A urethane reducer is essentially a paint thinner designed specifically to work with the urethane-based paints typically used on automobiles, according to Dennis Parks and David Jacobs, authors of "How to Paint Your Car."
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Reducers vs. Thinners
Reducers and thinners are both paint solvents. The term "reducer" applies to solvents for urethane and enamel paints. Thinners are used for lacquer paints. The ingredients of urethane, enamel and lacquer paints differ from each other, as do their solvents.
Function of Reducer
Paint must be liquid to allow for application. A urethane reducer allows you to adjust the consistency of the paint to make it easy to spray on the car surface. The reducer then evaporates, allowing the paint to set and harden.
The choice of a reducer also depends on the temperature of the work area. A reducer that evaporates quickly works better in cooler temperatures. A reducer that evaporates more slowly works better when hot. Reducers are also rated for differences in humidity.