NPRA ’11: Japan woes loom over auto supply chain - US Solutia

28 March 2011 00:52  [Source: ICIS news]

SAN ANTONIO, Texas (ICIS)--Automobile producers are still trying to determine how vulnerable their supply chains are to disruptions among Japanese parts makers after that country's natural disaster, a  vice president for Solutia said on Sunday.

Automobile safety glass makes up a little more than half of the demand for Solutia's polyvinyl butyral (PVB) film, said Eric Nichols, vice president, business management for Solutia's advanced interlayers division.

Nichols was speaking on the sidelines of the International Petrochemical Conference (IPC).

"The biggest uncertainty now is Japan and how much of an effect it will have on global production," he said.

Automobile makers are still trying to trace their supply chains, he said.

If a key part is unavailable, producers may suspend operations.

General Motors (GM), for example, had stopped production at a plant in Shreveport, Louisiana, because of a shortage of Japanese parts.

For some parts, however, inventories could be large enough to last through the interruptions, Nichols said.

Even if automobile production is suspended, buyers could wait out the outage until their models return to sales floors, Nichols said.

Until the disasters in Japan, the automobile industry had been recovering from the recession, with US sales increasing consistently for several months.

Demand in China, meanwhile, had been increasing by high single-digit percentages, Nichols said.

Meanwhile, automobile makers are continuing to adopt acoustic safety glass, which allows them to use less glass while deadening outside noise, Nichols said.

By using less glass, automobile makers can lower the weight of their vehicles, improving fuel efficiency.

"The acoustic trend continues to be strong," Nichols said.

Hosted by the National Petrochemical & Refiners Association (NPRA), the IPC continues through Tuesday.

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Al Greenwood
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