This presentation will cover the Composite Market growth trends and Owens Corning glass fiber product developments for end-user productivity and product performance improvements. The presentation includes Owens Corning product developments around sizing chemistry, product property and glass chemistry innovations that deliver a range of product solutions in key glass fiber market segments including wind energy, automotive, construction and industrial applications.
Enhancing the performance of key composite applications through new glass reinforcements This presentation will cover the Composite Market growth trends and Owens Corning glass fiber product developments for end-user productivity and product performance improvements. The presentation includes Owens Corning product developments around sizing chemistry, product property and glass chemistry innovations that deliver a range of product solutions in key glass fiber market segments including wind energy, automotive, construction and industrial applications.
ASA K. YAMADA Director, Thermoset Marketing Owens Corning, Composite Solutions Business
Glass Fiber Composites A positive story of accelerating growth, providing key benefits
Glass Fiber Composites replacing traditional materials (Aluminum, Steel, Wood)
Composites key values of light weight, high strength and corrosion resistance fit with the key challenges facing the world: clean energy, & water, infrastructure, urbanization , light weighting
0
0.8
1.2
1.6
3.7
Wood Steel Aluminum Glass Fiber Carbon Fiber
Materials Growth as a Multiple of Change in Industrial Production
Global Market Size (Indexed to Glass Fiber)
Growth multiples over 1981-2011, except carbon fiber which is 1990-2011. Global market sizes estimated in revenue USD as of
2011
Source: IHS Global Insight, Owens Corning management estimates, World Steel Association, Food and Agriculture Association of
the United Nations, U.S. Geological Service
Glass Fiber Growth Compared to traditional materials
Glass Fiber Growing as a Substitute for Traditional Materials
26 111 14 1 0.1
*75% confidence interval; “excellent correlation” defined as >95% R2
Source: IHS Global Insight, Fiber Economic Bureau, Glass Fiber Europe, Global Trade Information
Services, Inc. and Owens Corning management estimates
1101009080706050
4000
3000
2000
1500
1000
Industrial ProductionIndexed: 2005=100
Log Basis
Gla
ss F
ibe
r M
arke
t (K
ton
s)Lo
g B
asis
Global Glass Fiber Demand vs. Industrial Production
1981-2011
4000
3000
2000
1500
1000
Industrial Production Indexed: 2005=100
Log Basis
50 60 70 80 110 100 90
Gla
ss F
iber
Mark
et (K
tons)
Log B
asis
Global Glass Fiber Demand Grows at 1.6 Multiple of Industrial Production Growth
Excellent 30-year correlation
Glass fiber / industrial production growth multiple:
30-year average: 1.6
Any 10-year period: 1.3-1.7*
Any 5-year period: 1.0-2.0*
Glass Fiber Growth Driven by Global Industrial Production
1
10
1981 1991 2001 2011
Gla
ss F
iber
Dem
and
(M
M T
on
s) -
log
bas
is
Glass Fiber Market Outlook
6
Glass Fiber Market Demand 30 Years Averaging 5% CAGR
2013-2016 Growth Forecast
2017
Glass Fiber Market Expected to Continue to Grow at Historical Rates
About 60% of Growth Expected to Come from China
Glass fiber market demand excludes E-glass yarns
Sources: Fiber economic bureau, Glass Fiber Europe, Global Trade information Services, inc. and Owens Corning management estimates as of Apr 2013
-
250
500
750
China Americas EMEA Rest of Asia India
Dem
an
d G
row
th (
k t
on
s)
Megatrends Forecasted Glass Fiber
Growth 2013, 2014 *3 Industrial Production
Growth*1:
Population Urbanization Sustainability
4.8% CAGR
+400-500kt
2013 – 1.9%
2014 - 4.1%
X Material
