Evonik: Driving Material Science Innovation and Sustainability

Q: What are Evonik’s expectations as the automotive industry recovers?

A: Mexico’s economic recovery between 2020 and 2021 was export-driven. North America’s automotive industry restarted operations in June 2020 and has been trending upward, with the support from other segments.

The sector’s challenges are now connected to supply chains, logistics and the lack of raw materials, which are delaying the recovery of different market segments and manufacturing. The automotive industry has also been challenged by the shortage of electronic micro-components and microchips, which will continue impacting the sector.

Despite the circumstances, Mexico’s manufacturing and export industries remain strong and will grow with the relocation of supply chains and the nearshoring of manufacturing plants, trends that have been driven by USMCA, the FTA with the EU and the increasing regionalization of manufacturing in the region. Previously, the automotive and aerospace industries spearheaded Mexico’s development as a manufacturing hub and export platform but other industries are now growing, such as personal and household care, agribusiness, oral care, medical devices and appliances. We are seeing a strong recovery and sustainable growth in most market segments, supported by a resilient portfolio of specialty chemicals for manufacturing and exports.

Q: How are exports contributing to the recovery of the Mexican economy?

A: The automotive industry in Mexico is well established and equipped. It has been driven by exports and supported by the production and exports of automotive parts. An increasing number of companies are coming to Mexico due to the relocation of supply chains and the need to be compliant with the USMCA. While FDI in Mexico shrank in 2020, the country was among the least affected.

Investment in Mexico’s automotive industry is here to stay to address global demand. For that reason, we are seeing an increase in R&D and applied technology centers from OEMs, Tier 1s and Tier 2s, which speaks highly about the technical capabilities of the country.

Q: What innovations in material science are helping Evonik's customers reach greater levels of sustainability?

A: Sustainability is a central element of our "Leading Beyond Chemistry" strategy. Evonik provides innovative solutions that help make lives more sustainable, healthier and more comfortable. As a specialty chemicals company present across the world, Evonik sees sustainability and long-term business success as two sides of the same coin. Our customers are increasingly demanding products and services that demonstrate a good balance of economic, ecological and social factors.

Through our innovative capabilities and state-of-the-art technology, we empower our customers to offer a broad range of resource-efficient solutions, such as additives for hydraulic fluids. About 50 percent of the sales by our chemical unit relates to products that make a measurable contribution to improving resource efficiency.

To reduce Evonik's carbon footprint further, we are continuously optimizing our processes along the entire value chain by using alternative raw materials and biotechnological methods wherever possible. Through the initiative “Together for Sustainability,” we are promoting transparency and sustainability along the supply chain. Because we achieved our target for reducing greenhouse gas emissions ahead of schedule, our executive board introduced new environmental targets in February 2019. The new target is to reduce absolute scope 1 and 2 emissions by 50 percent by 2025 compared with 2008. This affirms our commitment to the Paris Agreement on Climate Change. We are reducing climate-relevant emissions by an estimated 3 percent per year.

Q: What role do chemical companies play in driving the innovation of material science?

A: Evonik’s Smart Materials division uses innovative materials that enable resource-saving solutions. These products are continuously adapted to the needs of customers and they are the smart answer to the major challenges of our time: environment, urbanization, energy efficiency, mobility and health. The Smart Materials division’s strong technology platforms pave the way for improved resource efficiency and sustainability. It produces inorganic materials with superior properties, such as silica, silanes, peroxides and specialty catalysts, and high-tech polymers, such as polyamide 12, polyimide, special polybutadienes and polyesters. It also manufactures composites and membranes using those materials.

Our specialties shape fast-growing markets, including coatings, mobility, environmental, infrastructure and consumer goods. Moreover, materials that are more durable, energy-saving or sustainable have a direct effect on the end product.

Q: As a member of ANIQ, what is being done to create a sustainable Mexican chemical manufacturing sector?

A: A solid agenda and clear rules can support the generation of a sustainable Mexican chemical manufacturing sector that benefits from existing production capacities. This sector could be a reliable and competitive partner for the whole Mexican market. Mexico’s chemical industry could play a pivotal role in exports and support demand. There can be no development of manufacturing and production platforms in Mexico without a sustainable and solid Mexican chemical industry. ANIQ plays an important role in leading this strategy and presenting our concerns to Mexican authorities.

Evonik Industries AG is a global leader of specialty chemicals. It is active in more than 100 countries. The company generated sales of €12.2 billion (US$14.45 billion) and an operating profit (adjusted EBITDA) of €1.9 billion (US$2.25 billion) in 2020.