North China's Hebei Province.

In 2013, AkzoNobel had revenue of 1.6 billion euros in China, making the country the company's second-largest market.

The China market is dominated by foreign paint companies due to their brand recognition and higher quality, Wang Jianchao, a partner specializing in the paint and coatings industry with Adfaith Management Consulting Inc, told the Global Times on Wednesday.

"Domestic companies are trying to catch up with their foreign rivals," Wang said, but added that most lack integration of the whole industrial chain.

Paint and coatings enterprises have to focus on environmental protection, Xiu Guangli, associate director with the School of Resource and Environmental Engineering, East China University of Science and Technology, told the Global Times.

The country's sluggish real estate market will also have a negative impact on the paint and coatings industry, which will see slow growth in the future, Wang said.

"Big companies with good reputations could still grasp a bigger market share. But for small-sized companies, they need to face up to the possibility of going bankrupt," Wang said.