LANXESS to expand capacities for high-performance rubber in U.S.

• Additional 20,000 tons per year SSBR and Nd-PBR in Orange, Texas
• Completion of debottlenecking project for 15,000 tons per year Nd-PBR in Orange
• New five-year supply agreement with Korea’s Hankook Tire
• Meeting growing global demand for ‘green tires’

Leverkusen, Seoul, Texas - LANXESS is further expanding its capacities to produce solution styrene butadiene (SSBR) and neodymium polybutadiene (Nd-PBR) rubbers in order to meet growing global demand for high-performance, environmentally friendly ‘green tires’. An additional 20,000 metric tons per annum of the high-performance rubbers will come on stream at the company’s site in Orange, Texas, by the third quarter of 2012. The expansion represents a EUR 10 million investment.
 

At the same time, LANXESS has completed its debottlenecking project to increase production of Nd-PBR by 15,000 metric tons per annum at its site in Orange. This expansion, which was announced in March last year, is part of a investment totaling EUR 20 million to increase production of Nd-PBR by 50,000 metric tons per annum in Orange, Germany’s Dormagen and Brazil’s Cabo. The additional capacities in Germany and Brazil will be fully operational by the first quarter of 2012. Theses expansions will also lead to an indirect increase in SSBR capacities at the company’s site in Port Jérôme, France. 

“Our capacitiy expansions mirror the strong demand from our customers for innovative and premium high-performance rubber,” said Joachim Grub, Head of the Performance Butadiene Rubbers business.

Grub was speaking at a signing ceremony in Orange to mark a new supply agreement between the German specialty chemicals company and South Korea’s Hankook Tire. LANXESS will supply Hankook with SSBR and Nd-PBR from 2011 to 2015. Financial details were not disclosed.

“This new agreement will further strengthen the already successful long-term partnership between Hankook and LANXESS,” said Jeong Ho Park, Vice President of Global Purchasing for Hankook Tire.

LANXESS has been providing Hankook with high-performance rubber for the last six years. The new agreement comes into effect well before the previous contract ends on December 31, 2011. Both companies agreed on an early contract renewal in order to respond better to the increasing global demand. The world’s seventh largest tire manufacturer is currently expanding capacities at its factories in South Korea, China, Indonesia and Hungary.

Demand is being driven by the megatrend mobility as well as motorists calling for higher environmental and safety standards in performance tires. In addition, demand is being accelerated by European Union legislation. As of November 2012, new tires sold in Europe have to be labeled for fuel efficiency, wet grip and external rolling noise. 

The aim of the legislation is to reduce CO₂ and noise emissions by promoting ‘green tires’ that do not compromise on safety. In addition, the labels will provide more transparency to consumers and aid them in their purchase decisions. The tires are to be categorized in a system of classes, with the best performance for fuel efficiency and wet grip being labeled “Class A” and the poorest “Class G”. 

Japanese tire manufacturers voluntarily introduced tire labeling at the start of 2010 and the topic is also under discussion in South Korea.

LANXESS is the leader in synthetic rubber for high-performance ‘green tires’ - the fastest growing sector in the tire industry, with an annual global growth rate of about nine percent. Nd-PBR is part of a tire’s compound and reduces energy consumption more efficiently than many other tire rubbers. It also reduces tire abrasion thus playing a significant role in making cars safer as well as more ecological and economical. SSBR is used in the tread mix of a high-performance tire. It reduces rolling resistance while also improving grip on wet roads.

Both Nd-PBR and SSBR belong to LANXESS’ Performance Butadiene Rubbers (PBR) business unit. Apart from tires, performance butadiene rubbers are used for plastics modification in the manufacture of High-Impact Polystyrene (HIPS) for injection molding applications, for example. Other areas of application include golf balls, shoe soles, conveyor and drive belts. PBR is part of LANXESS’ Performance Polymers segment, which achieved total sales of EUR 3.8 billion in 2010. 

In addition to SSBR and Nd-PBR, LANXESS is a supplier of butyl rubber to Hankook Tire as part of a five-year contract that started in 2010. LANXESS’ butyl rubber is used in tire inner-liners due to its high air impermeability.

Hankook Tire (Vice Chairman & Global CEO: Seung Hwa Suh) is the seventh largest and one of the fastest growing tire manufacturers in the world. It produces innovative, superior quality and high performance radial tires for passenger cars, 4x4s, SUVs, light trucks, campers, trucks, buses and motor sports. It invests approximately five percent of its revenue in research and development and develops cutting-edge technologies through its five global R&D Centers, meeting regional customer demands and enhancing customer satisfaction. Selling in over 180 countries around the world, the company has more than 16,000 employees. Approximately 70 percent of its revenue comes from growing overseas sales. 

LANXESS is a leading specialty chemicals company with sales of EUR 7.1 billion in 2010 and currently around 14,850 employees in 24 countries. The company is represented at 45 production sites worldwide. The core business of LANXESS is the development, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.

(Source: LANXESS Press)