Samta May2012 Parta

7/29/2019 Samta May2012 Parta

1/34

Industry Overview and Trends

Southern Advanced Materials Research ExchangeSouthernTechnologiesCouncil

June1,2012

D.J.DeLong,DeLong

&Associates,LLCagents

forAKSACarbonFibers


2/34

TheChallengesofIndustrializingCarbon

FiberComposites

for

The

Future

MarketforCarbonFiber YesterdayandToday

Global

Megatrends

Implications

for

Carbon

Fiber

Composites

MarketforCarbonFiber ExpectedFuture?

Challenges

for

Carbon

Fiber

with

the

Expected

Future

Market

AKSA, theWorldLeaderinAcrylicFiber

AKSA

inCarbonFiber


3/34

Themarketforcarbonfiber

10

years

ago

in

2000

1stCFinAerosp

ace

CFAdopte

dinWindBlades

Bo

eing787

BMW

CityCar

1stCFSportingG

oods

1stCFinComm

ercialAirliners

CFAdopted

inElectronicsPlastics

CFAdopted

inEarthquakeRetrofitting

CFinF1Car

s

CFTrials

inOffshoreOil

Supply/Capacit

y000mt

15.000mt

lessthanUS$1B

small

(comparedto

steel,

aluminum,

glassfiber,

others)

Applications:

Aerospace

MilitaryAirctaft,

SpaceStructures,CommercialAircraftSecondaryStructures

FishingRods,GolfClubShafts

NicheIndustrialapplications

TotalValue:

HeavilyconcentratedinAerospaceapplications

Veryexpensivecomparedtootherstructuralmaterials(aerospaceCFRP>$1,000/kg;

$30premium

for

graphite

golfclubshaft=$500/kg!)

GrowthRate:

Averaged58%p.a.

Source:Aksa

Marketing.


4/34

Themarketforcarbonfiber

today

in

2010

2011

1stCFinAerospa

ce

CFAdoptedinWindBlades

BMW

CityCar

1stCFSportingGoods

1stCFinComm

ercialAirliners

CFAdoptedinElectronicsPlastics

CFAdopted

inEarthquakeRetrofitting

CFinF1Cars

CFTrials

inOffshoreOil

Supply/Capacity000mt

Applications:

Industrialapplicationsbecomingsignificant

Wind

Blade

Spars PressureVessels

Civil/Infrastructure

Compounding

SpecialtyAutoTotal Value:

Becomingaffordable

IndustrialapplicationsasmuchasAerospace

GrowthRate:

Increasedfrom2004

Interruptedin2009

40.000mt

morethanUS$1B

stillrathersmall

Boeing787

Source:Aksa

Marketing.
http://images.google.com.tr/imgres?imgurl=http://www.binaisletimi.com/wp-content/bozcaadarsi1.jpg&imgrefurl=http://www.binaisletimi.com/haberler/ruzgar-enerjisi-yatirimi-yapmak-isteyenlere/&h=293&w=468&sz=36&hl=tr&start=6&tbnid=4C_9gHoL0oC0JM:&tbnh=80&tbnw=128&prev=


5/34

Producer GrowthTraditional

CFProducers:

CytecFormosaPlasticsHexcelMitsubishiRayonSGLGroup

TohoTenax/TeijinTorayZoltek

NewCFProducers:AKSA(Turkey)Bluestar(China)CompositeHolding(Russia)Hyosung(Korea)

JiangsuHengshen(China)Kemrock(India)

Montefibre(IT)+Sabic(KSA)ZhongfuShenying(China)

Varying degrees of commercial activity


6/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites


Challenges

for

Carbon

Fiber

with

the

Expected

Future

Market


AKSA

inCarbonFiber


7/34

GlobalMegatrends

11Environmentalregulationandgovernance:

increasingfragmentationandconvergence

1 Increasingglobaldivergenceinpopulationtrends2 Livinginanurbanworld3 Diseaseburdensandtheriskofnewpandemics

4 Acceleratingtechnologicalchange:racingintotheunknown

5 Continuedeconomicgrowth?6 Fromaunipolartoamultipolarworld

7

Intensifiedglobal

competition

for

resources

Decreasingstocksofnaturalresources8Increasingconsequencesofclimatechange9

Increasingenvironmental

pollution

load

10

*SOURCE: TheEuropeanEnvironment StateandOutlook2010:AssessmentofGlobalMegatrends.EuropeanEnvironmentAgency,Copenhagen.(SOER2010)