Substitution *2: 1.6
Industrial Production by region *1
( yoy growth%)
Resilience in 2012
2011 2012 2013F 2014F
World 3.1 1.6 1.9 4.1
N America 3.4 3.4 2.4 3.4
Euro zone 2.3 (2.7) (0.7) 1.8
China 10.3 8.1 7.5 7.0
Japan (2.3) (1.0) (0.0) 5.6
Latin Am 3.2 (0.0) 2.0 3.6
India 4.8 0.7 3.3 6.5
US Industrial Production quarterly (Growth, %) *1
• 2014 forecast with increasing strength and North America and Europe offsetting slowing developing economies
• The acceleration forecast through 2013 was slower and less pronounced • 2014 IP is forecast to return to historical levels
Economic Forecasts
1
2
3
4
5
2,8 3,6
Q1 2013
2,5
Q1 2012
4,8
Q3 2013
2,5 3,4
2,0
4,5
Q3 2012
4,0 4,6
eQ3 2014
4,0 3,9
eQ1 2014
Source: Oxford Economics. February 2014
Construction 34%
Transportation 27%
Industrial 15%
Consumer 16%
Wind 8%
Glass reinforcements market defined as glass fiber reinforcements and direct conversion products as consumed, excluding yarns
Source: Owens Corning management estimates
• Residential • Commercial • Water transportation
& storage
• Cars • Trucks, buses, trains • Marine
• Factories • Mining • Offshore platforms
• Appliances • Electronics • Recreation
The benefits of composites continue to drive penetration and growth
Miniaturization
Maintenance free living
Corrosion resistance
Productivity
Skilled labor shortage
Aging Infrastructure
Light weighting
Productivity
Glass Fiber A $7 Billion Global Market
Light Vehicle Production, MM Units*4
Key Trend; EURO 5,6, & NA CAFÉ
regulations require lower vehicle weight to
meet CO2 / mpg targets
Governments are implementing regulations which are driving applications for composites.
Composites penetration is forecast to hit 25kg per vehicle in 2020
20
25
30
35
40
45
50
55
60
65
70
2005 2010 2015 2020
CAFÉ
Fu
el E
con
om
y R
equ
ire
men
ts
(mp
g b
asis
)
A 1mpg miss can result in up to $55/vehicle penalty *1
1) http://www.cato.org/pubs/regulation/regv25n3/v25n3-8.pdf 3) Plasmart, MarketsandMarkets Report, Transparency Market Research
2) http://www.un.org/esa/dsd/resources/res_pdfs/csd-19/Background-paper3-transport.pdf 4) IIHS Global Insights and CSM Auto Forecast December2013
Comparison of Fuel Economy Standards *2
9
Transportation Market Driven by Vehicle Light Weighting
Automotive Impact: • On average glass fiber consumption per car is 8kg globally *1
• 500K units creates 4,000tn of demand • Unit usage forecasted to double to 16kg/unit by 2020 *1
Transportation Market OC™ Product innovations: Direct Roving for Long Fiber Thermoplastics
Poor adhesion between fiber/resin
No Resin Bonding
Good adhesion between fiber/resin
Excellent Resin Bonding
Sizing chemistry to improve the glass / polymer interface
Focused developments on FRP bonding performance
PERFORMAX® SE4502 Roving
for LFTP PA
Improved glass adhesion to PA enables:
• 30% improvement in impact
• 15% improvement in tensile/flex
PERFORMAX ® SE4849 Roving
for LFTP PP
Excellent glass processing/wet-out enables:
• 20% higher line speeds
• Increased glass loading for new
applications
Transportation Market OC™ Product innovations: Direct Roving for Long Fiber Thermoplastics
Key Trend: Shortage of skilled labor, stricter
codes & green building trends drive the
adoption of composites in construction
sector. *1
Aging Infrastructure
Productivity Improvement Materials Conservation
Weather & Disaster
Source: 1)FMI Forecast 2013, McGraw Hill World Green Building Trend, Innovation in Construction Summit2) US Census Bureau and Freddie Mac January 2014 4) CompositesWorld
Construction Market Driven by Durability, Toughness, Strength
Housing Starts:
1 house = 100kgs of glass on average *4 (roofing shingles, tub/shower, window lineals , doors etc.)
