Dow Corning focusing on China for Asia investment

Date: 10 November 2003
Source: Taipeitimes.com

Date: 10 November 2003

Dow Corning Corp, the bankrupt maker of silicon-based products, said it's seeking to make a major investment in Asia for another plant and plans to focus on China.

The company, based in Midland, Michigan, wants to invest "several hundred million of dollars" on a plant in Asia and is considering several sites in China, Chinese unit president Ian Thackwray said at a chief-executive-officer conference in Hong Kong.Dow Corning, the world's largest supplier of silicon, has spent US$30 million on a plant and laboratory in Songjiang Industrial Park on the outskirts of Shanghai.The company plans to expand the lab to double technical services and development capability.

"For Dow Corning to remain a leader in silicon-related products and services, we need to have a strong presence in China," Thack-wray said in an interview on Thursday.

Dow and other companies, including Metro AG of Germany, are seeking to increase income from China, which is growing at the fastest pace among the global top 10 economies. They're drawn to the cheap labor and consumer prospects presented by 1.3 billion people in the world's most populous nation.

"There has been a quite a continued shift of global manufacturing base to China and that will be the case in the coming 10 years," said George Leung, an economist at HSBC Securities Asia Ltd.

Dow Corning, a venture between Dow Chemical Co and Corning Inc, makes silicon-based products, materials used for electronic goods and emulsions in China, a market the company entered a decade ago. The company took a majority stake in a rubber compounding business in Shanghai in July.

More than half of Dow Corning sales from about 7,000 products and services are from outside of the US. The company, which makes sealants, coatings and other products made from silicon, a plastic with temperature-resistant properties of glass, had sales of US$2.61 billion last year.

Thackwray didn't give a sales breakdown for China or Asia.

In Asia, Dow Corning has eight plants, including three in Japan, two in India and one each in South Korea, China and Thailand. The company has warehouse operations in Singapore, Hong Kong and Taiwan.

Corning Inc, the world's biggest maker of glass for liquid crystal displays, plans to spend US$180 million expanding its glass-making facilities in this country, the Central News Agency reported last last month.

Corning will expand an existing plant to meet Taiwan's growing demand for glass used in flat panels. The expanded plant is slated to start production in the second quarter of next year, the report said.

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