CAFE and Cheap Energy Drive Auto Plastics Growth

TROY, MI – Aluminum has dominated the conversation about taking weight out of vehicles in recent years, but plastics producers also see rising fuel-efficiency standards as a means for turbocharging growth.

At the annual TPO Engineered Polyolefins conference here, 800 engineers, chemists and marketers gathered for three days to discuss technology and ideas for gaining share in new vehicles.

Several key themes emerged: Now more than ever, TPO plastics producers are aiming to compete directly with steel and aluminum in big, complex parts such as liftgates and in harsh environments under the hood; plus, they are going after almost everything in vehicle interiors.

Another eyebrow raiser: A major Chinese plastics supplier views the U.S. as the global low-cost source for manufacturing plastic resins, thanks to the shale oil-revolution.

Automakers use billions of pounds of plastic each year to make everything from bumpers to engine components and different polymers and plastic compounds battle daily for new vehicle applications in addition to trying to displace incumbent metal parts.

Each family of plastics, from ABS thermoplastics to thermoset polyurethanes, has advantages and disadvantages regarding cost, processing and recyclability. Plus, each family supports a huge ecosystem of feedstock suppliers, compounders, molders and molding-equipment suppliers capable of producing millions of car parts annually.

TPOs used to be considered cheap plastics that were difficult to paint and warped easily.“They used to call us polywarpolean,” jokes one insider.

But the relatively low cost of TPOs and their ability to be recycled easily led to processing and chemistry improvements. Those advancements enabled TPOs to replace polyurethane plastics in front and rear bumpers beginning in the late 1990s. After conquering bumpers, the material’s softness, recyclability and resistance to the sun’s ultraviolet rays then enabled it to replace vinyl and other plastics for interior parts such as instrument panels, center consoles and interior trim.

TPO interior components also can be designed to limit odors. The new-car smell Americans love is repellent to most Chinese consumers, and they now represent the world’s largest automotive market. That’s another advantage for TPOs, proponents say.

In the 1990s, polyamide nylon resins replaced metal parts under the hood such as in intake manifolds and valve covers. Now TPOs are going after nylon.

“TPOs and other polypropylene compounds are really invading other polymer areas and those areas are taking business away from metals, and that’s what we need to do,” says John Moyer, president of Asahi Kasei Plastics North America.

One of those new areas is large complex parts.

Anis Tebib, marketing manager for France-based Trinseo Automotive, gives a presentation on a TPO liftgate the supplier co-developed with Renault for the ’15 Espace CUV. The hatch is 10% lighter than a comparable steel version, offers more design freedom and lower upfront tooling costs.

Cheap Energy Lures Chinese Investment in U.S.

Low-cost gas and petroleum derived from hydraulic fracturing (fracking) and other drilling methods is driving a new wave of mergers and acquisitions, including Chinese companies looking to manufacture in the U.S. and export to overseas markets.

Shanghai PRET Composites, a leading Chinese TPO compounder, acquired Johnsonville, SC-based Wellman Plastics Recycling earlier this year. At the conference here, PRET announces a major production-capacity expansion at the U.S. business unit, now called Wellman Advanced Materials.

The 44 million-lb. expansion will enable PRET to offer TPO, long-glass reinforced polypropylene and other engineered polypropylene compounds to automakers and Tier 1 suppliers in North America. Production is expected to start by the end of 2015.

Besides expanding capacity, PRET is adding testing services and advanced computer-modeling capabilities for mold-filling and structural analysis, says Larry Berkowski, vice president-sales and marketing.

“PRET is one of the few Chinese companies to come to the U.S. and bring capital as well as technology and a manufacturing footprint,” says Wellman Advanced Materials CEO Xy Sun.

The long-term strategy is to supply interior trim on the high-volume global platforms of European OEMs, Sun says. Wellman’s location puts it close to BMW’s assembly plant in South Carolina and Mercedes-Benz in Alabama.

PRET already has global automotive approvals with BMW, Daimler, Volkswagen and Ford, Sun says. It also has a strategic partnership with Yanfeng Automotive Interiors, a Chinese company that became the world’s largest interiors supplier after it bought the interiors businesses of Johnson Controls and Visteon.

“Shale gas has really changed the footprint of manufacturing,” says Sun. “The U.S. has a very intelligent workforce and low energy costs. In that sense, we should be able to drive the next decade of TPO and polyolefins.”

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