It's not surprising that the auto industry is taking the looming shortage of nylon 12 resin seriously. Remember, this industry has first-hand experience with what a fractured supply chain can do to OEMs and suppliers alike, following natural disasters in Japan (earthquake and tsunami) and Thailand (flooding) last year. I've been watching coverage of the nylon 12 situation -- triggered by a March 31 explosion and fire at an Evonik Industries AG plant in Marl, Germany. So far the best story came from David Vink, who wrote "Evonik warns customers about nylon 12 supply constraints," which Plastics News posted on April 15. If you want to bring yourself up to speed on cyclododecatriene feedstocks, nylon 12, competitors to Evonik, potential replacement materials, plans to rebuild the Marl factory and the supply-demand picture prior to the explosion, you should start with Vink's story. To help fill in the blanks with information since that report, here are some important additions: Paul Blanchard from IHS Chemical noted that Evonik and Arkema SA -- which buys cyclododecatriene from Evonik -- together account for about half the world's supply of nylon 12. So if it wasn't clear before, that number should drive home the point that this isn't just a problem for Evonik. Despite that, Dustin Walsh, a staff reporter for Crain's Detroit Business, noted today that automakers have not announced any planned shutdowns or cutting forecasts as a result of the anticipated shortage. Walsh wrote in his "Shifting Gears" blog: "Mike Goss, general manager of external affairs for Farmington Hills-based Toyota Motor Engineering & Manufacturing North America Inc., said in an emailed statement: 'The material provided by Evonik is in our North American supply chain, but until we complete an assessment with our suppliers, the impact is unknown. At this time, there is no need to adjust production, and we will continue to work closely with our suppliers to ensure ongoing production.'" Walsh also wrote that hundreds of auto industry executives are meeting in Troy, Mich., this afternoon to discuss the situation. Their goals:
- Help the industry understand and quantify the current state of global nylon 12 inventories and production capacities.
- Collaboratively brainstorm options to strategically extend current nylon 12 capacities and/or identify alternative materials or designs to offset projected capacity shortfalls.
- Identify/recruit the necessary industry resources required to technically vet, test and approve such options.