Upholding technology and environmental-protection beliefs

New material, New design

Gasgoo: First of all, thank you very much to accept the interview from gasgoo.com

Eric: Thank you for inviting me today.

Gasgoo: We want to invite you to briefly introduce the services and products of GE Plastics' Automotive Division.

Eric: Ok. First of all, GE Plastics is a manufacturing of resins, and plastic materials, that's raw material that auto people use to make very nice products like car parts, but also mobile phones, computers, it's used in a wide variety of markets, The automotive division focuses purely on the automotive market. Where we work very closely with our customers to basically give them solutions: material solutions to the problems they face, like light weight solutions, like materials that can help them meet safety requirements, materials that are environmentally progressive, to give them good solutions to the harsh requirements that are out there.

Gasgoo: Ok, thanks you. Can you also introduce what's the advantage when the users, especially the Chinese people, put the plastics on automobiles?

Eric:  Sure, I think one of the key advantages of plastic material is that it gives weight out for as traditional materials like glass and steel. Typically, our materials can give up a weight reduction of 30% to 50%. If you would see, our partners will be showcasing two special vehicles at the Shanghai auto show. One of them is the GM Chevrolet Volt vehicle, the other one will be the Hyundai Carmac, the "Advanced Technology Demonstration Vehicle". On those cars, for example, we have taken out 60-90 kilograms of weight for as traditional materials like glass and steel. A second very important thing is a huge drive in the industry to go to more environmentally green products because the auto makers are looking what impacts they have on the environment. We have the materials that don't contain any hazardous substances. We have materials that can be recycled. Those are very important items. Then safety, there is also a huge drive to increase safety as well as for occupants, people inside of a car, pedestrians who walk the street and who are impacted by traffic accidents. Globally there is a huge drive to implement legislation, and we have solutions, so combination of material and design solution, to help meet those requirements globally and also in China. And then design, I think we're all car buyers, you, me, one day will buy a car, and the car should look nice, and I think the opportunities we can give with plastic materials to give it much nicer shapes, and design freedom for designers, colors, shapes. That's  enabled by plastic materials.

Gasgoo: Ok. Generally speaking, for GE Plastics, how much percentage of plastic application in the vehicle now?

Eric: I think for GE plastics, automotive is a very important segment, and we have more than 20% of our revenue all generated from automotive.

Gasgoo: Ok, then how is it in the China market?

Eric: In the China market, automotive is also a very important market segment for us. I think revenues are slightly lower than the number I mentioned before, and it is the market we have been predominately very much in electronics, but it is very fastly catching up, and getting close to the global average.

Be closer to customers

Gasgoo: Ok. Considering the automotive supply chain, for GE parts, you served as a Tier-1 supplier in direct contact with the OEMs, like Hyundai, or you just, like the Tier-2 suppliers, contact with the Tier-1 suppliers?

Eric:  I think in this case I need to explain a little bit better, because actually our products are grand new, right? We have plastic raw materials that sometimes we supply directly to the OEM, sometimes we supply to Tier-1, sometimes we supply to Tier-2. So actually from the supply chain perspective, we work with OEM, with Tier-1 as well as with Tier-2. Our activities might be slightly different depending on who we are working with. So, we're very close with the molders, the Tier-2 or the Tier-3, to give them support on how to mould the products, how to work with our materials to make sure they get the optimum effect of using our materials. With the OEMs on the other side, we're very much looking at future vehicles, what are the trends, what kind of material solutions are you looking for, and in that case more involvement in development factors, and coming up with new material solutions and new products. Also with some of the Tiers we are working with in the same way, we serve them all with the production side, but also on the development side. And this is also something which makes us different from a lot of other people: we look at materials the way you process materials, and how you design as one unit, and we spent a lot of time, effort and money to make sure that we can give best solutions to our customers, so we invest in understanding processing and supporting our customers, we invest in design and engineering and helping our customers. Even that we don't make parts, but we want to make sure that the customers who make the parts are really very successfully with what they do.

Gasgoo: So you always put the customers' requirements as the first priority.

Eric:  Customer priority is number one.

Gasgoo: Yeah, that's right. What's the difference between contacting with the OEMs and contacting with the Tier-1 suppliers?

Eric:  It depends a little bit on the specific situation. What you see in the industry that sometimes the design and engineering is done by the OEMs, sometimes for example instrument panel, can be designed by the OEM, sometimes can also be designed by Tier. It just depends the OEM you are working with, so that's different depending on the parts. Also our activities depend on what the Tier or OEM does.

Brigth future of Plastic material application on automobile   

Gasgoo: We know that in current China market, most of the suppliers attach much importance on metals, glasses, and those traditional materials, and so can you give us some little tips on the future trend of the materials in cars?

Eric: First of all, please go and visit the show this week, you will see those two vehicles I mentioned before, the GM Chevrolet Volt, as well as the Hyundai Carmac, where you will see a 60 up to 90 kilograms of the plastic materials used on those vehicles. So I'm even excluding the foam and the rubber elements on that one. I strongly believe that it will come in the future. I think we just have some way to go to help the Chinese industry, but the industry globally, to understand the benefits of the material, how it works to bring light weight, how can you improve the safety, how can you improve the performance, and how can you make sure that you meet the requirements that we as a society have, environmentally progressive solutions.

Gasgoo: Can you give us little detailed programs in future strategies in China market?

