1 OPPORTUNITIES FOR ADVANCED TECHNOLOGY NONWOVENS IN AUTO INTERIORS AND EXTERIORS PRESENTED AT: TECHTEXTIL SYMPOSIUM NORTH AMERICA 2006 Atlanta, GA March 31, 2006 B/mydocs/papers/techtex06 PRESENTED BY: BOB ELLER ROBERT ELLER ASSOCIATES, INC. Akron, OH (USA) 330.670.9566 [email protected]
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OPPORTUNITIES FOR ADVANCED TECHNOLOGY NONWOVENS IN AUTO INTERIORS AND EXTERIORS
PRESENTED AT:TECHTEXTIL SYMPOSIUM NORTH AMERICA 2006 Atlanta, GAMarch 31, 2006B/mydocs/papers/techtex06
PRESENTED BY:BOB ELLERROBERT ELLER ASSOCIATES, INC. Akron, OH (USA)[email protected]
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PRESENTATION HIGHLIGHTS
• AUTO INDUSTRY OVERVIEW• AUTO SUPPLY CHAIN IMPLOSION/
IMPLICATIONS FOR NONWOVENS• NONWOVEN PATHS-TO-MARKET• GLOBAL NONWOVENS DIFFERENCES• COMPETITIVE MATERIALS/PROCESS
COUPLES• VALUE ADD STRATEGIES• TARGET MODULES
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SOURCES/REFERENCES
• ADVANCED TECHNOLOGY NONWOVENS MULTICLIENT: ROBERT ELLER ASSOCIATES, INC./JOHN R. STARR INC.
• AUTOMOTIVE INTERIOR SOFT TRIM MULTICLIENT: ROBERT ELLER ASSOCIATES INC.
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AUTO INTERIORFIBERS
AND TEXTILESMARKETS
COATED FABRICS
BATTING(SHODDY, FELT)
NONWOVENFACINGS
FOAMS (COMPETITION/COMPLEMENT)
NEW LIGHTWEIGHTACOUSTIC FIBERS
WOVEN/KNITTEXTILES
ARTIFICIALLEATHER
LEATHER
Opportunities for Advanced TechnologyNonwoven Fabrics for Automotive Interior
Surface and Construction Applicationsin NAFTA and Europe
• PRODUCTION GROWTH 3%/YR. THROUGH 2012• DEMAND HISTORY +/- 5% OFF TREND SINCE 1970• GLOBAL OVERCAPACITY• STAGNANT U.S./EUROPE DEMAND• DEMAND GROWTH SHIFT TO ASIA PACIFIC• MINI/SMALL CAR (B SEGMENT) SHARE GAIN• GROWTH OF DOMESTIC ASIA PACIFIC OEMs• SHARE LOSS BY U.S./EUROPEAN DOMESTIC OEMs• “HIGH” U.S. FUEL PRICES CONTINUE• NO MAJOR U.S. ENERGY POLICY SHIFT THRU 2010
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GLOBAL LIGHT VEHICLE PRODUCTION TREND LINE
• 2011 GLOBAL SALES COULD REACH 75MM UNITS
• GLOBAL AAG = 3%/YR.• ASIA PACIFIC GROWTH
7.5-8.5%/YR.?• WESTERN GROWTH
STAGNANT OR DECLINE• GLOBAL FLEET SHIFT
TOWARD SMALLER CARS• VARIATIONS HAVE BEEN
IN +/- 5% BAND SINCE 19700
10
20
30
40
50
60
70
80
90
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
SOURCE: GM, WARDS, ROBERT ELLER ASSOCIATES, INC., 2006
SALE
S, M
M V
EHI
CLE
S
ACTUAL
TREND
PLUS 5%MINUS 5%
1973 OIL CRISIS
1979 OIL CRISIS
- GULF WAR- EUROPE RECESSION
'06 GLOBAL SALES,
65MM UNITS
IRAQ INVASION
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LIGHT VEHICLE PRODUCTION SHIFT, 1997-2011
0
2
4
6
8
10
12
14
1997 2005 2011
SOURCE: ROBERT ELLER ASSOCIATES, INC., 2006
VEH
ICLE
PR
OD
UC
TIO
N, (
MM
UN
ITS) USA
JAPANRUSSIACHINAINDIA
10SOURCE: CLEAR VIEW ECONOMICS L.L.C., 2006
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0.0
0.0
0.0
0.4
4.6
1.0
1.4
0.9
0.2
0.1
0.2
0.0 2.0 4.0 6.0 8.0 10.0 12.0
VIETNAM
PHILLIPPINES
AUSTRALIA
TAIWAN
MALAYSIA
INDONESIA
THAILAND
INDIA
KOREA
CHINA
JAPAN
VEHICLE PRODUCTION, ASIA (MM UNITS)
