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Promising Future for Plastics Industry With More Growth Expected

By Felipe Villarreal - Alian Plastics
CEO

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By Felipe Villarreal | CEO - Wed, 05/17/2023 - 15:00

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As Peter Drucker aptly put it, "The best way to predict the future is to create it.” 

We live in an era of constant evolution and constant change to maintain business growth. 

I was recently interviewed by the German public state-owned international broadcaster Deutsche Welle. The reason? Business growth. Given the recently announced Tesla investment in Monterrey, Nuevo Leon, the news broadcaster did a report with key players in the automotive sector: government, automotive Clusters and manufacturers, in which category I was honored to participate, as we manufacture plastic injection parts for Tesla.  

The reason why I am mentioning this event is because it was driven by the multibillion-dollar investment from a company that manufactures electric cars, and that trend in this market will continue to grow over the coming  years. As part of that, plastics will continue playing an important role, even greater than it already is today. The trend in the auto industry is to make lighter cars,, but in other industries, too, the trend is to reengineer metal-mechanical parts in favor of plastic parts and thus have a lighter product.

To understand how plastics have been growing through the years, here is some interesting history taken from  an article in Plastics: The Magazine: “Back in the 1970s, polymers were first used to decorate vehicle interiors: skins, coverings, woodwork, and more. Thanks to their ability to withstand impacts and aging, polymers, and, in particular, thermosetting and subsequently, thermoplastic resins, would be used widely for external applications in the 1980s/90s: headlights, bumpers, fenders and then tailgates. Polymers would first appear in semi-structural parts in the decade between 2000 and 2010. This was when manufacturers began their efforts to reduce their vehicles’ weights and replace traditional materials such as steel and aluminum.” 

This short part of history in the plastics evolution in the automotive sector provides a sense of how plastics had been growing in  industry.

The manufacturing environment for plastic injection really  has a bright present and future in different markets, after having passed through difficult times, including ; like lack of resins worldwide, the COVID-19 pandemic, which resulted in an environment of distrust. But we are moving beyond these difficult moments and must focus on business opportunities and growth. 

Vehicles from the 1950s had almost no plastic. The typical automobile today has more than 120kg of plastic.Its use leads to greater fuel efficiency, and the expectation is that by 2050 one car will contain an average of 300kg of plastic, a shocking 250% increase versus  today's average. It has been determined that every 10% drop in vehicle weight equals a 5% to 7% decrease in fuel usage.

Almost all plastics are made from oil, gas and coal. They account for 9% of global demand for oil and 3% of global demand for gas and, by 2050 ,could account for 20% of oil demand (World Economic Forum et al., 2016). The main types of plastics used in the automotive industry are polypropylene (PP), polyurethane (PUR), polyvinyl chloride (PVC), acrylonitrile butadiene styrene (ABS) and fiberglass.

Plastic Injection is unique, and it does require a strong specialization or technical background. The bright side of the business is that the plastic components cost less to manufacture.  Using plastics in vehicles goes hand in hand with the goal of reducing a vehicle’s adverse impact on the environment, as they weigh less and also offer cost efficiency.

In Mexico’s manufacturing environment, I am taking in the nearshoring boom caused by the pandemic, with plastic Injection being the second-most searched industry in the region. 

Companies are re-engineering their metal mechanic components and converting them into plastics because they need lighter and less costly components. 

It is very inspiring to watch the automotive world moving toward having more plastic parts in vehicles; and as plastic is very expensive to transport, OEMs want  to have plastic parts close to their manufacturing sites, which is part of the nearshoring boom that we are experiencing. 

The timing is  becoming critical for new plastic components development, pushing the entire organization to speed up mold engineering design and fabrication to have the first quality  prototypes in production. As a result, the present and future of plastics is and will be very bright, but it also requires your full attention. Companies need to step back and analyze all the requirements and properly manage current and new products. 

Alongside plastic injection parts growth, your stakeholders should be moving at  the speed  required by the industry. Value chain collaboration is essential and important for success, so you need your suppliers, your people, and your customers to work as one team toward  a common goal. The need to bolster the plastic industry’s requirements will also increase speed and collaboration with suppliers and customers.

It is important to mention that business growth in the plastic injection industry requires the support of human talent from the different third parties working with you.

Recalling the history of the use of plastics in automobile manufacturing, in which plastics debuted before World War II, and that by the 1950s, most cars were still made entirely out of steel, and looking at the present and future of the plastic injection parts industry as it relates to cars, and the use of which in vehicles will increase 250% b 2050 compared to today in 2023, leads me to confirm the great future of this industry. These factors also make me want to find ways to manufacture plastic injection parts in a more efficient and automated way to support the growth that is coming and that is already taking place in this sector. 

Until the next time. Keep Safe!

Photo by:   Felipe Villarreal

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