Du Pont Kevlar® Aramid Industrial Fiber

Nikunj, Rubini & Madhuvanthy


Facts …
• Company: Du Pont • Business: Fiber & polymer manufacturing company • Product- Kevlar® Aramid Industrial Fiber • Protagonist:
– Howard .W .Swank- GM, Du Pont’s Textile Fibers Dept.

• Year: 1974

Current Scenario
• Kevlar®Aramid fiber - a miracle fiber of extraordinarily complex chemistry, was his department’s newest development • Submitted a 3-part appropriation request for capital to build a 50 Mn pounds/year plant for its manufacture • Has asked for $82 million of the projected $332 MillionFor the:
– Partial design for the plant and cost estimates preparation – Cancellation cost of longtime delivery equipment


Development of Kevlar
• 1965, Stephanie and Paul developed a polymer which when spun into fiber was highly stable to high temperatures and 7 times stiffer than Nomex, Nylon and Dacron • 1969, the polymer named as fiber-B was tested on selected tire companies (as tire cord material) to key aircraft manufacturers (as a reinforcement in plastic composites) • Feedback from tire companies: “Outstanding product performance superior to all known incumbents”

Problems with Fiber B
• Estimated cost of production was extremely high • To achieve adhesion to rubber tire makers had to apply adhesive for Fiber B under extraordinarily high tensions In 1972, they refined fibre B and it was called fibre B-1. This gave a higher stiffness and tenacity


Request for setting up of MDF (market development facility)
• The chemists at TFD were highly confident Fiber B-1’s performance • They wanted to make most out of the rapidly unfolding events in the tire cord market, aircraft and aerospace industries • They wanted to roll out as much fibre B1 as possible into the market from the plant


Request for MDF- II
– It would contain prototype technology for all of the critical elements of a projected commercial plant – Generates design data and cost data – Annual capacity is six million pounds – In 1972, the request was approved – By the end of 1973, MDF I & II produced a million pounds of fiber at an average cost of $20 per pound. It was now that this fiber B1 was trademarked as Kevlar Aramid Fiber

Kevlar’s Market
• Target Audience
– Tire market – Aerospace and Aircraft industries

• Need
– Fiber for making tire cord (Tire Market) – Composite materials (Aerospace Industry)


Tire Market-Situation
• 1970’s- Radial tire came into being • Nylon and polyester did not posses the properties necessary to make a tire cord for radial belts • Hence, if tire industry took up radials, Du Pont would have to suffer • Fibre-glass or steel could capture the belting market but this was not Du Pont’s forte. They had to clearly preempt steel • Kevlar, the managers thought, would help maintain the business if not command the industry

Kevlar’s Opportunities

Kevlar vs Steel


Kevlar Vs. Steel
• Kevlar was 4 to 5 times stronger than steel • Kevlar’s tenacity and modulus was superior to steel tire cord, except elongation • Steel tire cord was short in supply • Steel tire cord manufacture was highly labor intensive • Kevlar was lighter, energy efficient, smoother ride • Kevlar could be used on tire manufacturing equipment unlike steel • Did not experience problems with handling large radial truck tires

• Kevlar MDF II was hard-pressed to meet the tire industries demand • The dept. projected that a 50 mn pound Kevlar plant would provide the necessary economies of scale for Kevlar to compete with steel tire cord


Kevlar in composite materials
• Composite materials - These were in their infancy stage when Kevlar was first introduced • Boeing and Lockheed had adopted Nomex in non structural aircraft panel composites • This helped secure a significant entry into the composite materials market for Du Pont


Kevlar Vs. Fibreglass
• Kevlar’s density is lower than fiber glass while possessing roughly the same tensile strength and a higher modulus • Substituting Kevlar for fiber glass would reduce weight of atleast 25% adding value of about 25 dollar per pound in aircraft • Kevlar absorbed radar • Kevlar would also have to compete with Carbon & Boron fibers since composites made from carbon & boron are more stiff

Challenges in Tire Industry
• Challenge for Kevlar: Economics of production • To gain market share, pricing of Kevlar should not be more than 4 to 4.8 times that of steel


Challenges in Composite Materials Market • Pricing • Market dominated by Fibreglass. So:
– Prove that plastic composites (in general) and Kevlar (in particular) are better than Fibre Glass Composites


Management Concerns
• Committing a lot of investment capital and several years of operating loss • Since the commitment to new ventures program in 1960’s the short run earnings of the company has been hurt. • To improve this situation the company has to watch its capital expenditure carefully • Agreeing or accepting Kevlar would increase the commitments to $1 billion

Prospects for Kevlar
• • Nomex Slow, Uncertain, Tedious Market Growth Customers unwilling to substitute for tried and true in their established products Nomex had to be used in developing products Plant operated below capacity Operational Problems Kevlar • Fast Market • Aerospace & Tire Market are willing to adopt Kevlar • The whole department seemed to have a consensus over Kevlar

• • •


Our view …
Yes, Kevlar should be implemented for the following reasons:
1. Kevlar is an improved product unlike Nomex 2. It has been already tested in the market with key customers as Tire manufacturers and aerospace manufacturers 3. The company has already invested so much in MDF I & II that it cannot be simply scrapped off 4. TFD department is a major contributor to the company’s earnings. Moreover, the X- Committee members are not unfamiliar with Kevlar

Ways to fund the project …
• Issue shares/ debentures • Stop manufacturing the problem children, use/sell (partly or completely) their manufacturing facilities and use this to fund the Kevlar project


• Never agree to all the ideas which come up in an organization, especially when it is consecutive • The financial implications of a project in terms of cash flow should be considered • The importance of market situational analysis before the launch of a product (absent in Nomex, present in Kevlar)


• The significance of testing the product before the launch of a product • Need for understanding the proper market needs (Shift from fiber B to fiber B1)

• Difficulty in convincing prospective customers to shift to our product by weaning away from their current products



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