Market expansion may be more worldwide than local
Staff -- Purchasing, 1/12/2006 2:00:00 AM
Increasing use of electronics in automobiles is driving a demand surge for plastics used in such components. Market researcher Frost & Sullivan estimates that plastics used in automotive electrical and lighting systems worldwide will rise from $642.4 million in 2004 to $931.7 million in 2011.
"Market dynamics force auto manufacturers to introduce new products frequently," says Frost & Sullivan researcher Deepak Tulsian. "As a result, they pressure their suppliers to develop new products with reduced development time, to enhance their features, and at the same time to cut costs." Thus, plastics firms must have the ability to develop new products within short spans of time to remain successful suppliers to the automotive industry.
But, since the domestic automotive production has witnessed low growth rates over the last few years, plastics suppliers are looking at other electrical markets along with a shift to new products demanded by various automotive manufacturing industries outside North America. Tulsian says that's why some plastics companies invest in manufacturing facilities in China and other Asian nations.
Now Playing: 