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By Florence Tan and Gavin Maguire
SINGAPORE, Feb 25 (Reuters) – Dow Inc is adjusting its carbon footprint and product slate to adapt to climate change and tap evolving consumption trends tied to the global energy transition, a senior executive said this week.
Dow has pledged to become carbon neutral by 2050 by boosting the use of renewable energy, such as wind power in the southern United States, and by improving energy efficiency at its petrochemical plants, Dow’s Asia Pacific President Jon Penrice told Reuters on Wednesday.
It is also developing products that help customers cut their own emissions such as sealants that improve heating efficiencies in buildings, materials to lighten electric vehicles and make batteries more efficient, he said.
“We actually see climate change as something that’s very likely to happen, high probability and high impact,” Penrice said.
“It’s going to be a big opportunity I think for many, many players in the petrochemical industry.”
Dow launched its MobilityScience platform last year aimed at tapping the “lightweighting” push among car manufacturers seeking to increase the range and lower the power needs of electric vehicles (EV).
“We have global sales today of 3 million (EVs), which is only 4% of the global market, but that’s growing extremely fast in Asia Pacific, mainly in China, but also around the rest of the world now,” Penrice said.
“You have to redesign everything from lighter weight materials, longer-range performance, battery materials, comfort and safety in the car, and overall a lower carbon footprint.”
Dow is collaborating with traditional original equipment manufacturers and EV startups in China, Penrice said.
Dow has also targeted the wind energy sector with materials that toughen wind turbine blades which are now four- to five-times longer than before, and using coatings to make them resistant to icing during winter, he added.
The company is also designing products geared towards a circular economy, such as single-layer food packaging that can be more easily recycled.
Dow, the third-largest petrochemical producer after BASF and Sinopec, saw strong sales of packaging and home care products last year, boosted by demand for cleaning and takeaway food during the pandemic lockdowns, Penrice said.
That lifted the company’s sales to $10.7 billion in the fourth quarter, 4.7% higher than the same quarter in 2019, although annual sales fell 10.5% from a year earlier to $38.5 billion in 2020.
China is expected to remain the main growth engine in Asia, but Japan, South Korea and some Southeast Asian markets could see double-digit increases in gross domestic product from a low base last year, Penrice said.
“We’ve seen a broader-based recovery now in markets related to things that were very weak last year, like automotive demand which has recovered,” he said, noting that China’s car sales have risen for six months in a row.
Home improvement products such as building coatings, sealants, appliances and furniture have also seen a “strong boom” as consumers spend disposable income, he said. (Reporting by Florence Tan and Gavin Maguire; Editing by Christian Schmollinger)