Composites Market Report 2012

Market developments, trends, challenges and opportunities

The European GRP market - Dr. Elmar Witten (AVK) The global CRP market - Bernhard Jahn / Doris Karl (CCeV)

October 2012

8 October 2012

Page 1/29

Contents
The European ...................................................................................................................... 3 GRP Market .......................................................................................................................... 3 The European GRP market in 2012 .................................................................................... 4 Market observations ........................................................................................................... 5 GRP production in 2012: Overall development ................................................................. 5 Trends in the development of procedures/components................................................... 7 Application industries at a glance...................................................................................... 9 GRP production in 2012: itemised by country .................................................................10 Outlook ...............................................................................................................................14 The global CRP market 2012 .............................................................................................15 General ................................................................................................................................16 The global carbon fibre market .........................................................................................16 The global carbon composites market .............................................................................19 Carbon composites: Market data and developments in 2011 .........................................19 Trends and outlook ............................................................................................................23 Final observations..............................................................................................................27

8 October 2012

Page 2/29

Dr. Elmar Witten

The European GRP Market

The Author

Dr. Elmar Witten is Managing Director of the AVK - Industrievereinigung Verstrkte Kunststoffe e.V. (Federation of Reinforced Plastics). The AVK, as the German professional association for fibre composite plastics/composites, represents the interests of producers and processors of reinforced plastics/composites on a national and a European level. Its services include organisation of task forces, seminars and conferences as well as providing market relevant information (www.avk-tv.de). The AVK is one of the four national pillars of the GKV Gesamtverband Kunststoffverarbeitende Industrie and an international member of the European composites confederation EuCIA the European Composites Industry Association.

8 October 2012

Page 3/29

Dr. Elmar Witten

The European GRP market in 2012

Growth only in a few market segments

As in past years, the development of the market for glass fibre reinforced plastics (GRP) mirrors the general economic growth of the countries included in this report quite closely. This is hardly surprising when we consider the application industries to which GRP parts are supplied. The majority of customers come from a very wide range of sectors, which in total account for a considerable proportion of the industrial production of the respective economies (e.g. automotive, construction).

It is important for the future that companies in the market for fibre reinforced plastics and composites ask themselves a number of questions. How can the potential of this relatively young sector of the plastics industry (compared to other materials) can be publicised and developed even more effectively? How can production and demand in the sector be developed faster than the overall economy? The currently hot topics of series production, substitution of other materials, innovation and precisely targeted combinations of materials continue to offer enormous opportunities for this branch of industry.

Total European GRP production generally fell slightly compared to last year. To evaluate this development in detail, as in previous years, it is essential to take a closer look at the individual manufacturing processes, countries and applications. There is no other way of clearly describing the development of this extremely heterogeneous market. As a specialist segment of the plastics industry, the GRP industry essentially tracked the general development of the plastics processing industry as it has done in previous years.

8 October 2012

Page 4/29

Dr. Elmar Witten

Market observations
A survey conducted by the AVK - the German composites association - once again gathered information about GRP production volumes in Europe in 2012. To make it possible to compare this information with data from previous years, "Europe" as represented here again only includes those countries whose production data was explicitly available to the raw materials suppliers surveyed. In addition, this year's figures for the first time include Turkey, which is becoming an ever more important player in the European composites industry, as well as data from other countries from SouthEastern Europe and Western Asia that have not previously been taken into account. In the following, the term GRP includes all materials with a thermoset matrix as well as glass mat reinforced thermoplastics (GMT) and long fibre reinforced thermoplastics (LFT). Short fibre reinforced thermoplastics are not included here. Carbon fibre reinforced plastics (CRP), which are also composite materials, are dealt with separately in the second section of this market report. The market for additional reinforcing fibres (e.g. natural fibres) will not be considered here. Generally, approx. 95% of fibre composites are still manufactured from GRP, i.e. the most commonly used reinforcing fibres are glass fibres (short and long fibres, rovings, fabrics).