2005
2012
7 MM NEW VEHICLES ARE EXPECTED TO COME FROM CHINA, INDIA, AND THAILAND BY 2012.
SOURCE: CSM, ROBERT ELLER ASSOCIATES,INC., 2006
PROJECTED AUTOMOBILE PRODUCTION IN ASIA: 2005-2012
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PETROCHEM PRICEINCREASES
GLOBALCOMPETITION
OFFSHORECOMPETITION
IMPORTEDCOMPETITORS
HARDBALL PURCHASINGPRESSURES
RAW MATERIALPRICE INCREASES
VEHICLE PRICEDECREASES
FUEL COSTS(PROD. LINE FIT)
LEGACY COSTS,LABOR PRESSURES
PRICECOMMODITIZATION
SHIFT TO MOREATTRACTIVE MARKETS
MATERIALSTECHNOLOGY
LAG
ELIMINATION OFEXTRA STEPS
PROCESSTECHNOLOGY
LAG
LEGACYCOSTS
RAW MATERIALS COMPOUNDER TIER 1 FABRICATOR ASSEMBLY
TIER 2, 3SUPPLIERS
MARKETSHARELOSS
OVERCAPACITY
STOCKHOLDERPRESSURES
PRESSURES PASSED DOWNTHE SUPPLY CHAIN:
PRICING PRESSURES
SUPPLY CHAIN "MANAGEMENT"
DEMAND SLOWDOWN
REVISED SPECIFICATIONS
GLOBALIZATION PRESSURES
ELIMINATE/REDUCE THE INEFFICIENCIES:-MULTIPLE STEPS-EXCESSIVE LOGISTICS-SCRAP GENERATION-INEFFICIENT PROCESS TECHNOLOGIES-SALES/MARKETING COSTS-EXCESS LABOR COSTS-OVER-GLOBALIZATION?
SOURCE: ROBERT ELLER ASSOCIATES, INC., 2006re/mydox/tpemcII/SPETPO05-implosion.vsdlg/myfiles/visio/SPETPO05-implosion.vsd
-SIMILAR (SLIGHTLY MORE ADVANCED IN EUROPE)USE OF LIGHTWEIGHT FIBER CONSTRUCTIONS
-DIFFERENT FREQUENCIES, SIMILAR PERFORMANCE REQUIREMENTS
ACOUSTIC PERFORMANCE. REQUIREMENTS
-HIGHER (65%) IN EUROPE(STARTING IN U.S.)NW CARPET SURFACE
-HIGHLY PENETRATED BY NWs IN EUROPEHEADLINER FACE FABRIC
-HIGHER IN EUROPE-INCREASE IN NAFTA DUE TO:
-“HIGH”FUEL PRICES-SLOWLY CHANGING FLEET MIX
WEIGHT REDUCTION PRESSURES
-SIGNIF. IN EUROPE/VERY MODERATE IN NAFTA-FAVORS PO MONO-MATERIAL CONSTRUCTIONS
RECYCLING PRESSURES
-DEVELOPMENT TARGET IN BOTH REGIONS-EUROPEAN “BEER CRATE” LEGISLATION -“TALL CARS” INCREASING FASTER IN NAFTA-EUROPEAN SPARE TIRE COVER DESIGNS MORE ADVANCED
TRUNK/FLOOR MODULECONSTRUCTION SHIFTS
NONWOVEN POSITIONTARGET MODULE/ KEY PARAMETER
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AUTO INDUSTRY SHIFT IMPLICATIONS
U.S. NEARS EUROPE/JAPAN TECH.