8/34

SomeEvidenceoftheGlobalMegatrends

Source: United Nations DESA report World Population Ageing 1950-2050

Source: www.globalchange.umich.edu

Source:WorldEnergyto2050 FortyYearsofDecline Copyright2007,PaulChefurka

Source:WorldEnergyto2050 FortyYearsofDecline Copyright2007,PaulChefurka

PopulationGrowth,Urbanization,Ageing

RapidTechnologicalChange

DecliningStocksof

NaturalResources

Perhapstwothirdsofallthepeoplewhohaveeverlivedtothe

age

of

65

are

alive

today

GrayDawn,PeterPeterson


9/34

WhattheGlobalMegatrendscanmeanforCarbonFiber

*Megatrendssource: TheEuropeanEnvironment StateandOutlook2010:AssessmentofGlobalMegatrends.

European

Environment

Agency,

Copenhagen.

(SOER

2010)

1 Increasingglobaldivergenceinpopulationtrends2 Livinginanurbanworld3 Diseaseburdensandtheriskofnewpandemics

Moreelectricityreqd,morecars,smallercars,electricvehicles,betterinfrastructure

4 Acceleratingtechnologicalchange:racingintotheunknown

Fastermassadoptionofcarbonfibersolutionsafter

pioneering

5 Continuedeconomicgrowth?

6

Fromauni

polar

to

amulti

polar

world

7 Intensifiedglobalcompetitionforresources

Increaseddemandforautos,needforsustainableenergysupplies

Decreasingstocksofnaturalresources8

Increasingconsequences

of

climate

change

9

Increasingenvironmentalpollutionload10

Energyefficientvehicles,alternateenergypoweredvehicles,

clean/greenvehiclesand

transportation

11Environmentalregulation

andgovernance:increasingfragmentation

andconvergence

Cleanenergy,greenvehicles

and

products


10/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites


Challenges

for

Carbon

Fiber

with

the

Expected

Future

Market


AKSA

inCarbonFiber


11/34


12/34

SomePotentialHighVolumeUsesof

Carbon

Fiber

that

Make

SenseAircraft

WindTurbineBlades

Civil/

Infrastructure

Autos/Trucks/Buses

Carbonfiber

mustbe

available,

affordable,andreliably

supplied

Composite

solutions

mustberesponsiveto

customers

needs

Thepayoffofweightsavingsandimprovedcorrosionresistanceoverairframelifeiswelldocumented

B787,with50%ofitsairframeweightbeingcarbonfibercomposites.isjustthebeginning.

Largeblades(4560metersandlonger)areenabledwithcarbonfiberasreinforcement. Bladeweightreductioncanbesignificant,leadingtosavingselsewhereinthesystem.

Reinforcingaged

structures

can

be

less

costly

and

less

disruptivethantearingdownandrebuilding carbonfibermaterialsworkwellinmanysituations.

MeetingEuropescontinuallylowerCO2emissionslimitsorUS

increasingCAF

requirementsor

offsetting100+kgsofbatteriesallrequirelight

weighting. Carbonfibercompositesplayinmulti

materialdesign

e.g.,selectiveuseofcarbonfiber.

Withworldwideproductionexceeding90miovehiclesperyearandgrowing,potentialdemandforcarbon

fiberin

transportation

is

massive.
http://images.google.com.tr/imgres?imgurl=http://www.binaisletimi.com/wp-content/bozcaadarsi1.jpg&imgrefurl=http://www.binaisletimi.com/haberler/ruzgar-enerjisi-yatirimi-yapmak-isteyenlere/&h=293&w=468&sz=36&hl=tr&start=6&tbnid=4C_9gHoL0oC0JM:&tbnh=80&tbnw=128&prev=


13/34

MostCarbonFiber goesthroughIntermediateProcessingbeforemakingCompositeParts

Carbon

Fiber

FilamentWinding,TowPlacement

MultiaxialFabrics

WovenFabrics

Compounding

Unidirectional

Fabric

ExtrudedSections

Prepreg

Prepreg

+/20%

+/20%

+/40%

510%

+/10%

40.000tpa

Com

pound/Infra/T

ransport/Marin

e/WindBlades/PressureVessel

Forevery$/ /

ofcarbonfiber,

thereisanother$

/ /

of

weaving

/prepregging/

othermaterial

processing,

andseveral

multiplesof

that

to

fabricatethecompositepart.

