Kolon Plastics, an affiliate of South Korea’s Kolon Group, launched Kolon BASF innoPOM, a joint venture with German chemicals firm BASF, to make polyoxymethylene (POM) a plastic used in car parts, the company said Thursday.
Backed by the world’s biggest POM production capacity and growing demand in the auto industry, the joint venture is expected to bolster Kolon’s annual revenue by 80 billion won ($70.2 million).
Located in Gimcheon, North Gyeongsang Province, Kolon and BASF each invested 30 billion won in the plant that can produce 70,000 tons of POM annually.
Kolon BASF innoPOM built plant in Gimcheon, North Gyeongsang Province (Kolon)
When combining production of the existing POM factory, the Gimcheon facility marks the world’s biggest single POM facility with annual production of 150,000 metric tons, the company said.
An additional 260 billion won was invested in the plant after the firms broke ground on April 2016.
“The latest (joint venture) is an exemplary case of synergy in the global chemicals industry created by collaborating strengths of two firms. Kolon will engage in more partnerships across various businesses besides POM,” said Kim Yeong-bom, Kolon Plastics CEO and joint representative director of Kolon BASF innoPOM, in a press event for the factory’s completion at Kolon One&Only Tower in western Seoul.
POM is mainly used to produce auto parts such as fuel pumps, safety belts and electronics. Demand for POM has recently risen in the auto industry as carmakers compete to reduce the weight of eco-friendly vehicles, a key factor that impacts battery use and driving distance.
According to market researcher IHS Markit, demand for POM worldwide is expected to increase to about 1.6 million tons in 2023 from this year’s estimated 1.4 million tons.
The new plant will produce Kolon Plastic’s Kocetal and BASF’s Ultraform.
By Kim Bo-gyung (email@example.com