Nylon-12 Crisis Continues

  • WSJ – April 18, 2012, 5:44 p.m. ET

Search Begins for New Resin

Auto Industry Acts to Stretch Supplies, Line Up Substitutes for Scarce Nylon-12

By JEFF BENNETT

Global auto companies are moving to stretch supplies of nylon-12, a resin critical to manufacturing fuel lines and other components, as they look for longer-term solutions to a supply crunch that threatens vehicle production.

Parts makers and auto makers are collaborating on quick steps to deal with short supplies of the resin, following an explosion last month at a German chemical plant which cut worldwide output of nylon-12 in half.

Producers of vehicle parts that contain nylon-12 have already compiled a list of ways to substitute other materials now on the market in order to keep making fuel and brake lines, according to people familiar with the matter.

Earlier this month, a Michigan auto parts supplier, TI Automotive Ltd., warned of a high risk that the shortage of nylon-12 would force shutdowns at auto assembly plants within several weeks.

 

NYLON12

Agence France-Presse/Getty Images

A March chemical plant explosion in Marl, Germany, cut about half the world’s supply of an specialty resin.

At the same time, auto makers are talking to other chemical manufacturers, including DuPont Co., DD -0.24%BASF Corp., and Dow Chemical Co., DOW -0.03%about replacing nylon-12 with more readily available resins in the future, those people said.

DuPont has assembled a team to work with auto makers on increasing production of replacement materials. However, it will be up to the auto makers to determine on a case-by-case basis which materials they will use.

“This will not be a one-size fits all,” DuPont spokeswoman Carole Davies said. “We are working closely with our customers to find the alternative materials that will work in specific applications.”

Dow Chemical said it does not make or manufacture nylon-12 but it has allocated “essential resources” to find alternatives that could replace the resin. One example of a replacement is nylon 6-6, a synthetic used in carpet fibers, zip ties and hoses.

A spokeswoman for Evonik Industries AG, the German company that is the main producer of nylon-12, said on Wednesday that it is in talks with some customers to determine if a biologically-based polymer that Evonik now produces might work as a replacement for some applications of nylon-12.

On Tuesday, executives from eight auto makers including General Motors Co. GM +0.46%and Toyota Motor Co. TM +0.14%and 50 parts suppliers met in a Detroit suburb to craft a plan to deal with the potential shortage. It is one of the few times the auto industry has collaborated on a common problem. During the meeting, six committees were formed to develop, evaluate and fast track action plans to mitigate the nylon-12 shortfall. The committees are studying component and vehicle production.

Follow-up meetings have been scheduled over the next few weeks with the findings to be shared throughout the industry. TI Automotive, a maker of fluid carrying systems and other components based in Auburn Hills, Mich., was the first to notify the industry of a possible shortage earlier this month.

The nylon-12 supply crisis began last month after an explosion at an Evonik plant in Marl, Germany, that essentially cut the global output of nylon-12 in half. Nylon-12 is extensively used throughout the auto industry in the production of fuel lines, fuel tanks and brake lines since it is highly resistant to reacting with brake fluid and gasoline.

Evonik officials have said it may take more than six months before production can resume. Industry experts estimate there is less than two-month of nylon-12 supply available and any substitutes must still be tested.

“There is going to be a period of touch and go when it comes to automotive production disruptions,” IHS Automotive analyst Michael Robinet said on Wednesday.

Write to Jeff Bennett at jeff.bennett@dowjones.com

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