Thetotalcarbon

fiber

composites

valuechaintoday,generates$510Bannually.

Source:AksaMarketing.
http://images.google.com.tr/imgres?imgurl=http://www.modbargains.com/images/Products/NRG/Carbon_Fiber_Fabric_Twill_2x2.jpg&imgrefurl=http://www.modbargains.com/product.aspx?pf_id=Carbon_Fiber_License_Plate_VW_DC&h=287&w=323&sz=45&hl=tr&start=1&usg=__x-cD53TUP616C6aZms9PMRLPXm4=&tbnid=eYgWaiRpwVOL2M:&tbnh=105&tbnw=118&prev=/images?q=twill+fabric+carbon+fiber&gbv=2&hl=tr


14/34

PotentialMarketforCarbonFiberby2020

3x

today

=

150,000mt?Aerospace:

approxx3to~30ktby2020

Expectedgrowthbasedon

knownprograms

(B787,A350,etc.)

WindBlades:

approxx10to30+ktby2020

Expectedbasedonmoreandmorelargerbladesexpectedfromallturbinemanufacturers

Automotive:

Unpredictable,butpotentiallyverylargeby2020:>50kt?

100

200

300

400

500 CarbonFiberDemand

Auto"potl"?

Auto"min"

Wind

Other

Aero

Sports

CarbonFiberMarketinTotal:x3to150kt

in10yearstime

withreasonably

high

confidence

3x

Source:AksamarketingSource:AksaMarketing.


15/34

Automotive:

2010:78miopassengercars+13mioLCVs+4mioHCVs;plusgrowthinvehicleproductionisexpectedasworldeconomiescontinuetodevelop

DonotexpectallCF

vehicles

Multimaterialdesign

expecta

fewkgsonasomemodels

Afewkgsonmanymodels?

Unpredictable,butpotentiallyverylargeby2020

E.g.,multimaterialdesignconceptfromSGLIICSParispresn03.2011

Otherexamples:

100

200

300

400

500 CarbonFiberDemand

Auto"potl"?

Auto"min"

Wind

Other

Aero

Sports

PotentialCarbonFiberMarketinTotal?:x6x10to300500kt

in1015yearstime?

(asyetveryuncertain)

610x??

?

?

Source:Aksamarketing

AutomotivecandriveCarbonFiberdemand

by

2020

to

6

10x

today

=

300

500,000mt?



16/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites


Challenges

for

Carbon

Fiber

with

the

Expected

Future

Market


AKSA

inCarbonFiber


17/34

Industry Overview and Trends

Southern Advanced Materials Research ExchangeSouthernTechnologiesCouncil

June1,2012

D.J.DeLong,DeLong&Associates,LLCagentsforAKSACarbonFibers


18/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites


Challenges

for

Carbon

Fiber

with

the

Expected

Future

Market


AKSA

inCarbonFiber


19/34

Thecarbonfiber/compositematerials/

compositepartsfabricationvaluechainis

anindustrygenerating$810Bin

turnover,

andintenyearstimecouldbethreeor

moretimeslarger.

Howwillthiscomeabout?

Duringmostofthe1970s,1980s,1990s,

andearly2000s,andagainduring2008

2010,carbonfiberproducerswerenot

profitable.

Withoutahistoryofprofitability,willthe

industryinvestonitsowntogrowas

needed?

Isnew

thinking

required?

ValueoftheCarbonFiberCompositesIndustry

Composites

Materials

CarbonFiber

Today c.2020

$810B

$2530B+

Whatwillittakeforthisrelativelysmall

industry

to

become

a

big

industry?

Thecarbon

0

1

10

100

1,000

VolumeofIndustries

000mt

In$value:Steel>1,000xlargerAlum

>50x

larger

Fiberglass>50xlarger



CarbonFiberComposites/Components asmallindustryshouldbecomeabigindustry?


20/34

HowMuchNeedsToBeInvested

To

Grow

The

Industry?

Polymerizationand

Precursor

Carbonization($20k40k*/mtofcapacity)

Materials

Processing

(weaving,prepregging,etc.)

CFRPPartFabrication(preforming,autoclavecure,RTM,towplacement,molding,etc.)

Total

Source:*variousproducersannouncementsand?Aksamarketingestimates.

$13B?

$36B?

$12B?

$14B?