GRP production in 2012: Overall development

Compared to 2011, the production volume of GRP in Europe will fall by approx. 4% to 1.01 million tonnes in 2012 (s. Fig. 1). The recently positive trend back towards the level achieved before the economic and financial crisis has therefore once again stopped or slowed, at least for now. Considering the current interest of the trade press and general business press in the future of fibre reinforced plastics and composites - especially over recent months this may come as something of a surprise. The media hype surrounding the use of carbon fibre reinforced plastics (CRP) in high volume automobile production would suggest a rosy future for all concerned.

8 October 2012

Page 5/29

Dr. Elmar Witten

However, a realistic view of the current possibilities is slowly gaining the upper hand even in media reports. There are still a substantial number of challenges to be mastered in this area: due to its small market share, even above average growth of CRP would only have a relatively small effect on the total volume of composite production in the medium term. The question of whether CRP will become a widely used material in high volume automobile production is still an open one and the answer currently still depends on many factors. Public interest and debate about the subject is certainly helpful in generating a highly dynamic market and a discussion of the topic of composite materials in general is also advantageous. It contributes to raising awareness of these relatively young materials and spreading the knowledge of the various potential areas of application among executives in the relevant branches of industry.

SMC BMC SMC/BMC Hand lay-up Spray-up Open mould RTM Sheets Pultrusion Continuous processing Filament winding Centrifugal casting Pipes and Tanks GMT/LFT Others Sum:

2012* kT 188 70 258 145 90 235 120 78 47 125 80 67 147 108 17 1,010

2011 kT 198 69 267 160 98 258 120 77 51 128 86 69 155 105 16 1,049

2010 kT 198 69 267 160 92 252 113 72 47 119 82 66 148 100 16 1,015

2009 kT 160 56 216 123 74 197 94 56 39 95 69 55 124 75 14 815

2008 kT 210 70 280 202 103 305 106 69 46 115 79 62 141 95 16 1,058

Fig. 1: GRP production volumes in Europe itemised by procedures/components (kT = kilotonnes, 2012* = estimate)

8 October 2012

Page 6/29

Dr. Elmar Witten

Trends in the development of procedures/components

Falling demand in vehicle production throughout Europe is also reflected in the trend for thermoset SMC (sheet moulding compound) parts. The relatively stronger growth noted last year in automobile applications is now once again switching in favour of the electro/electronics (E & E) sector, which is currently growing at least slightly in European countries. This is one reason why BMC (bulk moulding compound) production, which is primarily used in this sector, is growing slightly while SMC components have experienced a fall of around 5%. With a history stretching back over 50 years, the importance of the industrial production of SMC and BMC in the composites sector should, however, not be underestimated: after all, production in this sector accounts for nearly one quarter of the total European GRP market. It is also worth mentioning that these products are often those, which are ready for series or similar scale production. Mass production of composite parts, the subject of so much discussion, therefore already exists.

As was the case last year, demand for parts produced using so-called "open processes" (hand lay-up, spray-up) has generally continued to develop less well than other markets. After stagnating last year, these manual processes suffered the greatest relative fall (9%) of any sector in the GRP market in 2012. This particularly affects the many small companies that make individual or small numbers of parts with very little automation. As a result, the expansion of offshore wind farms, for example, is currently only making slow progress primarily due to reasons of economic feasibility, financing and technological problems. Production of the wind turbine rotor blades, still predominantly made from GRP, continues to be outsourced to other countries. The material properties demanded by ever larger rotor blades also mean that GRP is in some cases being substituted by CRP, for which this is the primary application. The maritime sector, in which the use of open processes is widespread, is also currently suffering steep falls in demand in Southern European countries.

8 October 2012

Page 7/29

Dr. Elmar Witten

Another factor at work here is that the industrialisation and automation of GRP production continues to advance. This may also lead to further reductions in demand for open processes.

The market for RTM (resin transfer moulding) and parts manufactured using this process has fared comparatively well this year with zero growth. Substitution of open processes and increased use in automobile production promise a bright future with strong growth potential. Moreover, improvements and adaptations of the processes subsumed under this category are the focus of a large number of research projects to develop improved, faster production cycles, incl. in high volume automobile production.

