Fact Book Innovative Lightweight Design

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3 Fact Book Innovative Lightweight Design

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5 Agenda 1. LANXESS promotes Green Mobility 2. Why we need Green Mobility 3. Lightweight design helps enable Green Mobility 4. LANXESS makes lightweight design possible 5

6 LANXESS a global specialty chemicals player with focus on technology and innovation Specialty chemicals company Spun-off from Bayer in 2004, listed in the DAX* since 2012 Focus on: plastics, synthetic rubber, specialty chemicals, intermediates Global success story Roughly 17,100 employees in 31 countries 48 production sites worldwide 2011 sales of EUR 8.8 billion Strategy of targeted innovation Vital role in LANXESS growth Focus on process and product innovation 6 * German stock market index

7 LANXESS is Energizing Chemistry Premium quality Premium specialty chemicals company More than 5,000 products for a diverse range of applications High quality solutions enabling customers to successfully meet current and future challenges Technical expertise State-of-the-art materials, services and solutions that meet the most exacting standards Creating significant value for our customers, the environment and our company LANXESS global mission Commitment to sustainable development Creation of green solutions to meet the challenges of global megatrends Development of environmentally-friendly technologies, resource-efficient processes and next-generation products Sustainability Targeted innovation designed to meet customer needs Pragmatic corporate culture drives product, process and outside-the-box innovation Highly effective innovation network, combining global reach with local expertise Innovation 7

8 Solutions for global megatrends Mobility Agriculture Urbanization Water 8

9 Special focus on Green Mobility 9

10 Green Mobility solutions for global challenges can have a positive impact in four major areas Means of transport Energy Infrastructure / urban planning Information management systems 10

11 Six pillars of LANXESS contributions to Green Mobility all based on innovation and technology LANXESS Contribution Green Tires Lightweight Materials Sustainable Leather Management Technical Products Bio-Based Raw Materials Biofuels & Renewable Energy Innovation & Technology 11

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13 Agenda 1. LANXESS promotes Green Mobility 2. Why we need Green Mobility 3. Lightweight design helps enable Green Mobility 4. LANXESS makes lightweight design possible 13

14 Conventional mobility reaches its limits Key challenges Rising CO 2 emissions threaten the global climate and the environment - Without appropriate countermeasures, global CO 2 emissions will double by 2050 Increasing mobility demands are driven by population growth and a growing middle class, especially in BRIC* countries Finite resources such as fossil fuels will run out inevitably Consumer needs concerning mobility are changing The future of mobility must be green 14 Source: International Energy Agency * BRIC countries: Brazil, Russia, India, China

15 Drivers for Green Mobility Environmental challenges Urbanization Growing population and middle class Changing consumer demands Economic challenges Politics 15

16 Growing population and middle class inevitably result in even higher mobility Growing world population In 2050, the world population is expected to reach 9.3 billion people Growing middle class in BRIC In 2020, an additional 800 million people will achieve middle class status in BRIC countries* By 2050, all modes of mobility in emerging countries (including BRIC) will have experienced considerable growth** Cars / light-trucks: 5.7x increase Two-wheelers: 3.8x increase Rail: 3.0x increase Aircraft: 2.5x increase Bus: 1.3x increase Main challenge: enabling continuous but sustainable growth 16 Sources: OECD Transport Outlook 2012; UN Population Division * Income bracket of >US$ 6,000 and < US$ 30,000 per capita in BRIC countries ** Changes in passenger mobility compared to 2010

17 Increasing mobility aggravates environmental problems The situation today is critical CO 2 emissions and other greenhouse gases lead to climate change Mobility accounts for up to 30% of global energy consumption About 18% of global CO 2 emissions are related to mobility 75% of which is generated by road traffic* Alarming future development CO 2 emissions in emerging countries (including BRIC) will more than double ( ) Emissions in OECD**-countries will still grow by about 25% Global mobility-related CO 2 emissions are expected to grow by up to 2.4 times ( )*** Urgent need for emission reduction 17 Sources: OECD Transport Outlook 2012; Institut du développement durable et des relations internationals * Varying across countries ** Organisation for Economic Co-operation and Development: includes many of the world s most advanced countries (see all 34 member countries on *** Total CO 2 emissions from freight and passenger transport combined

18 Worldwide political initiatives to support a more sustainable mobility examplary initiatives to reduce CO 2 emissions USA aiming for a CO 2 reduction of 17% during the period * EU aiming for a 20% cut in greenhouse gas emissions during the period ** China aiming to reduce CO 2 emissions by 40-45% compared to economic growth during the period Japan promising a 25% cut in CO 2 emissions by 2020 if all major economies participate Brazil aiming to reduce greenhouse gas emissions by at least 36% below projected 2020 levels India seeking to reduce CO 2 emissions by 20-25% compared to economic growth during the period South Korea planning to reduce emissions by 30% below projected 2020 levels (4% below 2005 values) 18 Source: United Nations Framework Convention on Climate Change (UNFCCC) * Provided that the awaited law on climate control comes into effect as scheduled **As part of the EU Energy Efficiency Plan; for more information see

