Is it general inflation, the cost of oil or increased demand?
When it comes to paint protection film (PPF) prices over the past few years, it’s likely all three.
Inflation
Almost no product has escaped general price increases due to inflation—including PPF. Data from the St. Louis Federal Reserve’s producer price index has polyurethane, the base material for PPF, up more than 20% since 2020.
A graph of the St. Louis Federal Reserve’s data on polyurethane prices.
“We have seen expected and reasonable price increases on certain products,” says Manny Hondroulis, vice president at Energy Products Distribution. “In many cases, we have been surprised that we haven’t seen more.”
Manufacturers play a big role in the decision on whether price increases trickle down to the end user. Joe Cobbe, president and CEO of Maxpro Window Films, says that while their prices have gone up, the company has to be choosey as when to pass those costs along.
“You measure the level of pain. Watch your margins and while there’s no set number—the overall picture is not just the margins – it’s advertising, rent, utilities, etc.,” he says. “You eat cost increases as much as you can. Competitor pricing also has a lot to do with it.”
Hondroulis says it’s harder for distributors to eat the cost of those price increases because distributors have a smaller margin.
“It’s difficult to service customers, provide them and your manufacturer value, and invest for growth when taking margin hits,” he explains.
Oil
Polyurethane is made ultimately from oil, prices of which have also spiked, affecting not only the raw material prices but also the cost of shipping.
Since 2020, oil has remained above the 10-year average per barrel and is currently hovering around $90 per barrel and trending upward.
“Supply chain disruption and the huge increases in shipping costs have a much bigger impact [than raw materials],” Cobbe says.
Hondroulis agrees from the distributors’ perspective.
“The only thing we can depend on is them increasing in the foreseeable future due to rising fuel and labor costs,” Hondroulis says.
Demand
Customers are also demanding more PPF. Demand has attracted more suppliers but also more of a pull on the overall film supply chain. Cobbe doesn’t see demand slowing down and is currently leading Maxpro through a production capacity expansion because of it.
“I thought five years ago the market was saturated. I thought everyone was in the game and that was the end of that,” he says, but now sees the industry growing not just in the U.S. but internationally—notably in Europe.
Window film dealers have also gotten better at moving more product.
“A lot of people are easing into it with door handles,” Cobbe says. “That’s a great money-maker for the tint shops because the cost is really cheap.”