Eric: I think one of the things, for example, one is safety, we have for example finished the program to get with the Chongqing Chang'an Suzuki for energy absorber that is a part of the front of the car, which basically help absorb the energy and give less damage to the car, as well as people in the traffic accident. And you'll also see in the road here in China, the first cars with plastic fenders, that,s front fenders, made out of Noryl GTX, and if you look at the C4 here in the road in China. So I think there are many examples to come, that people also hear  about the cars looking for light weight solutions, so we can get all the exterior body parts, and look for glazing opportunities which gives you freedom, if you look at the panoramic view, where you can look outside.

Gasgoo: Yeah, that's right.

Eric:  And as a consumer, environmental solutions, I think people are very conscious about the materials that they use. I actually just want to take one example, talked about environment, we recently launched a new product range, which we called Valox iQ. It's basically made of these plastic water bottles we normally throw away. We have developed the process that we take these down in a chemical way to its building blocks; upgrade it again to a prime quality, very good quality material that is being used, for example, on a front part of a bumper system or being used on the doors. I think that's a very example of our environmental friendly way of giving solutions to our customers.

Gasgoo: So what are the main customers in China market currently?

Eric: I think at the moment we supply to all major OEMs here in China, as well as joint venture companies, and some of the local companies.

Gasgoo: For local companies, like for example?

Eric: I think it's very difficult to give an exact example, because we have them in front where we talked about this application, that's our policy. But I think if you look at cars, specifically domestic, look at the lighting systems on the cars, the light you see, look at the grills, look at the door handles, and it is a big chance, it's all made of our materials.

Supporting Chinese Market with R&D   

Gasgoo: What's the biggest difference when you contact the joint venture or the local car makers during the communication process?

Eric: I think the communication is essential, that's a great question. When in joint venture companies, often the reference and the frame, people understand that some of the applications are better, because they have constant information. Sometimes with the domestics OEMs we have to spent more time to train the people because a lot of people are relatively young compared to let's say, people in Europe who work in car manufacturers, or in America, I think it's our pleasure, we spent a lot of time educating, training people on plastics because I think it's also our job to tell people what's possible plastic materials, etc.

Gasgoo: As for the technology, did you bring major technology into China or develop some new technology in China?

Eric:  We want to do both. What we try to do is to introduce all the technologies which use globally, also to the China market. But in general hand, like you said earlier, customers are number one, so our basic approach is also to understand what Chinese customers want, what is the requirement of Chinese OEM, and that might give a different solution, so we tell people this is being used globally, but we also ask our customers what do you want, what do you need, what are the requirement you have to work with, so we have both and actually, we're investing a lot in China, also the R&D resources, for motor vehicles, in China, for China, so that we can develop solutions in China, which is suitable for China market.

Gasgoo: So how's your general comment on the competitors in China market?

Eric: Competitors in terms of material suppliers?

Gasgoo: Material suppliers.

Eric: I think I can just through emphasizing the strength that we have. I think if you compare the overall scenery, I think we are known as the biggest innovator in the automotive industry. We spent a lot of time with our customers, really understand their needs, I think we spent a lot of time to help our customers not only on the materials but also how to design and engineer, with our materials, how you process our materials, and how you can basically address the key needs that everybody has in automotive, the weight out, a few efficiencies, and environmentally conscious solutions, more safety and design freedom, 'cause everybody wants design freedom. I think we are certainly on those elements, I think we are best choice for our customers.

Gasgoo: Comparing with the Du pont, what’s the advantage of your company?

Eric: I just want to stress our strength in this case. I think we are strong, we have local manufacturing, we have local technology people, I think our approach to the market is different, we listen very carefully to our customers and really help them all the way, not just send them back and forth, and we look also in the future, see what's happening in the future we can anticipate the needs, and work together with our customers to make them successful.

Eric: When we mention the application of plastic in automobiles, definitely there is an obvious gap between the China market and the major markets. Do you have any suggestions on this part?

Eric:  I think if you look at plastics used, in our world it's called engineering thermal plastics, where in foam or rubber, so if you spit it out, I think you are right, at the moment there are less use of engineering thermal plastics in China cars. But it is also partly due to the to mix of cars you have in China, so if you look at the CD, E-type vehicles, higher end vehicles in China, I think it is very close to what is being used in the rest of the world. If you look at the A and B vehicles, we have always seen their traditionally less use of engineering thermal plastics, so I think the mix in China are also driving those statistics. I think going forward, there will be more safety requirement in the cars, also in China and that will drive up the use for engineering thermal plastics, there is also a huge need for weight out, so that will also in back the use of engineering thermal plastics , Also the use of electronics, there is more and more electronics being used in the car, even thought you don't see them, there are all kinds of behind the scenes, plastics or plastic applications which are in a car. I think if you add up those trends, that will very soon, I think Chinese market is similar to the global market.

Gasgoo: How many factories do you now have in the China market?

Eric:  We currently have 3 factories in China, one in Shanghai, one in Nansha and one in Zhongshan.

Gasgoo: Are they joint ventures?

Eric:  Those are fully owned entities.

Gasgoo: In future five years, how many new factories do you want to build?

Eric: I think we will just expand our facilities in Shanghai, as well as our facilities in Nansha, and we will continuously evaluate where the market demand is, because our strategy has always been, to bring our production facilities as close as possible to our markets.

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