19 Worldwide political initiatives to support a more sustainable mobility further examples (1/2) Low emission zones in EU-countries and Japan 11 EU countries (e.g. Germany, United Kingdom, Italy, Sweden, Netherlands) and Japan (Tokyo) Low emission ZONE EU-wide CO 2 regulations Airline carbon tax: Since January 2012, all flights arriving at or leaving EU airports pay a fee* CO 2 -limit values for new vehicles: Carmakers have to substantially reduce the average CO 2 emissions of all vehicles by 2020** Development plan for electric mobility in Germany Goal: Strong e-mobility industry and over one million e-cars in 2020 Congestion charge in UK For vehicles within a specified zone between 7:00 am and 6:00 pm 19 * Exact amount to be paid depends on various factors; in general, fees are expected to rise in order to promote use of low-co 2 emission-airplanes ** Regulation (EC) No. 443/2009 of the European Parliament and of the Council of 23 April 2009 setting emission performance standards for new passenger cars:

20 Worldwide political initiatives to support a more sustainable mobility further examples (2/2) Carbon emissions-based vehicle plan in Singapore Starting in January 2013, buyers of low-carbon-emission cars (i.e., less than or equal to 160g CO 2 /km) qualify for rebates = $$$ Development plan for energy saving and new energy vehicles in China Government incentives aim for five million electric and hybrid vehicles by 2020 Fuel economy regulations in the USA New fuel economy standard of 4.3 l/100km for cars and light trucks by 2025* Bike sharing in cities In 300 cities worldwide (e.g. Barcelona, Hangzhou, New York, Rio) Promoting bicycling is one of the easiest ways to curb carbon emissions and reduce traffic congestion 20 * Since 2011, the Corporate Average Fuel Economy (CAFE) measures the target values on the basis of the vehicle s footprint (product of wheelbase and track dimensions); the consumption of cars is supposed to go down by 5% (3.5% for light trucks)

21 EU road traffic is a key component in initiatives to reduce CO 2 : the obligation is on carmakers Objectives of regulation Carmakers have to substantially reduce the average CO 2 emissions of all vehicles by 2020 Manufacturers incur annual fines of up to EUR 95 per year for every gram above the target value (see diagram on the right) What this means for OEMs The values are calculated based on the weight of the vehicle: this can result in different threshold values depending on the OEM s portfolio* OEMs need to find viable combinations of different solutions to reduce CO 2 in order to comply with the guidelines as efficiently as possible Exceeding the target values can be expensive 140 g 95 g 75 g CO 2 output Average CO 2 output per kilometer of all cars sold across Europe by year European fleet average g 710 Target % Target 2020 Possible target 2025 Potential fines** EUR per vehicle in fleet 0 4,035 12,350 ** As compared to the current average CO 2 output in Europe of 140 g per kilometer per car. Innovative approaches are essential in view of the new requirements Ruling from 2015: EUR 5 for the 1st gram, EUR 15 for the 2nd gram, EUR 25 for the 3rd gram, and EUR 95 for the 4th gram and each additional gram Ruling from 2030: EUR 190 per gram 21 Sources: McKinsey; Regulation (EC) No. 443/2009 of the European Parliament and of the Council of 23 April 2009 setting emission performance standards for new passenger cars: * The threshold values for premium manufacturers are higher as luxury vehicles are heavier on average

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23 Agenda 1. LANXESS promotes Green Mobility 2. Why we need Green Mobility 3. Lightweight design helps enable Green Mobility 4. LANXESS makes lightweight design possible 23

24 Environmentally friendly means of transport make an important contribution to Green Mobility Means of transport Infrastructure / urban planning Energy Information management systems The future belongs to modern forms of transport offering improved energy efficiency and minimal CO 2 emissions, e.g. due to - Green Tires - Innovative drivetrains - Aerodynamic improvements - Electronic assistance systems - Lightweight design 24

25 Especially cars have the potential to be significantly improved Cars have the highest operating costs of all means of transport Negative environmental impact of cars due to - High CO 2 emissions per person transported - Relatively short distance driven per 1 ton CO 2 emission ** Operating cost per 100 km* EUR EUR EUR 9.90 EUR 8.60 Average CO 2 emissions per person 380 g/km 150 g/km Industry must find ways to make cars greener ** 40 g/km 20 g/km 25 Source: Green Mobility Maßnahmen zur Verringerung von CO 2 -Emmissionen im Vergleich (Green mobility a comparison of measures for reducing CO 2 emissions) by Prof. Dr. Horst Wildemann, Munich Technical University * Figures assume that long-distance buses and trains run at 44% average capacity; airplanes at 73% capacity, and cars carry 1.5 persons; operating costs for a car carrying 3 persons equal EUR ** Long-distance buses