Continuous processes for manufacturing GRP panels are one of the few areas to have grown a little over the past year: a few major processing companies produce large volumes very efficiently here with a relatively high degree of automation. The market for GRP pultrusion profiles, in contrast, experienced a fall of 8% with production volumes continuing to be relatively low. One reason for this is the significant idle capacity in the construction sector in many European countries. Construction and infrastructure are among the main areas of application for these products along with isolated applications in the maritime and sport & leisure sectors.

There is also a clear decline in the manufacture of pipe and tank components using the centrifugal casting and filament winding processes. Not even strong business in the area of sewer renovation using so-called pipe liners can compensate for the lack of major infrastructure projects especially in Southern Europe. The production of pipes is still lagging far behind the trend in other regions of the world (especially South-Eastern Europe and Western Asia).

8 October 2012

Page 8/29

Dr. Elmar Witten

With growth of 6%, glass mat reinforced thermoplastics (GMT) and long fibre reinforced thermoplastics (LFT) are the only processes with a non-thermoset matrix considered in this report to be clearly ahead of the trend in 2012. Obviously the sector has been able to open up new areas of application and substitute alternative materials despite falling demand in the automobile industry throughout Europe.

Application industries at a glance

Fig. 2 provides an overview of the proportions of GRP parts used by individual application industries. These have remained relatively constant over time. The transport and construction sectors each consume one third of total production volume. Other sales markets include the electro/electronics sector (E & E) and the sport & leisure segment.

Alongside parts for automobile and commercial vehicle construction, the transport sector also comprises components for railway vehicles, boat building and aviation. In the construction sector, important applications include pipes and infrastructure projects as well as industrial plant construction and the production of rotor blades for wind turbines. The sport & leisure sector is the only GRP segment in which products are primarily manufactured for the consumer market. This business-to-consumer market offers considerable potential for the development of new products due to the high acceptance of other composites and even GRP among consumers.

8 October 2012

Page 9/29

Dr. Elmar Witten

15%

2% 34%

35%

14%

Transport Construction Others

Electro / Electronics Sport & Leisure

Fig. 2: GRP production in Europe for different application industries (year: 2012)

GRP production in 2012: itemised by country

The development of the GRP markets in the various individual European countries (see Fig. 3) depends heavily on a number of factors, such as the major application industries operating in those countries and their respective general economic conditions.

Continued falling car sales expected in Spain, Italy and France will exacerbate the weakness in these traditional fortresses of the automobile sector and have a direct impact on GRP subcontractor companies. The latest forecasts suggest the market will only reach its nadir in 2013 with the lowest car sales in Western Europe.

This downward trend contrasts with global growth, which is benefiting particularly from a catch-up effect in America and Asia as well as the BRIC countries. Strong exporting countries (such as Germany) and highly diversified, international companies,

8 October 2012

Page 10/29

Dr. Elmar Witten

or those that can respond rapidly to market developments and changing conditions, have the greatest chances of survival and expansion.

Recession and falling domestic demand in countries such as Spain, impact on every sector of the economy - not just on those mentioned above. The automobile industry is affected but so are the construction and E & E sectors, which are also relevant to GRP production.

In 2012, the strongest growth in GRP production in Europe appears to be in Germany, the United Kingdom and the Eastern European countries considered in this report. In Germany, the positive trend in the production of GRP parts mirrors the stronger development of its overall economy in comparison to other European countries.

The serious decline in Scandinavian countries is primarily attributable to problems in the important boat building sector and wind turbine rotor blade industry. For example, in Finland the transport sector (incl. boat building) consumes almost two thirds and the construction sector around one quarter of GRP production. Over half of these components are manufactured using open processes.

Outsourcing of production to India (e.g. for SMC parts) or purchasing components manufactured in China (e.g. for wind turbine rotor blades) is affecting all European countries. Double digit growth rates are predicted for both countries over the coming years.

The development of the world economy, including Europe's falling share of global value creation in the medium- and long-term, will also leave its mark on GRP production. Currently, Europe as a region (incl. countries not considered in this report) accounts for around one quarter of total global production of all composites (incl. all reinforcing fibres and thermoplastic materials). The remainder is essentially distributed between North America and Asia, with the latter having the larger share.

