Seal Coat Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Key Highlights

• The increasing commercial construction activities and pavement construction, coupled with rapid industrialization and urbanization, are some of the major factors driving the global seal coat market.
• The seal coating market may not grow as fast as it could because of strict rules about the environment and health risks caused by polycyclic aromatic hydrocarbons (PAHs), which can cause cancer.
• Rising refurbishment and repair activities in developed and developing countries are likely to offer new growth opportunities for the industry.
• North America dominated the market across the globe, with the largest consumption of seal coating in countries such as the United States and Canada.

Seal Coat Market Trends

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 UV ray damage.
• These coatings also result in a slip-resistant surface and are aesthetically pleasing owing to their deep black finish, which adds a level of magnificence to the parking lot or driveway.
• Moreover, driveways or parking lots are exposed to excessive chemicals, such as gasoline and water. Such external elements can weaken and eventually destroy the layers of asphalt. The application of 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 Germany, orders for the construction industry had a value of Euro 94.6 billion (USD 110 billion) in 2021, 9.4% higher than in the previous year. The volume of permits for new buildings was close to €110 billion (USD 128 billion), 8.0% more than in the previous year, especially due to rising construction prices.
• However, several building permits for dwellings issued from January to November 2022 were 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) reports that this was a decrease of 16.3%, or 4,716 building permits, compared with November 2021.
• Additionally, shopping centers, schools, hospitals, malls, multiplexes, stadiums, airports, etc., have their driveways and parking lots. Increasing the construction of such buildings and other commercial institutions in these regions is expected to drive the market for seal coats in the years to come.
• Furthermore, rising infrastructure development in Europe and Asia-Pacific countries is expected to boost seal coat consumption.For instance, the B-247 Highway is one of the major road construction projects in Germany, a 22-kilometer highway from Mühlhausen to Bad Langensalza. Construction work started in Q1 2022 and is forecast to be completed by Q4 2025.
• Moreover, according to the National Asphalt Pavement Association, more than 90% of surface parking areas in the United States are surfaced with asphalt pavement.
• Therefore, the new construction of parking areas will significantly impact the market demand for seal coats, as they are almost mandatory to be used for asphalt pavement preservation.

The United States to Dominate the North American Market

• In the country’s transportation networks, seal coat is used in numerous areas, including paving roads, parking lots, airports, biking and walking trails, and other paved surfaces. Most pavements in the United States are made of asphalt because more than 99% of it 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 per year.
• 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 Federal Aviation Administration (FAA) awarded USD 15 million in Bipartisan Infrastructure Law funding for a project worth USD 44 million. The new tower will be 127 feet tall, topped by a 440-square-foot cab with three air traffic controllers. The approximate 13,300-square-foot base building will house the Terminal Radar Approach Control (TRACON) with five air traffic controllers.
• Furthermore, according to the United States Census Bureau, the country is also embarking on a significant number of commercial construction projects, all of which are in various stages of development. Some of the 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, which in turn will increase the demand for sealcoaters in the years to come.
• 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 forecast 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 aforementioned factors are expected to boost the demand for seal coats in North America, thereby propelling the overall industry's growth.

Seal Coat Market Competitor Analysis

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