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The Turning Point of TDI Consumption in Auto Industry has Appeared
Updated: 2018-02-07 17:36 Source: PUWORLD share:

Wide application of TDI foam in auto industry

Chart 1: Proportion of Downstream TDI Consumption (Unit: %)

We are quite familiar with automobiles. Automotive interior, as a vital part of vehicles, involves every aspect inside automobiles, such as dashboards, steering wheels, seats, roofs, mats and so on. Among them, the production of seats, mats, and window shades all employs flexible polyurethane foam, being important fields for TDI consumption.

According to Orisage Consulting, the TDI consumption in auto industry during 2017 isabout 60,000 tons, which serves as a major downstream industry for TDI.

Lightweight of auto seats reduces foam consumption

With more and more attention paid to energy saving and emission reduction, it’s natural that auto industry, as a major energy consumer, receives significant attention. Apart from taking measures like producing small-displacement, new energy vehicles, practicing lightweight also serves as an important method of energy saving.

Zhang Ning, the deputy secretary general of China Automotive Engineering Society, introduces that a 10% reduction in the weight of a vehicle equals a 7%-8% decrease in fuel consumption and a 4% decrease in emission; if the weight of a truck lowers by 1000kg, then its oil consumption could decline by 4%. At present, lightweight of auto has become an industrial development trend worldwide for achieving environmental protection and energy saving.

Speaking of lightweight of vehicles, the immediate concern remains to be the one of foam itself. According to Orisage Consulting, a seat and a headrest usually contain foam weighing around 2 kg and the seat assembly in one vehicle all together might contain foam weighing about 10 kg. The current foam upgrade mainly adopts improvement technology and formula, which achieves lightweight of auto while maintains excellent support and comfort level. Foam is closely related in this aspect.

Proportion of TDI foam in auto seats declines

Chart 2: 2016-2018 TDI Price Trend (Unit: RMB/tom)

Promoted by prosperous downstream demand and booming upholstered furniture industry, other industries also maintained stable growth. As a result, TDI prices stay elevated throughout 2017, especially in Q4. TDI prices keeps above RMB 30,000/ton and the peak even reaches RMB 44,000/ton.

High TDI prices make the cost of foam increase sharply. Supposing the proportion of isocyanate and polyether polyols in foam is 3:7, then the average TDI price throughout 2017 increases by 69.3% compared last year. The result of a rough estimate suggests that the feedstock cost of foam increases by about 20.79%. Meanwhile, the national standard of in-vehicle VOC emission becomes more rigorous and also customers are more demanding in terms of the comfort level of seats. Thus, an increasing number of factories adopt MDI foam.

Chart 3: Proportion of TDI and MDI foam in Auto Seats (Unit: %)

A turning point of TDI consumption perhaps will appear in auto industry

As the technique improves, manufacturing enterprises also keep changing their choices of raw materials. Since TDI factories mostly maintain higher operating rate at present and supply is sufficient with prices stay elevated, we’ re not worried about the overall TDI market. According to Orisage Consulting, the overall apparent consumption in TDI industry during 2017 keep a growth rate of about 4%-5%.

However, since lightweight of auto seats lowers foam consumption and impacted by factors such as stricter national standard of in-vehicle VOC emission and customers’ increasing requirement towards seats in terms of comfort level, the proportion of MDI foam keeps expanding, which also seizes market share against TDI foam. Perhaps TDI consumption in auto industry has already underwent fundamental changes.


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