Covestro: Taking root in China and serving the global engineering plastics market

On July 1 this year, the organizational restructuring of Covestro took effect. Based on the guiding principle of fully embracing the corporate vision of a circular economy, the company has formed 7 business units to promote the implementation of its new "sustainable future" strategy. Among the seven divisions, the engineering plastics division is the only division of Covestro that has its global headquarters in Shanghai. Recently, Wang Li, the global president of the engineering plastics division of Covestro, was interviewed and explained the development strategy of the engineering plastics division.

　　 Based in China, close to the market

Wang Li said: “As a German company, Covestro established the global headquarters of a business unit in China ten years ago. This shows that Covestro is very optimistic about the Chinese market and attaches great importance to its layout and long-term development in the Chinese market. "China is currently the largest single market for Covestro's engineering plastics business unit, and will account for approximately 40% of Covestro's global engineering plastics share in 2020.

Currently, the entire business department management team is in Shanghai. Wang Li said: "From the perspective of upstream and downstream, most of the future growth momentum and potential of engineering plastics are in China. The upstream production capacity layout and many downstream Chinese customers have shown very strong innovation momentum. This environment The harmonious atmosphere provides good conditions for Covestro to develop engineering plastics in China. Covestro sees this trend and is committed to taking root in China. A dynamic market realizes the vision of leading the global engineering plastics industry."

Covestro recently obtained ISCC PLUS quality balance certification, a certification system that promotes the sustainable development of circular economy globally. Obtaining the certification means that Covestro has the MDI supply capability to provide downstream customers with alternative raw materials to produce high-performance polycarbonate and polyurethane in the Asia-Pacific region. She said: "The business unit will be based in Shanghai, looking at the world, based on the Chinese market, and constantly seeking development."

　　Focus on automotive innovation and R&D

Wang Li believes that automobiles are one of the main business areas of engineering plastics. The development of the automobile industry will bring many opportunities for the engineering plastics business. Covestro is closely connected with the automotive industry chain, and has very in-depth cooperation from automotive OEMs to OEMs, and has become long-term partners with many customers.

The innovative R&D of the Covestro Engineering Materials Division focuses on automobiles, which is an important connotation of the strategic development of the division. Aiming at the lightweight of automobiles, the business unit uses high-performance carbon fiber composite materials as alternative materials, which are light in weight, strong in impact resistance, and comparable to metal materials such as steel, providing a good solution for realizing automobile lightweight. Wang Li said that at present, Covestro carbon fiber composite materials are still in the early stage of research and development. With the increase in demand from downstream customers, the company can develop more targeted carbon fiber composite application solutions.

However, some downstream customers have taken a fancy to Covestro’s innovative products. Covestro, SAIC and its downstream supplier Tiancheng Automation have jointly developed a mass-produced thermoplastic carbon fiber car seat. The use of carbon fiber not only reduces the weight of the seat and reduces the energy consumption required for the use of metal, but also frees up space within the limited range of the car. According to reports, the thickness of carbon fiber seats can be reduced by 5% to 41%, and the weight can be reduced by 1 to 2 kilograms.

　　Change roles, focus on double carbon

Wang Li emphasized that the strategic reorganization helped the business unit change its role from the original raw material manufacturer to a more focused solution supplier. This role change requires the development of the business unit to shift from the original investment and expansion of mass production to focusing on R&D and innovation, from simply selling products to providing solutions and technical support for customers. By focusing on circular economy and sustainable development, the business unit helps customers increase their value and realizes the closed loop of circular economy.

She further explained that under the "dual carbon" goal, the business unit's value to customers is not only to provide customers with raw materials, but to provide them with targeted carbon reduction solutions. This is the goal that the Engineering Plastics Division will strive for next, and it is also a requirement for the implementation of the circular economy. Of course, in the initial stage, focusing on R&D and innovation will not show obvious economic and social benefits, but this is inevitable in the process of qualitative change. As R&D accumulates to a certain level, a qualitative leap will appear. By then, this transformation will not only promote the rapid development of Covestro itself, but also create more and higher value for corporate customers.

Wang Li added: “Achieving a circular economy is much more complicated than building a new PC factory, because it not only requires the integration of upstream and downstream resources, but also the implementation of the closed-loop concept of the circular economy. This is not an easy task. The goal of the business unit In the next five or ten years, we will find the right partners, use our own technological advantages, and work with them to innovate and develop to realize a circular economy."