8 October 2012

Page 11/29

Dr. Elmar Witten

European countries will have opportunities to thrive if they can exploit their own specific strengths and gain advantages through innovation, quality and highly trained employees. It is to be expected that the production of standard products with a minimum standard of quality that can be achieved quickly by all suppliers and competition primarily through price (= commoditisation) will continue to be relocated to nonEuropean locations.

For the first time, this report also considers Turkey, Saudi Arabia, Egypt and Iran. According to information provided by the Turkish Composites Association (TCMA), this market has now reached a size of nearly 200 kT. It is therefore larger than any other European market considered here and is enjoying above average growth - with Turkish production expected to expand by approx. 15 kT in 2012. The main areas of application and primary manufacturing methods, however, differ significantly from those in other European countries: nearly three quarters of the total volume is used in the construction sector and of that again nearly three quarters in the construction of pipes and tanks. Transport is the second largest sector with one quarter of products being manufactured for marine applications. Consequently, the centrifugal casting and filament winding processes account for almost one half and hand lay-up and RTM processes for approx. one third of production. The applications in Saudi Arabia, Egypt and Iran and Middle Eastern countries in general are similar. The construction of waste water treatment facilities and sewers, water tanks, offshore oil and gas facilities and other completely different construction applications (e.g. sanitation, roofs, masts, footpaths and plant construction) offer potential for the future.

Integrated production technology is becoming an absolute must for high wage European countries and material and energy efficiency are assuming ever greater importance. The interaction between business and research - and also investment in academic science - is a key factor in the success and innovative power of the GRP industry. New developments offer great potential for gaining a competitive advantage, e.g. in lightweight construction solutions and particularly in the area of multi-material systems (e.g. composites and metals). Many European countries (especially Germany)

8 October 2012

Page 12/29

Dr. Elmar Witten

and companies are well-placed international leaders in the above areas with good chances of defending their positions in the global market. 2012* kT UK / Ireland Belgium / Netherlands / Luxembourg Finland / Norway / Sweden / Denmark Spain / Portugal Italy France Germany Austria / Switzerland Eastern Europe** Sum: Turkey*** Saudi Arabia**** 250 Egypt**** 60 Iran**** 75
Fig. 3: GRP production volumes in Europe - and selected Middle Eastern countries - broken down by country / group of countries (kT = kilotonnes / 2012* = estimated / Eastern Europe** = Poland, Czech Republic, Hungary, Romania, Serbia, Croatia, Macedonia, Latvia, Lithuania, Slovakia and Slovenia / Turkey*** = Source: TCMA, approx. 10% (short fibre reinforced plastics) has been deducted from the total composites volume of 200 kT in 2011 to aid comparison with the other countries / Saudi Arabia, Egypt, Iran**** = Source: TCMA)

2011 kT 126 42 52 200 165 122 172 17 153 1,049 180

2010 kT 130 40 50 217 154 116 161 16 131 1,015

2009 kT 106 31 52 188 122 87 118 13 98 815

2008 kT 123 38 69 236 183 115 145 13 136 1,058

134 43 44 160 152 117 182 17 161 1,010 195

8 October 2012

Page 13/29

Dr. Elmar Witten

Outlook
Overall, the composites market is highly dynamic, especially in the area of GRP manufacturing, which is dominated by small and medium sized companies. These companies are seeking out new areas of application for their products, diversifying their ranges and even the smallest companies are increasingly internationalising both the purchasing and sales sides of their businesses. The winners of the future will firstly be those companies, which manage to gain an advantage in the production of commodity goods through continued industrialisation of processes and secondly those that open up new applications (including combinations with other materials) or serve niche markets. If the potential of automation can be tapped (not just for commodities), the volume of composite production as a whole will enjoy even higher rates of growth than in recent years. On the marketing side, an analysis of the sustainability of various materials could reveal many advantages for composites compared to "traditional" materials. A consideration of the ecological, economic and social effects of production over the complete life cycle of the product suggests that the ecological advantages of GRP may well be the driving force that leads to the substitution of other materials. It is clear that companies are currently using every opportunity to exchange information and experience with other participants in the market, and even in other sectors, as well as giving their employees the best possible training. Advantages in training and expertise will be critical factors in the success of innovative and competitive composite materials and these must be improved together with every company along the value chain!

