Application of thick HVOF coatings on metallic parts has been widely accepted as a solution to improve their wear properties. Adherence of these coatings to the substrate is strongly influenced by the residual stresses generated during the coating deposition process. So far, residual stress development in plasma sprayed coatings has been studied in detail by various workers both experimentally and by finite element (FE) modelling. Stress generation during the plasma spray process is mainly attributed to phase transitions in the coating material during the deposition process, quenching stresses due to splat solidification and secondary cooling stresses due to the differential cooling of the substrate and the coating to room temperature. Final residual stress in the coating is obtained by superimposing the individual stresses generated due to these factors. However in an HVOF spraying process, due to the relatively low processing temperature, significant peening stresses are generated due to the impact of semi-molten particles on the substrate. At present, FE models of residual stress generation for the HVOF process are not available due to the increased complexities in modelling the stresses generated due to the particle impact. In this work, deposition of an HVOF sprayed copper coating on a copper substrate is considered as an example system. An explicit finite element analysis is carried out to study the effect of particle impingement. The results from the analysis are subsequently used in a thermo- mechanical FE model to allow the development of the residual stresses in these coatings to be analysed.