TECHNOLOGY CONVERGENCE
-REDUCE SQ M/VEHICLE-INCREASE NW USAGE
B-VEHICLE SHARE GROWTH
MICRODENIER NW PENETRATION
ACOUSTIC IMPROVEMENT REQ’D
-TECHNOLOGY CONVERGENCE-“GLOBAL” SUPPLIERS
GLOBAL VEHICLE SHARE GAINFAVORS PP NONWOVENSMONOMATLS CONSTRUCTIONSFAVORS PP NONWOVENSINCREASE PP IN INTERIORS
PANELNOTES:OMITS HYDROENTANGLED (ABOUT 6% MKT. SHARE)(A) DOMINANT METHOD(B) E.G., AcTTM (C+A), ULTRALIGHTTM (RIETER), SonoTec AT (LEAR), DUAL IMPEDANCE FIBER (PELZER)(C) HIGH END VEHICLES ONLY(D) EPP FOAMS MAY BE USED FOR HINTERSPRITZEN
SOURCE: ROBERT ELLER ASSOCIATES, INC./JOHN R. STARR, INC. AUTOMOTIVE NONWOVENS MULTICLIENT STUDY
nonwoven ptm 03.vsd
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NONWOVEN PATH-TO-MARKET OPPORTUNITY FORADDING VALUE RESIN
NONWOVENPRODUCTION
NONWOVEN
FOAMLAMINATION
NW/FOAMLAMINATE
MODULEASSEMBLY
ASSEMBLEDMODULE
OEM
PREFORM
MODULEASSEMBLY
PUFOAMRESIN
PREFORMEDSUBSTRATE SUBSTRATE
RESIN
MODULEASSEMBLY
PU RESIN?SKIVED PU SHEETPO FOAM SHEET?
NOTE: = VALUE ADD OPPORTUNITIES FOR NONWOVENS
nw op val ad 03.vsdSOURCE: ROBERT ELLER ASSOCIATES, INC./JOHN R. STARR, INC.AUTOMOTIVE NONWOVENS MULTICLIENT STUDY
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65MM UNITS / 3%/YR. GROWTH
RADICAL OEM RESTRUCTURING
AGGRESSIVE COST SAVE SEARCH
FLEET COMPOSITION SHIFT
REGIONAL VEHICLE PROD'N. SHIFT
CHINA/ASIA VEHICLE SHARE GAIN
SUPPLIER REDUCTION
ADVANCEDTECHNOLOGYNONWOVENS
AUTO DEMAND/OPPORTUNITIES ENABLERS
NEW PROCESSTECHNOLOGY
PROPERTYADVANTAGES
SYSTEMS COSTSAVINGSPOTENTIAL
MONO-MATERIALCONSTRUCTION
SOURCE: ROBERT ELLER ASSOCIATES, INC., 2006re/mydox/papers/autodemand-oppys06.vsdlg/myfiles/visio/autodemand-oppys06.vsd
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SUMMARY• PROFITABILITY PRESSURES WILL INTENSIFY• VEHICLE GROWTH WILL BE IN ASIA PACIFIC• SUPPLY CHAIN SHIFTS OFFER OPPY’S/CHALLENGES
FOR NWs • POLYOLEFIN FOAM/NW LAMINATES WILL GAIN
SHARE• ADVANCED TECHNOLOGY NWs OFFER VALUE ADD
POTENTIAL AND SYSTEMS COST SAVINGS VIA:- MONOMATERIAL CONSTRUCTIONS- ELASTIC NONWOVENS- IMPROVED ACOUSTIC PROPERTIES (ELIMINATION OF HEAVY LAYER (PARTIAL IN FLOOR SYSTEMS)
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SUMMARY (CONT’D.)• KEY TARGETS ARE
- HEADLINERS (SUBSTRATE/FACE FABRIC, NW vs. KNIT COMPETITION)-FLOOR/ACOUSTIC SYSTEMS (MICRODENIER NWs)-DOOR MODULES (PO NW/PO FOAM LAMINATE
• PO NONWOVENS PENETRATION WILL BE FACILITATED BY:- UV RESISTANCE- ABRASION RESISTANCE - ELASTIC PROPERTIES - MICRODENIER WEIGHTS/ACOUSTIC PROPERTIES - BICOMPONENT FIBERS