Asahi Kasei breaks ground on Alabama compounding plant

Asahi Kasei Plastics North America will be able to solve two problems at once with a new compounding plant in Athens, Ala.

“It's a combination of us needing more capacity and of improving logistics,” Asahi Kasei President John Moyer said in a recent phone interview. “We'll be closer to our customers and will be able to save a lot of money on transporting raw materials and finished products.”

Fowlerville, Mich.-based Asahi Kasei broke ground for the new plant on Sept. 29. The plant will have annual capacity of almost 70 million pounds and will make compounds based on polypropylene, nylon 6/6 and similar materials, primarily for the automotive market. Asahi Kasei is spending more than $30 million on the new site, which is expected to open in early 2016.

The 100,000-square-foot plant will operate two production lines and will employ 35 at first, with that number growing to 100 when the site is at full capacity.

Athens is a city of about 23,000 located halfway between Birmingham, Ala., and Nashville, Tenn. Moyer described the location as being “in the heart of the southeast auto market,” close to plants operated by automakers Toyota, Volkswagen and Nissan, as well as numerous auto parts suppliers.

Asahi Kasei generates about 75 percent of its sales from the auto market, and its 200 million pound-capacity plant in Fowlerville was approaching full capacity. More capacity was needed, Moyer said, especially with North American auto builds expected to approach 17 million this year. Increased use of lightweight plastics in auto parts also is expected to continue.

“Automobiles are still very important in North America,” he explained. “The U.S. has 60 million miles of paved roads, but not a lot of public transportation. And many of us still lead lives that are dependent on having our own transportation.”

The industry also continues to benefit from car owners who held off on buying new cars during the recession, Moyer added. The age of vehicles on the road still is relatively high.

The 60-acre Athens site was chosen from a list of about 100 properties that Asahi Kasei was considering for the plant. Moyer said the area's rail and highway access, as well as its work force, influenced the firm's decision.

“The community has been very good to deal with,” he said. “We felt comfortable here.”

As part of the project, the city of Athens, Limestone County and the Alabama Department of Economic and Community affairs will provide $1.1 million to upgrade rail spur infrastructure at the 51-acre Elm Industrial park, where the Asahi Kasei plant will be located.

Asahi Kasei is a unit of Tokyo-based Asahi Kasei Corp. and ranks as one of North America's 30 largest compounders and concentrate makers.