InterviewBASF mulls car plastic prices, output hike

14 December 2007 03:42  [Source: ICIS news]

BASF AP Vice President Hermann Althoff mulls its new polyamide for car partsBy Florence Tan


SINGAPORE (ICIS news)--BASF, one of the largest engineering plastics makers globally, is considering more price hikes to offset rising feedstock costs and increasing Asian output to meet growing demand, a top executive said on Friday.


“We are also under intense pressure from feedstock prices. So far, engineering plastics, as a general trend, have not really mirrored this increase in raw material prices adequately,” Hermann Althoff, the Asia-Pacific group vice president for engineering plastics, said in an interview.


The German major raised polyamide prices by $200-300/tonne in November which was widely accepted by customers as costs for other engineering materials used in the automotive industry have increased at a faster rate earlier, he added.


BASF has not seen a slowdown in Asia’s demand despite high crude oil prices as sales were strong especially in Japan and South Korea, Althoff said.


The company raked in sales of €13.96bn ($9.49bn) in the third quarter and its plastics segment, including engineering plastics, contributed €3.36bn.


BASF was running several projects with Indian car producers and demand in the country was recording a double-digit growth, he added.


“Certainly, India is a market that we also pay a lot of attention to. We’re also strengthening our capabilities there,” Althoff said, but declined to comment on the company’s plans.


BASF brought on stream a new 45,000 tonne/year nylon and polybutylene terephthalate (PBT) compounding plant in Shanghai, China, earlier this year and was gradually ramping up its output.


The plant has been catering to demand from the electrical and electronics sector and automobile demand was beginning to phase in, Althoff said.


Besides increasing output, BASF has also introduced several innovations at the recent K Fair in Germany to help automotive makers reduce car weight and cut costs, he added.


Its Dolphin technology combined injection molding and foam in one step instead of the usual three, he said, adding that this would cut manufacturing costs for dashboards by 30%.


The spectacular rise in the costs of metal such as alumium, copper, brass and zinc in the past few years has also made plastics more attractive, Althoff said. For example, steel prices in Asia rose 37% between the first quarter of 2006 to the fourth quarter of 2007.


To reduce the amount of steel used in car chassis, a polyamide composite could be inserted into a metal profile and BASF has developed computer aided engineering (CAE) skills to simulate crash tests, Althoff said.


Another product, an impact-modified, mineral-filled, partially aromatic polyamide, could replace steel by being made into large car body parts such as fenders and hoods, Althoff said.


The polyamide specialty was considered a breakthrough for BASF as it allowed the car part to be painted in an assembly line and the plastic has dimensional stability - unlikely to contract or expand, he added.


“The idea is not new, but so far nobody could reach the requirement,” Althoff said.


In Asia, the company was discussing some application projects with car makers for the polyamide specialty, he added.


“If it comes to large volumes in Asia, we will produce it here too,” Althoff said.


The material could be used in cars in 2012-2013 as car innovations were usually two generations ahead as they needed many specifications and safety requirements, he said.



By: Florence Tan
+65 6780 4359

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