Teijin CEO Plans More Capacity for Heat-Resistant Aramid Fiber

Teijin Ltd (3401), a carbon-fiber maker whose clients include General Motors Co. (GM), plans to boost capacity for its aramid fiber to meet demand for the heat- resistant material used in tires and bullet-proof vests.

“Market expectations are quite high, and as it is a difficult technology, profits are expected to be very high as well,” Shigeo Ohyagi, president and chief executive officer of Teijin, said in an interview in Amsterdam. “Aramid fiber is an important strategic field for Teijin.”

Demand for the material will rise 7 percent to 9 percent annually, and the industry now produces about 50,000 tons of the material a year, Ohyagi said. Osaka, Japan-based Teijin produces 25,000 tons of the heatproof product at its Netherlands-based Teijin Aramid site. It competes with DuPont Co. (DD), which produces a similar substance called Kevlar, Ohyagi said.

Growth will be driven by developments such as increasing demand for fiber-optic cables and protective clothing and materials, Ohyagi said. Aramid fiber was also used in combination with Teijin’s carbon fiber in the facade of the newly renovated Stedelijk Museum in Amsterdam.

Teijin, whose clients include European Aeronautic Defence & Space Co., has invested 1 billion euros ($1.29 billion) in its Dutch unit since buying it from Akzo Nobel NV (AKZA) in 2000, according to the company. Teijin will mainly expand production in places where costs are lower, such as Asia, Ohyagi said.

To contact the reporter on this story: Maaike Noordhuis in Amsterdam at mnoordhuis@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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