8 October 2012

Page 14/29

Dr. Elmar Witten

The global CRP market 2012

The Authors Bernhard Jahn is a project architect with Carbon Composites e.V. (CCeV). Doris Karl is responsible for public relations at CCeV. Carbon Composites e.V. (CCeV) is an association of companies and research institutes in Germany, Austria and Switzerland for the entire value-added chain of high performance fibre composite materials. It plays an important role in networking scientific research and businesses. CCeV sees its role as a network of competence to promote the application of fibre composites with a focus on "marketable high performance fibre composite structures. The emphasis is on fibre composite structures with plastic matrix materials, familiar to the wider public in many applications, as well as on fibre composite structures with ceramic matrices, which have higher resistance to temperature and wear.

8 October 2012

Page 15/29

General
For the first time, last year's CCeV market report considered the carbon fibre (CF) market. The section was welcomed by readers and will therefore become a fixture in the CRP market report. This part of the market report draws on information and figures supplied by CCeV members global CF production.
[SGLG]; [TohoT]; [Toray]

, which together represent over 50% of

The global carbon fibre market

The CCeV had access to additional sources of information for the production of the Market Report 2012 and is therefore able to refine last year's data and offer even greater precision. According to the revised figures, demand for carbon fibre in 2010 (33,000 t) was already slightly higher than it was before the financial and economic crisis. In 2011, demand totalled 37,000 t and therefore slightly exceeded the forecasts made in 2010. This positive trend has encouraged even more optimistic forecasts for 2012 and subsequent years than was the case at the beginning of 2011. Demand for 2012 is now estimated at around 42,000 t and even higher for 2014 at approx. 73,000 t [MTP], [SGLG], [TEJL], [TohoT].

Fig. 1: Global demand for carbon fibre in tonnes 2008-2020 (*estimates)

8 October 2012

Seite 16/29

Bernhard Jahn/Doris Karl

These highly optimistic forecasts reflect the declared intent of a number of companies to expand their production capacity:

Toray plans to increase its CF capacity at all three of its locations by one-third (approx. 6,000 t) by the end of 2015.[KunststoffWeb GmbH, Bad Homburg] The Moscow Holding "Kompozit" and state atomic energy group RosAtom want to build and operate a plant in the special economic zone of Alabuga near Yelabuga with a capacity of 1,500 tonnes p.a. by the end of 2013. [plasticker]

Taekwang Industrial Co Ltd (Ulsan/South Korea) started CF production in March 2012. A total of 100 million have been invested in the project to make the country less dependent on CF imports.[KunststoffWeb GmbH, Bad Homburg]

Hyosung aims to put its first commercial CF production plant into operation (small tow <48k / 2000 tonnes p.a.) in the city of Jeonju/South Korea at the beginning of 2013.[Hyosung]

Kemrock Industries and Exports Ltd. in Vadodara/India, Gujarat, opened a CF plant with an annual production capacity of 400 t in 2011. [Kemrock/Press Release] Zoltek Corp. is investing a further US$ 15 million in setting up a research facility in St. Peters Missouri / USA.[AreaDevelopment] Hohhot Haoyuan Carbon Fiber Co. Ltd (Inner Mongolia / China) plans to invest around US$ 2 billion in the production of carbon fibre. No information regarding capacity or planned production start-up is yet known.[KI - Branchen-Ticker im KunststoffWeb]

8 October 2012

Seite 17/29

Bernhard Jahn/Doris Karl

Fig. 2: Carbon fibre capacities itemised by manufacturer (2011) in t

according to information provided by [MTP],[SGLG],[TohoT],[TEJL]

In 2011, theoretical total global capacity was around 90,000 t of carbon fibre. The USA has the greatest installed CF capacity with around 29% of world production. Europe and Japan together account for approx. 50% and China approx. 8% of global output. Analysts predict that Chinese production will expand considerably over the coming years.

Fig. 3: CF capacity by region (2011) [MTP]

8 October 2012

Seite 18/29

Bernhard Jahn/Doris Karl

The global carbon composites market

As the vast majority of carbon fibre produced (over 98%) is processed into composite materials of all types, the carbon composite market develops at the same pace as the CF market. The tonnage of CRP is naturally much higher, however, due to the addition of the matrix component.

