RadiciGroup, Italian chemistry crushed by expensive energy
It’s a difficult 2023 that lies ahead RadiciGroupfourth group by size of theItalian chemical industry. The reason, as explained by the president of the Bergamo group Angel Roots, it’s all in the cost of energy. Last year had already been difficult for the group which is a leading producer of nylon (polyamide 6 and 66) which is then transformed, again by internal companies, into technopolymers and yarns for the automotive, clothing, electrical and electronics, construction and medical.
A surge in costs that led RadiciGroup to close the Novara chemical plant for two months. Now production has restarted, but “demand for polymers is still weak” the president stressed. “Today we have returned to full capacity at the Novara plant but still with very low volumes because our customers are very cautious and only order what they can consume”.
Invasion of the market by Asia and the United States
Furthermore, last year there was “the invasion of the market by countries that produce at much lower costs” continued Radici. “It’s about Asian and American multinationals which, thanks to the very low cost of energy in their own countries, they have flooded Europe with cheap polymers, taking away some of our customers”. In fact, in the chemical sector, the value of gas impacts 80% of production costs.
The Radici group closed 2022 with a turnover of 1,542 million eurosmade in over 30 productive sites and employing 3 thousand collaborators, half of which are active in Italy. “By serving the automotive industry we have become global and we follow our customers in the various local markets where they produce” continued the president. “The market of the automotive sector is worth 50% of our consumption and but in the last two years there has been a drop in demand in Europe”.
Polymers run thanks to the car
In other areas, especially in China, the automotive sector is growing above all thanks to the electricity sector. Indeed the division High Performance Polymeres last year it recorded a turnover of 629 million euros against 248 million a decade ago. An unstoppable growth that even a possible European rethinking of stopping the internal combustion engine in 2035 would not affect.
“We have already developed applications for the electric motor,” he explained Cesare Clausi, global sales manager of RadiciGroup High Performance Polymeres “and therefore even if the transition will be slower or with efuel fuels it would not lead us to a particular reorientation”. RadiciGroup in High Performance Polymeres now has a global presence, to the point that “our top 20 customers account for 40% of our turnover and 18 are in the automotive sector”.
Fewer cars produced in the world, but electric vehicles are growing
The crisis in the car sector can be easily understood starting from the numbers: in 2017 they were produced in the world 95 million cars against 82 million last year. “According to the most recent analyzes in 2034 we will arrive at 102 million passenger cars produced of which 57 million will be electric vehicles” Clausi underlined.
The “parity” between the two sectors will occur in 2028 when the production of electric cars will be 30 million, equaling those with internal combustion engines. The Chinese manufacturers take advantage of this, which “in 2022 made 26 million cars which will become 34 million in 2034”. This is why RadiciGroup is growing in the area. “We have been in China since 2007 and next month we are opening a new factory which practically doubles our production capacity”.
With that production platform, the company serves both Chinese and European customers who produce in the Dragon country. “Also Byd he is one of our customers” confirms Clausi. “A real powerhouse that last year produced 1.9 million vehicles surpassing Tesla“.