PolyOne Corp. is stepping up its production and sourcing efforts in China to serve an Asian market that is growing much faster than its North American and European counterparts.
The company dedicated a $10 million compounding plant June 23 in Shenzhen. The site began production at the end of May.
The 215,300-square-foot facility will be one of the company's largest, with 20 extrusion lines, 100 employees and initial production capacity of more than 23 million pounds per year. The facility will house a laboratory and technical center that will focus on developing new products for local consumption.
The site will be one of PolyOne's first to manufacture a range of products including color and additive concentrates; engineered materials; low-smoke, halogen-free wire and cable compounds; and liquid polymer coating systems. The Avon Lake, Ohio-based company designed the plant to allow for expansion up to 66 million pounds annually and may add PVC compounding later, according to President and Chief Executive Officer Tom Waltermire.
Waltermire also introduced Willie Chien as the firm's Shanghai-based general manager for Asia. Chien, who has a doctorate in chemical engineering from the University of Massachusetts, joins the compounding giant from Huntsman Chemical Co., where he was managing director, business director and corporate purchasing director for the Asia-Pacific region. He also previously served as a senior executive for a Goodyear Tire & Rubber Co. joint venture and for Ciba Specialty Chemicals.
PolyOne derives about 30 percent of its current annual China sales from the southern part of the country, in the manufacturing-intensive Pearl River Delta region, Waltermire said June 21 at Chinaplas 2005 in Guangzhou.
Until now, though, all of its production has been in the north - colors and additives in Shanghai, and engineered materials in Suzhou. That tended to add up to a week to delivery times to customers in the south.
Waltermire said the $2.2 billion company - which also runs an engineering polymers plant in Singapore and a colors and additives facility in Thailand - has seen 30-40 percent annual sales growth in China during the past few years; it's looking at double-digit growth there again this year.
PolyOne now gets about 4 percent of its total sales from Asia. Bernard Baert, international vice president, sees tremendous potential in Asia, citing projections of 11.1 percent annual growth for compounding masterbatch demand between 2003 and 2008
That increase would follow an average of 13.5 percent annual growth for those products from 1990 until 2003. The firm cited particularly strong demand for its color products in the automotive and packaging sectors in China, and for its compounds in the electrical/electronics and automotive sectors.
Waltermire said PolyOne plans to develop local suppliers on a coordinated, regionwide basis. Until now, individual plants tended to buy their own materials.