1,0
0,6
0,8
0,4
1,4
1,2 CAGR+21%
e2015 e2014
1,10
1,35
MM Units
2012
0,92
2013
0,78
Housing Starts*2
Construction Market OC™ Product Innovations: Multi-end Roving for Spray-up
Physical Property Developments
• Glass fiber micronage, bundle tex, bundle integrity and stiffness
• Sizing chemistry for end product smoothness, resin impregnation
Construction Market OC™ Product Innovations: Multi-end Roving for Spray-up
Focused developments on downstream fabrication process performance
OptiSpray ® F Multi-end Roving
for Spray-up
• High runnability, low gun stoppage
• High dispersion, easy too roll
• Good laydown, low air entrapment
• Fast wet-out, excellent conformability
• Higher glass/resin ratio
Key trend Glass fiber composites are now
lower first cost than stainless steel
Increasing demand and extraction costs for Nickel and Chrome have increased stainless steel costs. This trend is forecast to continue. For many applications composites are now a lower first cost.
Composites, with 1.2MM tons used annually (800kt of glass fiber) in the corrosion market, still only compose 0.2% of total corrosion materials market.
1) IHS Global Insight December 2013
2) IBIS and Associates, July 2012. Simple single wall cylindrical tank, no manway, vents, flanged ports etc.
$0
$5,000
$10,000
$15,000
$20,000
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000
cost
pe
r ta
nk
Tank Size - Gallons
Tank Cost Comparison Composites vs Stainless Steel *2
Industrial Market Driven by Durability, Long Life, Corrosion Resistance
Industrial: Each mile of 4 inch diameter pipe
contains approx. 4 tons of glass fiber
Adding a Flue Gas Desulphurization (FGD) system to a 9GW coal fired power plant uses approx. 8-9,000 tons of glass fiber
• Increased epoxy resin bonding • Protection for glass fibers
E- Glass Advantex® Glass
Conventional E-glass breaks down when FRP laminate is exposed to 10% sulfuric acid at ambient conditions
Industrial Market OC™ Product Innovations: Direct Roving for Filament Winding
Advantex® SE 2307 Type 30 Roving for High Pressure Epoxy Pipe
76647
50098.3
55054.3
Aromatic Amine (MDA) Curing System
Commercial
Industrial Market OC™ Product Innovations: Direct Roving for Filament Winding
Pipe Burst Strength
Advance sizing provides step-out improvements in high pressure epoxy pipe burst strength
Key Trend: Wind power forecast to be 12% of global electricity production by 2050 *1 at which time over 2,000 GW of installed wind capacity will annually avoid the emission of up to 2.8 gigatons of CO2.*1
•US Wind Market Positioned for strong near terms growth*2
•Efforts to secure PTC eligibility in 2013 resulted in 13GW under construction and 11.5GW in order intake from Jan 13 to Feb 14 •A potential tax extenders package that include a PTC extension would create upside to the n16GW forecast from 2014 to 2016.
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CO2 emissions reductions by 2050
(share of power sector emissions reductions,
IEA Blue map scenario) *1
Source: 1) International Energy Agency (IEA) Technology Map till 2050. March 2012 2) MAKE Consultant Q4 2013 Report and Flash Note Feb. 2014. AWEA FY2013 report
Wind Energy Market Driven by clean renewable resources
Wind Energy: Each MW of wind energy consumes approximately 7.5 tons of glass fiber*2
This translates to ~13Ktn in 2013 and ~30Ktns in 2014
e2015 2012 2013 e2014
13,8
3,3
8,2 8,2
North America Wind Turbine GW Installed*2
Industrial Market OC™ Product Innovations: Glass fiber fabrics for Wind Energy
Downstream glass fiber engineered fabrics
LONGER BLADES ON-SHORE / OFF-SHORE / IN LOW WIND AREAS
INDUSTRY
TRENDS LONGER BLADES ON-SHORE
Ultrablade® Fabrics
Production of energy with no emission of CO2 (wind, tidal, solar, geothermal)
Providing the basic infrastructure to deliver clean water to excess of 5 billion people
Providing housing and infrastructure to a growing population in developing and third world countries
Reducing the weight of modes of transportation to responding to increasing cost of energy
