Chemical Industry Restructuring — the Development Trend of Chemical Industry in the Future

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Chemical Industry Restructuring — the Development Trend of Chemical Industry in the Future

Post  lilyqianweiku on Fri Jul 08, 2011 10:23 am

The production index of global chemical industry in 2009 showed that the production of chemical industry decreased by more than 10% in the first quarter of this year. Recently, relevant report predicts that in the next few years, the chemical industry is bound to face large restructuring. The report points out that, with the increase in mergers and acquisitions, chemical facilities will be reduced, and the business geographic coverage of chemical enterprises will be more extensive.

Deloitte Global Manufacturing Industry Group believes that, "Although market demand will grow again, however, it is unlikely to recover to the level before the economic downturn within such a short term. As a result, chemical companies are planning to adopt flexible strategies to predict market demand and supply." TimHanley, the vice chairman of Deloitte and the leader of processing and industrial products industry of United States, says, "As there are some uncertain factors in the market, chemical companies are working hard to develop effective plans for the future. Try to create new business models to attract new customers and new suppliers, and it may help enterprises go through these challenging periods."

The performance of chemical industry is closely connected with the automotive and construction industry. In the next few years, the chemical industry is bound to face major restructuring. The report shows that, by the prediction of different situations in the future, it is probably that chemical enterprises can evaluate all possible outcomes, consider relevant variables, and prepare responsive solutions to make profit flexibly. As merger activities may increase, chemical facilities will decrease, and the business geographic coverage of chemical enterprises will be more extensive. This will make the business distribution of enterprises more balanced in the world. What's more, from the perspective of demand and supply, Asian will play a role more and more important in the chemical industry. However, without the government assistance, chemical industry will face much more special challenges.

TomMarriott, the supervisor of Management Consulting Service of Deloitte, says, "Part of the challenge is to separate real economic growth from the results of economic stimulus package. The government funds to stimulate the economy will become the key factor to help enterprises regain motive power." He also mentions that, "As China has invested a lot of funds to stimulate economic growth, it exerts indirect influence on the market demand of chemical industry. Therefore, multinational enterprises are also considering whether to put more investment in China and Asia Pacific regions."

From this we can see that in the next few years, the restructuring of chemical enterprises will become the development trend of the chemical industry.

lilyqianweiku

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