Bayer MaterialScience sees market shift towards China

14 June 2010 15:06  [Source: ICIS news]

LEVERKUSEN, Germany (ICIS news)--China is set to become Bayer MaterialScience's largest market this year, the German major said late on Friday.

Greater China - which includes mainland China, Hong Kong, Macau and Taiwan - contributed around a third of the business' global sales growth in the first quarter (Q1) of the year compared with the same period in 2009, CEO Patrick Thomas said, speaking at a Pre-K plastics conference in Leverkusen.

Three zones dominate the firm's sales, said Thomas. The US was the largest market in Q1 2009, followed by the DACH region (Germany, Austria and Switzerland), and then by Greater China.

All three zones have clearly grown, but the geographical distribution of sales has shifted, said Thomas.

China's growth has been out of all proportion and brought our three key regions to around the same level in terms of market size, he said. "Its pretty clear if you look at the growth rates that somewhere in the middle of this year China will actually become the largest market that we serve in our business, ahead of the US and the German speaking industrialised regions," he added.

Whereas Bayer's sales in North America and Latin America/Africa/Middle East have been stable since 2009 at 20% and 13% out of overall sales respectively, Europe continued a downtrend and fell from 41% to 40% in Q1 2010. Asia, and specifically Greater China, however, saw sales climb from 26% in 2009 to 28%, he said.

"From 2004-2008 we saw only minor changes in the percentage of our sales from different parts of the world - the world was pretty much growing in harmony," said Thomas. "As we came out of the crisis in 2009, Europe had started to shrink, while Asia saw significant growth. It's almost as if the volume shock was confined to the western world."

"An interesting perspective on how the crisis has affected us is that it hasn't impacted our innovation, but it has impacted the entire geography of our business," he added.

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By: Andy Brice
+44 20 8652 3214



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