HONG KONG/LUDWIGSHAFEN, Germany – BASF has outlined its Strategy 2020 for Asia Pacific, with the goal of growing a average of two percentage points faster than the Asia-Pacific chemical market each year. With expected market growth of four to five percent per year, this would double regional sales by 2020 while earning a premium on cost of capital.
This ambitious strategy is based on growth and new business initiatives. Under its new strategy, BASF will initially target five key growth industries in the region, will increase headcount in the region and plans to generate 70 percent of regional sales from local production. At the same time, the company will invest in the Asia-Pacific region and will work to create efficiency improvements that will save money.
To support the goal of producing 70 percent of its sales within the Asia-Pacific region, BASF plans to invest EUR 2 billion between 2009 and 2013. This amount includes BASF’s 50 percent share of the $1.4 billion expansion of its integrated chemical production joint venture in Nanjing, China, which was approved by the national government in July 2009. In Chongqing, China, BASF is in the planning phase for a 400,000-ton-per-year plant for MDI, a precursor for polyurethanes. BASF and the Chongqing authorities aim for mechanical completion of the plant by the end of 2013 and commercial operation by early 2014.
In Asia Pacific, BASF will organize its sales efforts around key industries in order to grow faster than the market. The company has established an initial set of industry target groups where it intends to become a preferred supplier, including the automotive, construction, packaging, paint and coatings, and pharmaceuticals industries. BASF will also actively seek opportunities to support rapidly developing customer markets in relatively untapped locations, including Vietnam and inland China.
BASF plans to implement an enhanced development plan to strengthen its existing local talent base. By 2020, BASF expects to increase its headcount in Asia Pacific by at least 5,000. The company plans to double the number of employees in research and development by 2020.