Showa Denko K.K. (SDK) (TOKYO: 4004) has decided to terminate operation of its production lines to synthesize unsaturated polyester resin (UP) and vinyl ester resin (VE) at Isesaki Plant by the end of June 2021, and concentrate domestic production of UP and VE at Tatsuno Plant in order to improve profitability of its UP and VE businesses.
SDK’s functional polymer business has production lines at two bases in Japan, two bases in China and one base in Thailand. UP is marketed mainly as molding material for automotive parts, housing and construction materials. VE is marketed mainly as corrosion resistant material and electronic material. The demand for UP and VE is increasing in overseas markets, especially in China and ASEAN countries, due to increases in house building and infrastructure construction, and the growth of automotive industry. However, in the domestic market, the demand for UP and VE is decreasing due to a decrease in new house building, because the use as housing material is the main use for UP and VE in Japan. Therefore, SDK decided this time to concentrate its operation to produce UP and VE at Tatsuno Plant, aiming to streamline production of UP and VE in Japan. In addition, SDK decided to concentrate its marketing effort for UP and VE on market segments which are expected to be highly profitable and grow, aiming to strengthen earning power of the UP and VE businesses. In Japan, SDK will focus its marketing effort on infrastructural use. Outside Japan, SDK will focus its sales effort on promising markets including China and ASEAN. Furthermore, Isesaki Plant will commit itself to development and production of highly functional resins for electronics, whose market continues growing.
The Showa Denko Group’s Vision is to make itself a “KOSEIHA Company” (a group of KOSEIHA Businesses that can maintain profitability and stability at high levels over a long period), and the Group aims to make more than half of its businesses KOSEIHA Businesses by 2025. With regard to its functional polymer business, SDK aims to make it a KOSEIHA Business by selecting appropriate market segments and improving its profitability.
Source: Showa Denko
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