Carbon composites: Market data and developments in 2011

95% of the CF used in composite materials is processed into carbon fibre reinforced plastic (CRP). The rest is used in composites with matrices based on carbon, ceramic or metal. These materials are used in special applications, such as aircraft or vehicle brake discs.

Fig. 4: Global demand for CRP in tonnes 2008-2020 (*estimates)

A variety of different production processes are used in the manufacture of CRP materials/components. These are required for processing the various semi-finished fibre products. Prepregs continue to dominate in the production of CRP parts. Around 54% of the carbon fibre produced world-wide is used for manufacturing prepregs, of which 42% are based on unidirectional fabrics and 12% on woven fabrics. 5% of carbon fibre is used to make semi-finished products such as fabrics, braids etc., which are in

8 October 2012

Seite 19/29

Bernhard Jahn/Doris Karl

turn used to make CRP parts via an infiltration process (e.g. RTM). The winding (approx. 15%) and pultrusion (approx. 8%) processes are also important techniques in CRP production. Here the fibres are used in the form of yarns.

Fig. 5: Market shares of the manufacturing processes / Semifinished products for CRP (2011) [MTP]

18% of the carbon fibre used globally for CRP in 2011 was in the form of short cut (approx. of the quantity) or milled fibre (approx. of the quantity). 92% of the total short cut and milled fibre was used to manufacture reinforced plastic compounds. The remaining 8% was shared between applications in sheet moulding compound (SMC), paper, the construction industry and the generation of conductivity in a variety of products (e.g. heated car seats).

8 October 2012

Seite 20/29

Bernhard Jahn/Doris Karl

Fig. 6: Use of short cut and milled fibre by application (2011)

[MTP]

The majority of CF reinforced compounds are used in electronic devices such as laptops, printers, office equipment etc. The principal application of milled fibre (approx. 90%) is in plastic compounds used in manufacturing chip carriers.

Fig. 7: Compound consumption by application (2011) [MTP]

The most important use (23%) of CRP is in rotor blades for wind turbines. 77% of the carbon fibre used here is as UD prepreg, 20% as pultrusion material and approx. 3% as fabric.

8 October 2012

Seite 21/29

Bernhard Jahn/Doris Karl

In the aerospace sector (16%), aircraft construction dominates with approx. 11% of CRP consumption, of which approx. 8% is used in civil aviation. The use of CRP materials in space applications accounts for 1% and thus plays only a minor role. The remaining 4% in this sector are used in special applications such as engines, tools etc. In the area of sport and leisure (also 16%), CRP is primarily used in golf clubs and tennis racquets, bicycles and fishing rods (12%). The remaining 4% are used in products such as boats and sticks/bats/clubs for other sports (such as hockey).

Fig. 8: Global CRP consumption by application (2011)

[MTP]

The construction industry accounted for 9% of CRP demand in 2011. However, its use in this sector is forecasted to grow 132% by 2020. [MTP] In 2011, 44% of the CRP consumed in the construction sector was used for reinforcing concrete. 37% was used in the restoration of bridges and tunnels, 10% in new buildings and 9% in other construction works. In the construction industry, 58% of the CRP used was consumed as reinforcing fabric, 22% as pultrusion material (struts and strips), 19% as UD prepregs (UD tape) and 1% as short cut fibre.

8 October 2012

Seite 22/29

Bernhard Jahn/Doris Karl

Currently, the use of CRP in automobile construction is relatively low at 6%. However, with BMW's entry into the market (Megacity Vehicle) and the advances made in series production of CRP parts, growth rates are much higher here than in other sectors. In the area of pressure tanks (total of 6%), 3% of CRP is used for compressed natural gas (CNG) tanks. These are mostly used in automobiles. The remaining 3% is used in other pressurised storage vessels.

