PPG Industries, Inc. (NYSE:PPG) Q4 2022 Earnings Call Transcript

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Vince Morales: Yes. I’ll answer the color, Dan, to the aerospace figures here. So we said before, aerospace is circa $1 billion business for us. This $200 million backlog is typically a small fraction of that. So this is almost another two months of activity. If we can get it done this year, we’re still facing some supply challenges that are governing what we can do in a particular month or quarter, but it is a significant backlog relative to historic terms.

Tim Knavish: Yes. And I’m going to grab that back one more or one more comment. The demand in aerospace is actually growing as we progress through the months and quarters. So you’ve got kind of the underlying demand is growing, which means that $200 million backlog is going to be there even longer. And recall that China, international travel only opened on January 8, so that’s going to be another stimulus for aerospace demand.

Operator: Our next question comes from Mike Harrison of Seaport Research Partners. Please go ahead, Mike.

Mike Harrison: In the auto OEM business, a question on electric vehicles that hit 10% of global car sales last year, I was hoping that you could give us an update on some of the key products that you’re providing for electric vehicles. Any recent wins or other metrics you can share on that portion of the auto OEM business?

Tim Knavish: Yes, Mike, we’re really excited about EV because we are winning where the EVs are winning, okay? We’re winning where the EVs are gaining the most and that giant. You probably saw the journal article here not that long ago. It’s something like 65% or so of the EVs sold last year wherein in China, and that’s where we’re having the most success. In fact, we’re growing significantly with the largest EV producer in China. The way we’re approaching is, it’s not only about new technologies, it’s about picking the winners on the EVs and selling, let’s say, more conventional corrosion protection and beautification products to those customers. So it’s a combined effort of selling our new and differentiated products like our battery fire protection, and our dielectric coatings products to those customers, but also targeting and winning with the EV winners in the market.

Operator: Our final question today comes from Jaideep Pandya with Enfield Research. Please go ahead.

Jaideep Pandya: partly because of the crazy raw material inflation you’ve seen. Now as raw materials tail off, are you not getting pushed back from your customers when you’re trying to do these targeted pricing, especially in a demand environment, which has at least changed and has slowed? That’s my first question. And the second question really is on protective. Could you just tell us like what’s the backlog in marine and protective these days?

Tim Knavish: Jaideep, I’m sorry, the beginning of your first question kind of — I apologize, but if maybe you could repeat your first question for us, please.

Jaideep Pandya: Yes, sure. Sure. So my first question is just on the pricing.

Tim Knavish: I get the first question.

Jaideep Pandya: Yes. It’s just on.

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