__________

_______$615B? ($1550B?)

Howmuchmustbeinvestedtogrowtheindustryby100kt? Togrowitby300400kt

Whowillinvest

thetens

of

billions

ofdollarsrequired

todevelopthis

industrytoits

potential?

Incumbents?

Newentrants?

Risksharing

partners?

Newapproaches?

Note that global wind turbine sales alone in 2010 were $42.3BSource: PRNEwswire Nov. 7, 2011


21/34

PotentialRoleofCooperation?

Noteverything

will

come

from

organic

growth!

WhyCooperate? WhyStrategicAlliances?Aimforsynergythatthebenefitsfromallyingaregreaterthanindividualefforts

FormsofCooperation:

Mergers&Acquisitions(combiningofdifferentcompanies;consolidation)StrategicAlliances(joiningofforcestoachieveacommonobjective;partiesmaintaintheirindependence)

TypesofStrategicAlliances:

Joint

Venture

(e.g.,

a

new

independent

company)EquityStrategicAlliance(e.g.,combinesomeresources)NonEquityStrategicAlliance(e.g.,contractualrelationship)

PotentialAdvantages:

ConcentrateonactivitiesthatmatchcapabilitiesShareorgainknowledgeandexpertiseDevelopnewcompetenciesAchievecommonobjectivesShareexpenses shareriskGuaranteesupplyorofftake(demand)


22/34

RiskSharingExamples

Supply AgreementsBoeing / Toray long term supply agreement for B787Airbus / Hexcel long term supply agreement for A350

Joint Development ProgramsDaimler / Toray development program, 2010GM / Teijin development programFord / DOW development program

MRC / Fiberforge, 2009

Joint VenturesBMW / SGL JV driven by i3 automotive vision

Daimler / Toray JV Parts Plant, 2011

Equity PositionsMRC / Dynetek equity share for CNG tanks (c.2000)


23/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites


ChallengesforCarbonFiberwiththeExpectedFutureMarket


AKSA

inCarbonFiber


24/34

AKSAAkrilikKimyaSanayiiA../AKKKGroup

AKKK Group companies:

AKKK 2007 2008 2009 2010

Sales US$ 1.393 1.634 2.166 2.675

Employes 3.080 4.016 4.229

(Combined Sales in million US dollars)

AkkokGroup

39%

PublicHeld(IMKB)

42%

EmniyetAS

19%

AKSAShareholding

CHEMICALSAKSA

(39%),AKSAEGYPT,AKKM,AKMELTEM

ENERGYAKENERJ

TEXTILES

AKAL,

AK

TOPS,

AKSU

(AKSU

was

the

first

company,

foundedin1952toproducefabrics)

REALESTATEDEVELOPMENTAKMERKEZ,AKTURZM,AK

OTHERSERVICESAKPA,DNKAL,AKPORT,AKTEK,AKMERKEZ

LOKANTACILIK

AKKK Group holds 39% of AKSAs shares

AKSAAkrilikKimyaSanayiiA.S.

establishedin1968

19681978licensefromChatillion(Monsanto)wetspinningprocess

AKSAprocessdevelopedsince1978

publiclytraded(AKSA:IST) US$851miosalesin2010 910employees Sellinginternationallysince1977to

morethan50countries


25/34

WorldLeaderinAcrylicFiberProduction

45Producers

of

Acrylic

Fiber

AKSAis#1:

LeaderinQuality

LeaderinProductsOffered

LeaderinContinuousImprovementLeaderinManufacturingTechnology

AFutureLeaderinCarbonFiber

Capacity

mt

Products

Mfg

Technology

Producer

Country

inthelast10years,severalsmallscaleoperationshaveshut,including:SterlingUSA,AsahiJapan,SasolS.Africa,SolutiaUSA(Monsanto),Acordis UK(Courtaulds),Cydsa Mexico

AksasproductionsiteinYalovaTurkey



26/34

0

100,000

200,000

300,000

AKSAsCapacityDevelopment:

19725.000mt

Today308.000mt

LargestScaleFiberProductionintheWorld

wetspinning

acrylicfibermanufacturing Aksasproductionsite

inYalova


27/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites




AKSA

inCarbonFiber


28/34

MarketResearch:

Carbonfiberhasbeencommerciallyavailablesincethe1970s

Existingproducershaveallbeeninthegameformostofthistime.

Demandisgrowingasnewapplicationsarecommercialized.

