Skip to Main Content

Cover Story

June 12, 2006
Volume 84, Number 24
p. 16

MADE IN JAPAN

Dow, DuPont Get Serious With Japanese Car Makers

Alexander H. Tullo

The diverging fortunes of U.S. and Japanese car makers have been all over the newspapers for the past couple of years. General Motors and Ford Motor Co. are losing money and perhaps facing bankruptcy, while Toyota has been raking it in. Toyota recently overtook Ford as the world's number two automaker and now has its sights set on eclipsing GM.

These trends haven't been missed by two of the largest American chemical companies, Dow Chemical and DuPont, which have organizations devoted to selling a large portfolio of products to automotive original equipment manufacturers (OEMs) and their parts suppliers.

Last October, DuPont opened the DuPont Automotive Center in Nagoya, Japan-near where Toyota is headquartered. From there, a staff of 60 is targeting Japanese OEMs and their suppliers with DuPont paints, engineering polymers, electronics, fluoropolymers, and high-performance fibers. In April, Dow opened the Dow Automotive Technology Center in Kawasaki, Japan, from which it will market plastics, adhesives, sealants, fluids, and other products to the Japanese car industry.

George Hamilton, president of Dow Automotive, acknowledges that the move is in Dow's best interest, given the success of Japanese automakers at the expense of U.S. firms. "Being in the Midwest, we hear a lot about the hometown teams," he says, adding that the overall U.S. industry growth has actually been strong. "Some participants in the market are growing at 8-9% annual rates, and some regions of the world, such as China, are growing at double-digit rates."

The Japanese car market itself isn't fast-growing, Hamilton points out, but it is still large with millions of units annually. Moreover, the Japanese "Big Three"−Toyota, Nissan, and Honda−make decisions that sway a third of the auto market worldwide. "For us, we look at that as a third of the market that we have struggled to participate in because we have not made the commitment to be local in Japan and to serve the local OEMs," Hamilton says.

Christopher S. Murphy, a director at DuPont Automotive Performance Materials, agrees that it makes sense for both Dow and DuPont to put feet on the ground in Japan. "It is certainly no secret that the Japanese OEMs have been extremely successful globally," he says. "Both of us are strong auto centers with one-stop-shop approaches in North America. This is an opportunity to formalize that approach in Japan to make it easier for the Japanese OEMs to work with DuPont in various product lines."

Murphy adds that the move to Japan helps DuPont serve existing customers that are targeting the Asian market for similar reasons. "It also allows us to better work with our customers that may be North America-based and may be Europe-based," he says.

But the ascension of the Japanese auto industry is hardly new. Mark Kingsley, head of global automotive marketing at GE Plastics, boasts that his company has been selling to Japanese car makers for decades. Kingsley himself is based in Japan, and five years ago his company established a crash-testing center in Moka, Japan. Referring to Dow and DuPont, he says, "Welcome to the party. We have been here since the 1970s."

Dow's Hamilton concedes that his organization is taking the first steps on a long road. "What we have learned about the Asian producers is that they are very loyal to their existing supply base," he says. "If you want to be successful, you need to bring something innovative. We have some unique foam and adhesive technologies that they cannot get from their existing supply base." These technologies, Hamilton adds, are opening doors.

Hamilton is optimistic that Dow has the resolve to make it in Japan. "It is a slower process, but not unlike the 25-year journey we have had with the car companies in the West," he says. "You start small, prove yourself, bring some solutions, leverage those to other vehicles, and someday you wake up and have a great position."

COVER STORY - PLASTICS

Driving Efficiency

High-performance plastics are finding increased relevance as a way to make cars less costly to manufacture−and fill up at the gas pump

Made In Japan

Dow, DuPont Get Serious With Japanese Car Makers

Chemical & Engineering News
ISSN 0009-2347
Copyright © 2010 American Chemical Society

COVER STORY - PLASTICS

  • Driving Efficiency
    High-performance plastics are finding increased relevance as a way to make cars less costly to manufacture− and fill up at the gas pump
  • Made In Japan
    Dow, DuPont Get Serious With Japanese Car Makers

Articles By Topic