Shanghai — German materials company Domo Chemicals held a grand opening for its new nylon compounding plant in Jaixing, China last week.
The facility, which began operation on March 1, now has 10,000 metric tons of production capacity and plans to add 5,000 tonnes in 2017 and another 5,000 tonnes in 2019.
According to Domo Engineering Plastics Asia Managing Director Ludovic Tonnerre, the company intentionally wants to keep the plant small scale to keep transportation logistics costs low for customers in the region.
“The way we want to grow in China is we want to supply locally, and for us China is not [just] a country, it is also a continent,” he said in an interview with Plastics News. “One of the biggest challenges that people face is transportation cost, also for the environment. On purpose we made something small that can be duplicated. The key area for us is to follow our customers in their westward moves.
“We are very customer-oriented business,” he explained. “Everything we do is because of our customers. The key area for us is to follow our customers in their westward moves.”
The new plant will manufacture products including Domamid nylon 6 and 6/6, as well as high-temperature, functionalized nylon compounds for the automotive, electrical and consumer goods industries. With Econamid and Econamid Oro, the company leverages post-industrial scrap as feedstock.
Tonnerre said Domo's strategy will be stay small. “My goal is to build plants with no more than 3 lines, because if you have more lines you need more middle management.”
The next plant will be built in India, he said, then one in northern China and one in western China. “A lot of people think that big is beautiful, but I don't think so.
“We have seen a clear signal that the market demand for high value and high quality engineering plastics is increasing. For example, we have doubled our sales in the past year, and the automotive application, especially the under-the-hood applications, is driving this increase,” he added.
The new plant is located in the Jiaxing CECEP Industrial Park run by the China Energy Conservation and Environmental Protection Group, which holds high environmental standards for companies in their industrial parks around China.
“This is probably where we spent most of our time talking with the government, developing a good project,” Tonnerre said. “We are very happy with the cooperation.
“It is a fully environmentally friendly plant. It's probably the only [compounding] plant I know that uses solar panels, rainwater source water, air treatment, and we don't put water in the sewage.” Tonnerre added it was worth the effort from an economic point of view as well. “If it is a well-thought process, green can be very cheap.”
Domo has been growing fast since acquiring the Engineering Plastics business unit of Aquafil Group in mid-2013. “We have successfully moved from a commodity type of business to a specialty type business,” Tonnerre said. In January 2015, he said, the company was producing 80 tonnes a month on average of specialty business, and today the numbers has grown to 400 tonnes a month.
Domo Chemicals is privately owned with $1 billion sales, 900 employees, and facilities in Germany, Italy, China and the United States.
