Large investment in Solutions & Specialties business
Covestro to build its largest TPU site in China
- New site to be built in Zhuhai, South China, with an annual capacity of 120,000 tons of TPU per year after final phase of expansion
- Expansion to happen in three phases: First phase to be completed in late 2025, final phase to be completed in 2033
- Total investment expected to be in the low three-digit million Euro range
- Own innovation team on-site to rapidly develop and adjust products with customers
Covestro will build its largest Thermoplastic Polyurethanes (TPU) site in Zhuhai, China. With an overall investment in the low three-digit million Euro range it will also be the company’s largest investment in its TPU business. TPU are a highly versatile plastic material, a real multi-talent that offers a broad range of properties for a diverse set of applications like sports shoe soles, IT devices such as sweepers, smart speakers and phonecases or automotive applications.
“This investment shows our ongoing commitment to growth in our Solutions & Specialties business entities”, said Covestro CCO Sucheta Govil. “With this new plant for TPU we want to capture the expected fast and high market growth of the TPU market globally, and especially in Asia and China. The production site will be able to serve both the growing Asian markets, as well as demand in Europe and North America.”
Located in the Zhuhai Gaolan Port Economic Development Zone in Guangdong province, the new site will eventually span across 45,000 square meters. It shall be completed by 2033 and is expected to achieve a production capacity of nearly 120,000 tons of TPU per year. It will be built in three phases. The mechanical completion of the first phase is estimated for the end of 2025. This will lead to a production capacity of about 30,000 tons per year and the creation of about 80 new jobs. The initial investment for this phase lies in the mid double-digit million Euro range.
“I’m delighted to share this important news for our Business Entity. This new plant will enable us to be in close proximity to our customers and the value chains in the IT, consumer electronics, footwear and other industries”, said Dr. Andrea Maier-Richter, Head of TPU at Covestro. “The majority of the TPU market and its growth prospects are in Asia and particularly in China. Our investment there shows our clear intention: We want to remain successful with our customers and partners in the long run.”
An innovation center will also be part of the investment, enabling researchers on-site to design customized material formulas and to do formula adjustment to meet customer demands within very short cycles. Sustainable and ever more circular solutions are among the long-term core target for these efforts. This shall also support broadening the offerings under the recently introduced, sustainable “CQ” product line. Products labelled as such consist of at least 25% alternative, non-fossil raw materials. The site will furthermore utilize the most advanced production technologies and be run on 100% green power. It will produce injection molding grades for footwear and a wide range of IT devices, as well as extrusion grades for cables, hoses and tubes or automotive applications.
Covestro is one of the world’s leading manufacturers of high-quality polymer materials and their components. With its innovative products, processes and methods, the company helps enhance sustainability and the quality of life in many areas. Covestro supplies customers around the world in key industries such as mobility, building and living, as well as the electrical and electronics sector. In addition, polymers from Covestro are also used in sectors such as sports and leisure, cosmetics and health, as well as in the chemical industry itself.
The company is committed to becoming fully circular and is striving to become climate neutral by 2035 (scope 1 and 2). Covestro generated sales of EUR 15.9 billion in fiscal 2021. At the end of 2021, the company had 50 production sites worldwide and employed approximately 17,900 people (calculated as full-time equivalents).
This news release may contain forward-looking statements based on current assumptions and forecasts made by Covestro AG. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. These factors include those discussed in Covestro’s public reports which are available at www.covestro.com. The company assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.