May 26, 2017 7:37 pm JST

Teijin to go on worldwide auto composites drive

Focus is on Europe and China with electric car demand rising

YOSHIFUMI UESAKA, Nikkei staff writer

Teijin purchased CSP, a company which has many techniques for making glass fiber reinforced plastics.

TOKYO -- Japanese chemical and textile manufacturer Teijin will increase the number of its automotive composite material production and engineering bases around the world to around 30 -- 1.5 times the current number.

The initiative will span the next five years and focus mainly on Europe and China.

As electric cars gain popularity and emissions regulations become stricter, global demand for the lightweight, high-strength composites is expanding.

Teijin is looking to work more closely with its clients at the planning phase and offer technological support from the new bases.

The initial goal is to increase auto-related sales by 25% to more than 100 billion yen ($897 million) for the year ending in March 2020 from the year ended March 2017.

For its composites business, Teijin has only one base in China and two in Europe, compared with 12 in North America.

Demand for electric cars is booming in China, while in Europe there is also growing interests in replacing steel with composites. Teijin will hence concentrate most of the investment in the two regions.

The planned 30 or so bases will include production locations equipped with heat treatment equipment to harden molding tools and composites, as well as engineering locations for creating prototypes based on clients' requests and assisting them in the design process.

Teijin produces components made of glass fiber reinforced plastics, or GFRP, and the carbon fiber equivalent, CFRP. The materials are used as a substitute for steel, but they are difficult to mold and producing in large quantities can be problematic.

To promote their application, the company needs to lower the molding costs and develop mass-production-oriented designs.

Teijin has spent more than 100 billion yen on its composites business for three years through fiscal 2016.

In January, the company bought Continental Structural Plastics, a major GFRP automotive parts supplier in the U.S., for $825 million -- the highest price ever paid by Teijin.

Over the past few years, Teijin, together with General Motors, has been pressing ahead with the development of CFRP parts, many of which have been incorporated into GM models. The company will also start constructions on a new CFRP plant in the U.S.

CSP specializes in GFRP for exterior panels. The company has developed products that are 15% lighter than conventional GFRP products by using hollow glass beads.

Teijin is now set to pitch the composites and processing technology to Japanese automakers.

The company has also made significant progress in higher-yield and more efficient molding technology. Teijin has developed a number of prototypes for luxury cars with automakers in Japan, the U.S. and Europe and is moving toward practical application.

The demand for composites has the potential for a further growth. According to France-based JEC Group, the world's largest composites information provider, the demand for automotive composites in 2021 will increase by 25% from 2016 to 3.39 million tons.

Teijin is expected to further invest some tens of billions of yen in the market in the next three years.

Teijin Ltd.

Japan

Market(Ticker): TKS(3401)
Sector:
Industry:
Process Industries
Textiles
Market cap(USD): 4,048.45M
Shares: 196.95M

Get Insights on Asia In Your Inbox

To read the full story, Subscribe or Log in

Get your first month for $0.99

Redeemable only through the Subscribe button below

Once subscribed, you can…

  • Read all stories with unlimited access
  • Use our smartphone and tablet apps

To read the full story, Subscribe or Log in

3 months for $9
SUBSCRIBE TODAY

Take advantage of this limited offer.
Subscribe now to get unlimited access to all articles.

To read the full story, Update your account

Resubscribe now to continue reading.
BEST OFFER:
Only US$ 9.99 per month for a full-year subscription

To read the full story, Subscribe or Log in

Once subscribed, you can…

  • Read all stories with unlimited access
  • Use our smartphone and tablet apps

To read the full story, Subscribe or Log in

3 months for $9
SUBSCRIBE TODAY

Take advantage of this limited offer.
Subscribe now to get unlimited access to all articles.

To read the full story, Update your account

We could not renew your subscription.
You need to update your payment information.