Investment in Solutions & Specialties business
Groundbreaking for new TPU Production Site of Covestro in China
- Groundbreaking of company’s largest future TPU site in Zhuhai, China
- Strengthening the production network for high-performance TPU to meet rising global demand
- Utilizing advanced production technologies and run entirely with renewable power
Covestro broke ground on its new Thermoplastic Polyurethanes (TPU) production site in Zhuhai, China. The investment had been announced in February. The new site will be built in three phases and is expected to achieve up to a maximum annual production capacity of 120,000 tons of TPU after the final phase of expansion. The mechanical completion of the first phase is estimated for 2025. This will lead to a production capacity of about 30,000 tons per year. The initial investment for this first phase lies in the mid double-digit million Euro range. The final phase is expected to be completed in 2033.
TPU is a versatile plastic material used in a variety of applications such as sports shoes, IT devices such as sweepers, smart speakers, phone cases, automotive applications like paint protection film or for the protection of wind turbine blades.
"We are excited to announce that the construction on our new TPU site commences. It shows our commitment to strengthen our production network for our Solutions & Specialties business entities overall and for the TPU business in particular,” said Dr. Andrea Maier-Richter, Head of TPU at Covestro. “It reinforces our position as one of the leading global suppliers of TPU and puts us right where important value chains are."
Once completed, the site will span across 45,000 square meters. With its potential maximum capacity of up to 120,000 tons it will then also be Covestro’s largest TPU site worldwide.
"We are committed to working closely with our customers and partners," said Lisa Ketelsen, Head of TPU in APAC at Covestro. “As Guangdong province is a major hub for the IT, consumer electronics, footwear and other industries, we believe that locating our production in close proximity enables us to collaborate optimally. To underline that, an innovation center will be part of the next phase of our investment, enabling our researchers to design customized material formulas and do formula adjustments to meet customer demands within very short cycles.”
The new TPU site will enable Covestro to provide high-performance yet sustainable solutions to its customers faster and more flexibly. At the new site in Zhuhai, Covestro shall to that end eventually offer products with the label “CQ”. Products labelled as such consist of at least 25 percent alternative, non-fossil raw materials. The site will also utilize the most advanced production technologies and be run on 100 percent renewable power.
“Together with recent investments in new plants for Elastomers, Polyurethane Dispersions and a production line for the mechanical recycling of polycarbonates in our site on the outskirts of Shanghai, this new site for TPU in southern China shall capture the robust growth of the core industries served by our Solutions & Specialties business entities in China, the region and worldwide,” said Holly Lei, President of Covestro in China.
Offering sustainable and ever more circular solutions are among the long-term core targets for Covestro overall and for the new TPU site. The company for that purpose in general works on broadening the raw material base for its products, using ever less crude oil and its derivatives. It works on using recycled materials and can also already offer core materials with attributed alternative raw materials (such as biomass) via the mass balancing approach. Besides using less fossil-based raw materials, the company also want to use clean energy sources to run its plants and manufacturing processes and aims at becoming operationally climate neutral by 2035. By the end of 2023, it expects to already cover 16 to 18 percent of its energy demand from renewable sources.
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 18 billion in fiscal 2022. At the end of 2022, the company had 50 production sites worldwide and employed approximately 18,000 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.