Basell plans 2nd China PP compounding plant

33 million pound facility will supply automotive and appliance manufacturers.

Basell NV has announced plans to build a second polypropylene compounding plant in China, in the automotive and consumer products manufacturing center of Guangzhou.

The 33 million-pound facility will open in September, making PP compounds and alloys for the local automotive and appliance manufacturers.

The factory will join a larger PP compounding plant in Suzhou that Basell opened in 2005. The Hoofddorp, Netherlands-based company last year expanded the Suzhou site ahead of schedule, and suggested the Guangzhou site could grow as well.

Frank Noeltgen, Basell’s automotive vice president for the Asia-Pacific region, said in a news release: “This initial capacity [in Guangzhou] could be easily expanded to more than 110 million pounds based on future demand growth.” He added: “Basell is strongly committed to further growing our presence in China to address the continuous increase in demand.”

Basell officially became Lyondell Basell Industries yesterday, when its merger with Lyondell Chemical completed.

Most of Basell’s business is with foreign manufacturers in China, such as the heavy Japanese automotive presence in Guangzhou. However, the firm is selling more to domestic Chinese automakers as they raise their quality, Noeltgen said in a telephone interview.

It remains to be seen if the Chinese government will be successful in cooling down the China auto market, but he said it could be difficult. He added that Basell’s investment is conservative and assumes somewhat slower growth rates.

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