By on April 18, 2012

Evonik Industries told Reuters that it will take at least three months for its damaged chemical plant in Marl, Germany, to resume normal production of CDT, and that full production of CDT may not return until the beginning of next winter.

CDT is a base ingredient for the production of  nylon resin PA-12. That resin is used as a coating on fuel and braking systems on most passenger cars worldwide. Evonik is the world’s leading maker of cyclododecatriene.

According to Automobile Magazine, the tight supply of Cyclododecatriene  had been known for several years. Evonik was planning on adding capacity in Asia, but that factory won’t be ready until the end of 2014.

With several weeks of supply in the pipeline to U.S. and Asian makers, “disruptions will likely start in Europe,” said Rod Lache, an analyst for Deutsche Bank AG. Once stockpiles are used up, shortages are estimated to last about six to nine months.

Evonik is not the only manufacturer of CDT as some commenters noted, but is the world’s biggest. DuPont currently supplies Fiat with fuel lines made from its own specialty polymers that do not contain CDT. Evonik told Reuters that it is looking into alternative materials that can be used as a resin without CDT.

However, suppliers and especially materials cannot be switched at will. Neil De Koker, president of the Original Equipment Suppliers Association told Bloomberg:

“Brake lines and fuel lines are safety products, so you don’t make changes overnight. You have to do them very carefully with the right testing to prove out the product.”

Testing and certification of safety products such as fuel and brake lines can take many months. This is a process the industry does not want to rush. When Renesas, a supplier of chips for on-board electronics, had a fab wiped out by the tsunami, automakers found themselves in a similar situation. Renesas is not the only chipmaker. Chips can be changed. However re-engineering and re-certification of systems would have taken longer than simply waiting for the fab to resume production.

 

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4 Comments on “Maker Of Strategic Material May Be Down For Months, Shortages To Last Longer...”


  • avatar
    alluster

    If disruptions do start and stuff hits the fan, guess who is sitting pretty with a 90 day supply of vehicles? GM

  • avatar
    PenguinBoy

    “Chips can be changed. However re-engineering and re-certification of systems would have taken longer than simply waiting for the fab to resume production.”

    The time to qualify a second source is *before* the plant blows up, not after. I understand vendor partnership, but I’m surprised more companies don’t seem to qualify second sources eliminate single points of failure in their supply chains.

  • avatar
    Dynasty

    Most major chemicals including industrial, fertilizers, pharmaceutical, vitamins, etc, are generally only manufactured in two or three major factories.

    That being said, cant fuel and brake lines be switched over to steel relatively easily?

    • 0 avatar
      Athos Nobile

      No, as Bertel said those are safety parts. Just to have a change approved requires going through bureaucratic hell.

      Brake lines, save for the flexible sections, are steel AFAIK.


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