Rhodia SA's specialty chemicals subsidiary, Rhodia Polyamide Co. Ltd., marked the opening of its 269,000-square-foot nylon compounding plant before the opening of ChinaPlas 2006 in Shanghai.
Known as Rhodia (Shanghai) Engineering Plastics Co. Ltd., the plant will offer the full range of Rhodia's compounded nylons to customers in China.
The facility began offering Rhodia's Technyl Star brand in February and plans to add Technyl PA6, PA66, PA66/6, Technyl alloy and other engineering thermoplastics.
Jean Claude Steinmetz, vice president of engineering plastics SBU for Rhodia Polyamide, said the engineering plastics business unit is ``one of the cornerstones of [Rhodia SA's] profitability.''
Lyon, France-based Rhodia SA has posted losses for the past four years, and the company has undertaken a major restructuring that involves selling a number of its business units.
Steinmetz said the nylon business is not involved in the restructuring, otherwise funding would not have been approved for the plant in Shanghai or for construction of a polymerization unit in Onsan, South Korea.
He declined to reveal the investment in the Shanghai facility, but the Onsan polymerization plant represents an investment of 40 million euros ($50 million).
With an expected annual capacity of nearly 106 million pounds, the unit will start production at the end of 2007 and will supply the company's compounding facilities in Onsan and Shanghai.
The opening of the Shanghai plant marks a doubling of the company's capacity in Asia. The Onsan plant already produces 88.2 million pounds of compounded nylon per year.
Of the additional 88.2 million pounds per year provided by Shanghai, the company expects 40-45 percent to go to the automotive industry, with the remainder taken up by electrical and electronics, consumer goods, cable fibers and sporting goods.
Laurent Schmitt, president of Rhodia Polyamide, said Asia-Pacific sales already account for 18 percent of the unit's sales, or about $1.1 billion annually.
Schmitt called the 8-9 percent annual growth rate in Asia's nylon market ``very attractive.''
``There is no other region where [companies] can enjoy such growth,'' he said, adding that demand for Rhodia's engineering plastics in Asia increased 11 percent in 2005.
The two integrated facilities in Shanghai and Onsan made up ``key investment projects in 2005'' for the company, according to Steinmetz.
Schmitt said the priority for the Shanghai facility is to serve China, ``not necessarily the rest of Asia.''
Customer service also makes up one of Rhodia's strengths, said Steinmetz. As an example, he cited the company's hands-on approach in assisting Italian automotive Tier 1 supplier Magneti Morelli design and manufacture the intake manifold for the hot-selling Chery QQ.
Rhodia technical service engineers worked with mold makers to optimize mold specifications prior to production, assisting in computer-aided-design analysis.
The Shanghai plant is fitted with Coperion compounding extruders.
Rhodia competitors Lanxess AG and Bayer MaterialScience AG also will begin operating engineering plastics facilities in China this year.