Even though DuPont's automotive paints, or "performance coating," division brought in 12.1 percent of the firm's 2010 revenue, the pretax operating-profit margin was only seven percent, said to be about "half the corporate average." With the highly diversified firm making plays in more lucrative "megatrend" areas, Automotive News reports that DuPont has retained Credit Suisse to find a buyer for its two coatings divisions valued at $3-4 billion.
An analyst has said selling the units will improve the portfolio, but the question is what other company will have the will (and the financial wherewithal) to take them. DuPont says it wants to up the division's profit margins to ten percent in 2012, but with automakers still hammering supplier prices, it will take some healthy productivity engineering to make that happen. Credit Suisse hasn't begun the sale process yet, but a buyer could be sought among the other three large auto-coatings companies, PPG, BASF and Arko Nobel.


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    • 1 Second Ago
  • 5 Comments
      TMTexas
      • 3 Years Ago
      I've never heard of Arko Nobel. AKZO Nobel is one of my clients, but I've never heard of Arko . . . Do these authors proof read before they post?
        • 3 Years Ago
        @TMTexas
        [blocked]
      andrew.robertson
      • 3 Years Ago
      I believe that you meant Akzo Nobel as the third company and not Arko Nobel.
      ss1591
      • 3 Years Ago
      I was a DuPont Paint jobber for 27 long years and can tell you that they need to sell. This division is a mess with people that hate what they do and would rather sit on their rears then see customers! The products they make were as good as any other products but their disdain for their Paint jobbers was so bad we hated when they came in. It was so bad we called them King DuPont because they only cared about themselves. The real problem with them selling is there are to few companies that can afford to buy them and then continue to pump in the massive funds for R&D. The justice department also will not allow the other companies to buy them because of to little competition this happened before when BASF was trying to unload its paint division. But good job to DuPont for making this public so their paint jobbers will now have an even harder time selling their products due to customer fears! By the way jobbers are the companies that sell paint wholesale to body shops and the end users!
      Eyhk
      • 3 Years Ago
      Fleeing upmarket for better profit margins until you have no more market? Textbook case of Clay Christensen's Disruption Theory