634 billion business sale! basf partners with xiaomi to "play with colors"

Recently, the deep partnership between BASF Coatings and Xiaomi has reached a critical upgrade. The two parties announced that they will jointly develop 100 exclusive automotive paint colors over the next three years. This collaboration, centered on "personalization," is in fact a precise grasp of automotive consumer trends.

As Xiaomi's paint partner since 2023, BASF has provided a full-chain solution for models such as SU7 and YU7: from the corrosion-resistant CathoGuard® 800 electrophoretic layer, to the scratch-resistant SecuBloc mid-coat, to the vibrant ColorBrite water-based paint and the enhancing ProGloss clear coat, forming a complete system of "four-layer protection + aesthetic expression." The first batch of five distinctive colors also conceals technical secrets.

Racing Red: Custom lacquer enhances color saturation by 20%, remaining vibrant even under strong light.

Lustrous powder (matte): Matte varnish creates a foggy texture, with a tactile feel similar to that of frosted ceramics.

Twilight Rose: The combination of aluminum powder and pearlescent pigment achieves a color-changing effect under both warm and cool lighting.

Tender Bud Yellow: Triple pigment layering technology, addressing the industry pain point of high-saturation yellow fading easily.

Amethyst: ProGloss dual-layer lacquer overlay creates a crystal-like mirror finish.

BASF's Vice President for Asia Pacific, Jack Zou, candidly stated, "Every shade is a language of personality," and the sales data from Xiaomi's flagship store corroborates this point—consumers in Guangdong have a high demand for shades like ash gray and purple, while the Shenzhen market prefers low-saturation colors like olive green. Color is becoming a core weapon for automakers in differentiated competition.

In 2024, data shows that the domestic automotive coatings market has reached a scale of 42.517 billion yuan, with the combined demand for original equipment manufacturer (OEM) coatings and parts coatings totaling 528,000 tons. Two major growth drivers are particularly prominent:

1. Consumer End: From "Black and White Domination" to "Color Freedom"

BASF's 2024 Color Report reveals significant changes: the market preference for white vehicles continues to decline, while the demand for gray and black is steadily increasing. The demand for yellow has nearly doubled, and green has also seen substantial growth, while traditional favorites like blue and red have experienced a slight decrease. This shift is more directly reflected in the automotive industry—Xiaomi users collectively called for the introduction of a "Macho Pink" color, prompting the official response of "more color options will be launched," indicating that personalized colors have become a core selling point of customization services.

2. Industry side: New energy vehicles open up incremental space.

The recovery in passenger car production and the explosive growth of new energy vehicles are driving demand from two fronts, especially with the "three electric systems" creating new requirements: battery packs need protective coatings that resist electrolyte corrosion and impact, while electric motors and controls rely on high-temperature resistant coatings. The unit price of these functional coatings is 2-3 times that of traditional products, directly boosting market size.

For a long time, the passenger car body coatings market in China has been dominated by foreign brands. The global rankings for 2025 show that PPG, Axalta, and BASF remain in the top three, with BASF leading the Chinese market with a revenue of $2.823 billion, followed closely by PPG and AkzoNobel. However, the wave of new energy is reshaping this pattern.

1. Strategic Adjustment of Foreign Investment Giants

BASF recently announced the sale of its automotive OEM coatings, refinish coatings, and surface treatment businesses for 7.7 billion euros (approximately 63.44 billion yuan), with the transaction expected to be completed in the second quarter of 2026. This move has been interpreted as a strategic contraction to "focus on core technologies," which, conversely, creates a window of opportunity for domestic brands.

2. Multiple Breakthroughs by Domestic Forces

A group of Chinese paint companies have made breakthroughs in supplying main engine manufacturers: Zhongshan Bridge Paint has entered the Changan supply chain; Huatu Paint is supplying Geely and FAW; Huahui Paint has received joint investment from BYD and Xiaomi, and is also supplying AITO models.

Furthermore, the competition in automotive coatings has long surpassed the elementary stage of "attractive colors." The battleground in 2025 will focus on three key dimensions:

1. Environmental Technology Iteration

Under policy pressure, high solid content, water-based, and bio-based coatings are accelerating the replacement of traditional solvent-based products. The ColorBrite waterborne paint that BASF provides to Xiaomi reduces VOC emissions by 60% compared to traditional products, but the price of such environmentally friendly coatings is also 30%-50% higher, testing the cost control abilities of companies.

Functional Innovation

New energy and intelligent networking drive new demands: battery pack coatings need to balance corrosion resistance and lightweight properties, sensor area coatings require low dielectric constants to avoid signal interference, and even automotive glass inks need to withstand acids and alkalis for over 72 hours. These customized products have extremely high technical barriers, and their gross profit margins can reach twice that of traditional products.

3. Ecological Collaboration Ability

From BASF and Xiaomi's "Three-Year 100 Colors" plan to Huahui receiving joint investment from BYD and Xiaomi, the collaboration between paint companies and OEMs is shifting from "passive supply" to "proactive co-creation." As industry experts say, "The winners of the future will not only be those who can mix colors that consumers like, but also those who can solve the technical pain points of car manufacturers."