Trends and outlook

Analysts see the CRP as solid and above all a market with high growth potential. The consensus is for growth of at least 13% annually. This growth is due to a number of factors: In 2011, the order books of the aviation industry returned almost to the levels they achieved before the economic crisis of 2008. Orders for new aircraft are forecast to grow significantly over the next 20 years. Between 2011 and 2030, Airbus anticipates a market volume of 27,800 [MTP/Airbus-GMF] and Boeing 33,500 new aircraft [MTP/Boeing-CMO]. In the civil aviation sector, passenger numbers are expected to grow by 5.1% per year. If this continues until 2030, the fleets of the world's airlines will more than double in size. Single aisle aircraft, such as the A320-Neo or Boeing 737-Max, would account for 70% of the fleet. [MTP/Boeing-CMO] However, the proportion of CRP used in these aircraft is much smaller than in the new Boeing 786 and Airbus A340 wide-body aircraft. In the aviation industry, the major influence on the CRP market is currently through market developments in the wide-body aircraft of the Airbus A350 family and Boeing's 787 range. Based on analyst estimates, it is anticipated that approx. 9,000 t of carbon fibre will be used in wide-body aircraft in 2020. [MTP]

8 October 2012

Seite 23/29

Bernhard Jahn/Doris Karl

Fig. 9: CF consumption in wide-body aircraft [MTP]

(* estimates)

The automobile industry is seen as one of the most important drivers for the CRP market. Taking consumption of approx. 2,000 t of CRP in 2010 as their base, conservative analysts are forecasting annual growth of 15% for the sector. However, from 2013, this could be much higher depending on the success of the electric vehicles scheduled for launch. Lightweight construction is not only paramount in the electric vehicle sector. It applies equally to vehicles with conventional combustion engines. From 2015, European vehicle manufacturers must reduce the average CO2 emissions of their fleets to under 95g/km. Fines averaging 4,000 per vehicle are being discussed for transgressions of this limit. [Vogel Busines Media]. Lightweight construction is one of the ways that manufacturers can achieve compliance with legally-binding environmental standards. Even if only a few percent of each vehicle were manufactured from CRP, automobile construction would consume approx. 75% of carbon fibre production (given the right conditions) by 2030. However, this would require a dramatic reduction in the manufacturing costs of CRP components. The cost of CRP used in vehicles is currently approx. 70 /kg. This contrasts starkly with 3 /kg for steel, approx. 6 /kg for high strength steel and 7 /kg for aluminium.

8 October 2012

Seite 24/29

Bernhard Jahn/Doris Karl

Fig. 10: CF consumption in automobile construction (not incl. CNG tanks) [MTP]
(* estimates)

In the area of transport and traffic, constantly rising energy costs over recent years have led to a significant number of users switching to lower cost fuels such as natural gas. Since 2000, the market for vehicles running on natural gas has grown rapidly. Around 11.4 million of the approx. 880 million vehicles on the world's roads are now powered by natural gas. Annual growth of around 30% is forecast over the next ten years.

Fig. 11: CNG vehicles / annual new registrations [MTP]

8 October 2012

Seite 25/29

Bernhard Jahn/Doris Karl

In vehicles, the gas is stored at high pressure in special pressure tanks. Until now, most of these have been made from steel. However, these substantially increase the weight of the vehicle and therefore also fuel consumption and CO2 emissions per kilometre, which need to be reduced. Further increases in energy prices as well as projects such as "power-to-gas (converting electricity from renewable sources into hydrogen or methane), in which research institutes, industry and OEMs are working together closely, mean that CNG (compressed natural gas) pressure tanks made from CRP will play an important role in the CRP market. In 2011, approx. 1,540 t of carbon fibre were processed in this area; by 2020 this figure is expected to rise to approx. 7,480 t.[MTP] This forecast does not take into account current power-to-gas projects. If only a fraction of these projects should prove successful, it is quite possible that the assumed quantity of carbon fibre used in this sector could double.