Tightsupply

conditions

occurred

every

few

years,

during

which

timesaerospacecustomersseemtohavebeenmostpreferred.

Thereappearstobeanunmetneed inthemarketfor

highquality,reliablysupplied,competitivelypricedcarbonfiber.

AKSAsDecisionin20052006

AKSAsview/Decision:

Withtheworldslargestplantproducingacrylicfiberproductionunderoneroof,

with40+yearsofknowhow,owntechnologyandexperienceinacrylicfiberandspecialtytechnicalfibers,

withtheresourcesandabilitytodevelopPANprecursorandcarbonizationtechnologyinhouse,

withtheresourcestofacilitizetoproducePANprecursorandcarbonfiber,

AKSAdecidedtodevelopPANprecursorandenterthecarbonfiberbusiness.


29/34

AksasStartupinCarbonFiber20082009

2008:

Startupof

Carbon

FiberPilotProductionCarbonizationLineandCarbonFiber

Precursor

PolymerizationandSpinningLines

2009:Startupof1.500mt

CarbonFiberProductionCarbonizationLine

Thiswasabigdecisionthatrequiredplanning,

commitmentandpatience

Aksas632.000m2ProductionSitein

YalovaTurkey(arrowindicates

carbonfiber

productionbuildings)


30/34

AksasCarbonFiberExpansion20102012

2010:1.500mtproductionrateachievedonCarbonFiberProductionCarbonizationLinelessthan1yearfromstartup

2011:

1.800mtproductionrateachievedonCarbonFiberProductionCarbonizationLine

Dec

17

th

2010

Announcement:1)Debottleneck1st

CarbonFiberProductionCarbonizationLine2)Buildnew2nd

CarbonFiberProductionCarbonizationLine

3)AdditionalPrecursorCapacity4)TotalCarbonFiberCapacity

tobe

3.500

mt

by

2Q

2012


31/34

AksasPositioningForTheFuture

AksasYalovaproductionsiteistheworldslargest,mostefficient,fortheproductionofacrylicfiber(>300,000mtp.a.)

Potentialtoproducehundredsofthousandsoftonnesof highqualitycarbonfiberprecursor(100,000200,000mtp.a.)

Demonstratedknowhowandcapabilitytoefficientlyproducesmalltow(andlargetow)carbonfiber

Aksaisuniquelypositionedtosupplylargequantitiesofaffordable,highqualitycarbonfiberreliablytothefutureverylargemarketforcarbonfiber


32/34

Dow+AksaCarbonFiberJointVenture

Partneringrespectivestrengthstoachieveacommongoal

Signed

definitive

agreement

Dec.

20,

2011

Intheannouncement: CarbonFiber Derivatives

(CompositeMatls)

BroadRangeofProducts IntegratedSolutions Megatrends WindEnergy Transportation

Infrastructure ReliableSupply Affordability BetterSolutions Global

TheDowChemicalCompany

DowcombinesthepowerofscienceandtechnologywiththeHuman

Element

to

passionately

innovatewhatisessentialtohumanprogress.

TheCompanysdiversifiedindustry

leadingportfoliodeliversabroadrangeoftechnologybasedproductsandsolutionstocustomersinapprox160countries.

In2010,Dowhadannualsalesof$53.7billionand

employedapproximately

50,000peopleworldwide.

TheCompanysmorethan5,000productsaremanufacturedat188sitesin35countries

acrossthe

globe.


33/34


FiberComposites

for

The

Future

Conclusions:

1.

Global

megatrends,

including

population

development

and

shifts

in

resources,offertheopportunityforthecarbonfibercomposites

industryto

increasetoseveraltimesitscurrentsize

2.

Themarketforcarbonfiberisshiftingfromitshistoricalaerospacepremium

product

orientation

to

larger

scale

industrial

applications

and

production

processeswhereaffordabilityandreliablesupplywillberequired

3.

Thefuturemarketisopen,sonewentrants,newarrangementsand

new

approaches

are

all

likely,

and

might

result

in

shifts

in

industry

leadership

4.

Significantinvestmentisrequiredtodeliverthefuturemarket,

andrisk

sharingthroughstrategicalliancesandpartnershipsshouldbeexpected


34/34


FiberComposites

for

The

Future


Global

Megatrends

Implications

for

Carbon

Fiber

Composites




AKSA

inCarbonFiber

Questions?

Documents

Samta May2012 Parta