Document wgKKrrJpY6eYQXzRVqvybbX44

CH-! REV. 7-0 UTMUMUMI E. 1. d u Po n t d e Ne mo u r s & Co mp a n y INCORPORATED Wil min g t o n , De l a w a r e 19898 CHEMICAUB AND PIGMENTS DEPARTMENT CC: J. P. GLAS G. C. TUNIS, JR. R. J. PAVLIN P. H. NORLING P. A. WRIEDE - JACKSON LAB. J. 6. ISHLKAWA July 28, 1983 DU PONT CONFIDENTIAL SPECIAL CONTROL R. G. HIRSCH 1984 TECHNOLOGY SUMMARY COLORED PIGMENTS Attached for your processing is a draft of our 1984 Technology Summary for Colored Pigments. R. S. WEIS RSW:ph Attachment N 26967 1984 TECHNOLOGY SUMMARY COLORED PIGMENTS BUSINESS MISSION Manage quinacridone in a strengthen mode and "Krolor" in a sustain mode, while managing remaining products in a harvest mode. Improve cash flow by reducing costs and maintain an assured supply of quality pigment to F(>FP. ROLE OF TECHNOLOGY Superior quinacridone process and product technology is the key factor in maintaining Du Pont's competitive leadership in quinacridones. The quinacridone segment is Du Pont's strength in Colored Pigments. EVALUATION Technology Position Opposite Competition 1983 1988 1993 Product Quinacridone + + + Inorganics ++ 0 Copper Phthalocyanlne 0 Other Organics 0 0 0 0 0 Process 00 0 Summary Superior products for automotive finishes and plastics. Conventional inorganics competitive in all areas. "Krolor" super ior for plastics applications. CPC blues are generally equal to competition. Competitive products for ink and consumer paints, but product line is narrower than competition's. Low oost producer of quinacridone crude. Some copper phthalocyanine and other organic processes are not cost competitive. N 26967.01 DUP050146175 TECHNOLOGY ASSESSMENT COMPETITIVE TECHNOLOGY POSITION PATENT POSITION Du Pont's current competitive advantage In the quinacridone business is a direct result of past strong patent position on process and product technology. Critical quinacridone patents on crude synthesis and solid solution products have expired in the last several years, allowing competition, especially Bayed, to introduce products that had been unique to Du Pont. Patent protection continues through the late 1980,'s on important treating agents and quin acridone gold products. No strong patent protection exists for other product lines with the exception of silica coated lead chromates ("Krolor") where product and process patent protection exists through the mid-80's. Competition is marketing "Krolor"type products, which we feel infringe our basic patents. KEY TECHNOLOGIES Quinacridone Crude Synthesis AMI M A Finishing Technology MO M A Product Properties AMO M LEGEND Life Cycle Business Impact E * Emerging EV - Evolving M Mature MA * Major PMA Potentially Major MO Moderate MI Minor Competitive Position ,, Major Present A Major Future Advantage Advantage Modest Present Advantage . Modest Future ^ Advantage DUP050146176 (Continued) TECHNOLOGY ASSESSMENT COMPETITIVE TECHNICAL ACTIVITY STATE OF THE ART Research in Colored Pigments at Du Pont and major competition is generally aimed at modifying and Improving existing products to meet the performance needs of changing end-use industries. European pigments manufacturers have also been successful in research aimed at developing completely new pigment chemical types (as judged by patent activity) especially in the yellow, orange, and red color areas, d u Pont currently does not have a major technical effort aimed at new pigment development. COMPETITOR.'S ACTIVITY DU PONT IMPACT o Bayer has developed a production unit (Bushey park, S.C.) utilizing Du Pont quinacridone synthesis technology to produce unique red products. o Du Pont production scale should continue to yield better economics. o Bayer and Sun are actively developing quinacridone solid solution products which had previously been unique to Du Pont. o Du Pont technical exper tise in.quinacridone product development and strong ties with F&FP will maintain our lead in new product development. CONCLUSION Du Pont's strength in Colored pigments resides in the quinac ridone segment of the business. Our large scale production facility based on intermediate synthesis of dlhydroqulnacridone and our backward integration to dimethylsuccinate (a Petro chemicals Department by-product) combine to make us the low cost producer of crude quinacridone. The requirement for high tem perature operation and sophisticated solvent recovery make it difficult for competitors to duplicate our economics without significant investment, Bayer has installed a production faci lity based on our technology to produce products formerly unique to Du Pont. Improved product introductions are key to maintaining a com petitive advantage. Our technical expertise in quinacridone product development and our close ties to the critical automotive industry through F&FP should allow us to continue our product superiority. Du Pont is generally equal to competition in product technology in non-qulnacridone segments of the business. However, our multiplant configuration and low capacity utilization result in process cost disadvantages in these segments vs. competition. DUP050146177 RESEARCH STRATEGY AND PROGRAMS STRATEGY Research emphasis will be placed on maintenance of our quinacridone competitive position through improved product development to respond to new automotive finishes technology and to expand quinacridone penetration into high value plastics markets. Development of improved products in non-quinacridone business segments will be minimized over the next several years. Manufacturing technical programs are aimed at upgrading existing product technology to improve operating reliability and product quality and reproducibility. Success in these programs will allow future operation of the Colored Pigments business in a more cost effective manner to improve profitability and competitive position. PROGRAMS Tactical Research 1983 1984 Expenditures Expenditures MP* MP* Develop new, im- 4.0 proved QA products to meet changing automotive end-use technology and main tain our competitive position. 1250 4.7 1220 o Develop new non-QA 2.5 product forms that improve value-in-use in critical paint and plastics applications. 810 1.7 o Improve operating 3.8 840 4.9 technology and facilities to reduce cost and allow more reliable operation of manu facturing processes. 550 920 incentive o 1.3MM lbs. new business during 1985-1988 result ing in a profit contribution of $18MM. o Protection of our QA competi tive position. o BOOM lbs. new business during 1985-1988 re sulting in a profit contribu tion of $1.2MM. o $1.4MM in 1984 cost reduction. o Allows operation of Colored Pig ments business at zero base levels. Direct manpower only. DUP050146178 RESEARCH STRATEGY AND PROGRAMS (1984) (Continued) KEY ISSUES o Can we be successful in process improvement program to achieve cost reduction goals of Colored Pigments business? o Will we successfully maintain our quinacridone competitive position through new product development programs. SUMMARY DATA 1983(E) Manpower* $MM R&D MT 17 2.9 9 1.6 Total 26 4.5 1984(F) Manpower* $MM 14 2.7 8 1.4 22 4.1 R&D S&T Total t S&T 2.7 4.2 2.3 3.5 "Direct plus allocated manpower without ESD personnel. RESEARCH OBJECTIVES (%) Co6t Reduction Existing Process New Process Capacity Existing Product Improvement New Products Regulation 1982(A) 17 - 72 11 1983(E) 29 71 * 1984(F) 34 66 DUP050146179 *- * o 00 -o 90 ff OO K* 3 O H C a to to x 6 < 90 z w n oD AA Xa o H* v& H* O (A (0 C 0) ft ft ft H 0 ft 0 ft ri 11 JO ft o 3 ft Z W ft a c* 03 *< ft x 6. c oe C H- c rt 3 o n* 01 o ft H tJ ft ft o (0 O n m- h * 3 a. 0 3 0 c 0 2 3 O 0 ft l"h ft (ft *3 (ft ft M o ftt 9 0D *0 fD ft (ft O o (ft cr < j. 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