Fig. 12: CF demand for CNG pressure tanks [MTP]

(* estimates)

The wind turbine blade market, currently the most important volume market for CRP, grew by around 23% in 2011. By 2015, annual carbon fibre demand in the wind turbine industry is expected to be approx. 22,700 t and in 2020 around 54,270 t.[MTP]

8 October 2012

Seite 26/29

Bernhard Jahn/Doris Karl

Ever larger wind turbines (up to 10 MW) and correspondingly longer rotor blades (up to 100m) will play their part in achieving this growth forecast. According to a study by the European Wind Energy Association (EWEA), wind energy capacity will triple in

the 27 countries of the EU by 2020 - when approx. 581 TWh will be fed into the European power grids compared with today's 182 TWh. By 2030, this figure is anticipated to rise to 1154 TWh. Analysts expect stable growth in demand for short cut and milled carbon fibre of around 7 to 8% over the coming years so that a total of approx. 14,000 to 16,000 t could be required by 2020.[MTP] In the past, this market segment has also often been served by small bobbin or yarn material, depending on the application, that has not met the manufacturer's specifications. When yarn has been in short supply, it has often been impossible to find enough material for this market. In some cases, this has led to dissatisfaction among processors. The significant expansion of capacity discussed at the beginning of this market report should go some way towards relieving this situation. In the future, recycled materials increasingly provided by the upand-coming recycling industry (e.g. CFK Valley Recycling GmbH-Deutschland, ELG Carbon Fibre Ltd/UK, etc.) could also be used more widely.

Final observations
In 2011, the global composites market was valued at 72 billion. Assuming an annual growth rate of around 6%, the market volume is estimated to reach 91 billion by 2015. A growth rate of 13%[JEC], or 17%[McKinsey] is expected for the CRP market, which represents only a small part of the composites market. There has long been a consensus in society that there must be a greater focus on conservation of resources and raw materials. Energy use is one of the key considerations here. The potential of high performance fibre composites in lightweight construction will make an important contribution to increasing energy efficiency and certainly offers many opportunities whether in generating, consuming or storing energy.

8 October 2012

Seite 27/29

Bernhard Jahn/Doris Karl

The durability and long life of CRP and its ability to be combined with traditional lightweight materials will open the way to additional fields of application. In the area of lightweight construction, the search is on for intelligent methods of combining and integrating steel and CRP. This could lead to ecologically and economically viable material combinations.

Urban mobility that conserves resources is one of the megatrends of the coming years.[Vortrag Hoster, CCeV Automotive Forum 2012] Lightweight construction will be paramount for most means of transport. Weight savings contribute to both increasing efficiency and reducing costs. Here, too, the outstanding potential of CRP becomes immediately apparent when it is weighed against all other materials. Optimally designed parts that efficiently exploit the properties of CRP can be 70% lighter than steel and 30% lighter than aluminium. [CCeV],[SGLG] However, tangible ecological and economic benefits can only be achieved if lightweight construction is used on a large scale. Mass production of CRP parts and the associated automation of manufacturing processes are essential if this goal is to be achieved. This, above all, is the key to the large scale use of CRP components in the automobile industry. CRP with thermoplastic matrix components will probably play an important role in this process. Partnerships/joint ventures between well-known automobile manufacturers (Audi, BMW, Daimler, Toyota and VW) and the CF industry show that there is now both a recognition of the necessity to investigate the opportunities of CRP materials in detail and the will to do so. [MTP] Price-performance ratios will decide which materials and combinations of materials will be adopted in the various applications. In the future, the ecological rather than the economic aspects should be the decisive factor. Objective life cycle analyses (LCAs) for the various classes and combinations of materials and their consistent use therefore present a further challenge for the future.

8 October 2012

Seite 28/29

Bernhard Jahn/Doris Karl

Literature [MTP] [SGLG] [TEJL] [TohoT] Materials Technology Publications: The Carbon Fiber Industry worldwide 2011-2020 SGL Group - Carbon Fibers & Composites-Ascent to Industrial Engineering Materials - Bayern Innovativ 05.05.2011 Teijin Limited: Flash Report FY09 - Financial Performance &FY10 Outlook - May 10, 2010 TohoTenax Europe GmbH: Kohlenstofffaserverstrkte Thermoplaste fr Strukturbauteile in der Luftfahrtindustrie (Carbon fibre reinforced thermoplastics for structural components in the aviation industry) - thermocomp, 06.2011 Toray International Europe GmbH: KunststoffWeb Druckdatum: 27.03.2012 08:45:36 (Ref: 1047273518)

[Toray]

8 October 2012

Seite 29/29

Bernhard Jahn/Doris Karl