Growing concerns about energy savings and gas mileage are helping push Santoprene-brand resin into the automotive weather seal market.
``Crude oil is making headlines for the wrong reasons,'' said Simon Holmes, global marketing manager for specialty elastomers including Santoprene for ExxonMobil Chemical Co. ``In this type of environment, re-evaluating the cost structure of your products can pay dividends.''
That environment already has helped Santoprene a thermoplastic vulcanizate enter into weather seals on numerous vehicles made by Honda Motor Co. Ltd. and Toyota Motor Corp., including Toyota's luxury Lexus brand, according to Bonny Bennyhoff, a market development specialist with Houston-based ExxonMobil Chemical.
Both Holmes and Bennyhoff spoke at a recent customer event held at ExxonMobil Chemical's Akron facility.
General Motors also is using 11 different grades of TPV on a window surround on its high-end Buick Lucerne vehicle.
``Every pound of plastic used on a vehicle creates 2 or 3 pounds in weight savings,'' Bennyhoff said. ``TPVs also have improved processability and energy savings vs. thermoset rubber, and they can bond to metal and other substrates.''
Bennyhoff added that using TPVs in glass-run channel applications reduces cycle times and lowers energy costs, while allowing manufacturers the ability to reduce or eliminate post-trim operations. These advantages create cost reductions of 20 percent vs. rubber, she said.
In short air ducts, using TPV in an injection molding process offers weight savings of 45-55 percent vs. using rubber in a blow molding application. Most of the weight savings is achieved through thinner walls. Walls can be made thinner while maintaining the part's overall dimensions, Bennyhoff said.
TPVs also are making their presence felt elsewhere in the auto field in belt line seals, window frames, mirror mounting brackets, corner connectors, connector seals and end caps.
The reality of high-priced crude oil and natural gas also is changing the rules of the game both for makers and users of Santoprene and other specialty elastomers.
``Raw materials are 70 percent of polymer costs in specialty elastomers,'' Holmes said. ``But higher fuel and energy costs also affect transportation, utilities and working capital.''
ExxonMobil Chemical is keenly aware of these conditions. Its parent firm ExxonMobil Corp. of Irving, Texas operates 3 percent of the world's crude oil capacity and seven percent of global refining capacity.
In transportation alone, global customers have been affected by ships sailing at slower speeds in order to conserve fuel. A four-week shipment time from Asia now is 5 ½ weeks in some cases. As a result, Holmes said, placing production in North America has benefits, because of the region's reliable supply chain.
To save energy, ExxonMobil now is running some of its extrusion equipment at night in some parts of the world because of lower energy costs. The firm also is minimizing the number of shutdowns on its lines, because of the energy needed to restart.
Polymers have remained competitive in this environment, allowing ExxonMobil to continue with its plans to open a massive specialty elastomer complex in Singapore in 2011. The plant will have the capacity to produce almost 700 million pounds of Vistamaxx-brand ethylene elastomer, Exact-brand plastomers and Vistalon-brand EPDM. ExxonMobil Chemical also added Santoprene capacity in Pensacola, Fla., in late 2006.
Raw material buyers also have to be careful about the length of contracts they enter into. Holmes cited the example of a plastic film producer that was selling to Wal-Mart in Asia and was put out of business by a 12-month contract. The firm was unable to raise its own prices as resin prices climbed 55-60 percent.
``The company had a fixed price and no protection,'' Holmes said. ``That's gambling with your business.''
ExxonMobil Chemical also is working harder to reduce its scrap rates and control its inventory. In North America, the firm has reduced the number of smaller, regional warehouses that it uses because of high inventory costs.
The unit also has had to cope with the reality of passing on its own raw material costs to its customers.
``Raising selling prices is time-consuming and disruptive, but sometimes it's necessary,'' Holmes said.