26 The requirements for modern cars are expanding and with them, vehicle weight There are 900 million cars across the world a number that is set to more than double by 2050 The result is that cars need to become both more economical and more ecological Additionally, customer requirements are on the rise: - Higher safety standards (e.g. ABS, Airbags, reinforced car body structure) - Greater comfort and quality (e.g. airconditioning, audoio, satnav, and parking systems) - High-quality design The consequence is a trend towards greater weight The car is changing as requirements expand Reliability Affordability Safety Fuel consumption Factors behind the increase in weight Sustainability Connectivity?????? Over the last 40 years cars have continuously got heavier Legislation Safety Interior 25% 30% 15% 22% 8% Example: Mini Cooper Comfort Quality 26 Sources: Valeo; Klimacampus; Automotive Now (1/2011) - KPMG International; VW; BMW

27 New drive concepts also adversely affect a car s weight Emission-reduction measures based on innovative drive systems increase weight In the long run alternative energy sources will replace fossil fuels for car engines??? Electric vehicle Range extender Electric vehicle with an internal combustion engine to charge the battery The result: increased system costs*, impaired handling, and reduced range Alternative drive systems need to be compensated for cars must be made lighter Optimized combustion engine Partial hybrid Full hybrid Plug-in hybrid Electric jump start, electric driving at a low speed Start-stop systems, regenerative brakes Full hybrid with a large battery and plug-in capability 27 Sources: Lightweight, heavy impact by McKinsey, Elektromobilität Anforderungen an Reifen, Fahrwerk, Antrieb und Marktpotenziale (Electric vehicles demands on tyres, chassis, drive, and market potential) by Prof. Dr. Horst Wildemann, Munich Technical University * Because, among other things, batteries and brake/insulation systems need to be larger

28 Lightweight design a key technology for sustainable mobility Lighter cars increase fuel efficiency, reduce CO 2 emissions in road traffic, thereby contributing to Greener Mobility Increasing demands for comfort and safety cause the weight to spiral upwards lightweight design ensures that cars remain economical Lightweight design compensates for the negative consequences of new drive concepts (e.g. battery in electric cars) without lightweight design modern mobility is unthinkable 28

29 Even a savings of 100 kg enables enormous emission reductions Driving resistance considerably influences vehicles fuel consumption and CO 2 emissions - The higher the resistance, the more energy is required to move the vehicle Rolling, gradient, and acceleration resistances are highly dependent on the vehicle weight and are thus directly influenced by lightweight design Lightweight design is therefore suitable as an effective means of reducing CO 2 emissions and fuel consumption Mass is a key factor in determining the resistances that act on a vehicle lightweight design is the logical solution Acceleration resistance mass x acceleration of the vehicle Rolling resistance (mass x gravity) x rolling friction * c w value: air-resistance coefficient Air resistance (air density/2) x c w * x vehicle surface x speed 2 Gradient resistance (mass x gravity) x (gradient height/gradient length) Rule of thumb: 100 kg less weight means savings of 0.5 l fuel per 100 km and g less CO 2 per kilometer travelled** 29 Source: Green Mobility Maßnahmen zur Verringerung von CO 2 -Emmissionen im Vergleich (Green mobility a comparison of measures for reducing CO 2 emissions) by Prof. Dr. Horst Wildemann, Munich Technical University ** Based on a car weighing 1,400 kg and an average consumption of 8 l of conventional fuel per 100 km, which corresponds to an output of 2.33 kg of CO 2 per liter (basis of comparison: car with a life cycle of 120,000 km in six years)

30 Lightweight design is an effective way to optimize e-mobility concepts Lightweight design increases the range of electric cars The drivetrain of a battery-driven electric car is considerably heavier than the drivetrain of a car with an internal combustion engine Weight is the key factor for e-cars range To increase the range you can either use bigger, more expensive batteries or reduce the vehicle weight The use of lightweight design compensates for battery weight and thereby increases the range Even at costs of up to EUR per kg* lightweight solutions are still more cost-effective than larger batteries Lightweight design plays a central role in the widespread use of e-mobility Battery range required by consumers in Germany in 2009 (in km) The average range is currently just 135 km 30 Source: Elektromobilität Anforderungen an Reifen, Fahrwerk, Antrieb und Marktpotenziale (Electric vehicles demands on tires, chassis, drive, and market potential) by Prof. Dr. Horst Wildemann, Munich Technical University * Based on the battery price in 2011

31 Vehicle weight can be reduced in various ways Areas where lightweight design can be applied: (Share of weight of the vehicle components in %) Lightweight construction methods and lightweight materials can significantly reduce vehicle weight and thus the driving resistance* Interior Electronics Car body Lightweight design Drivetrain Chassis Lightweight construction methods Lightweight materials 31 * Weight savings can also be made by omitting components or downsizing. However, such measures are often not in line with customer expectations and may result in marketing challenges

32 Lightweight construction methods comprehensive lightweight construction of all vehicle parts Less weight through a combination of lightweight components and innovative concepts For example, various technologies have been developed in the area of the car body: - Multi-material construction: the optimal material is used for each part - Hybrid construction: usually a combination of steel and aluminum - Spaceframe construction: use of extruded metal sections that enclose the passenger compartment However, it is only possible to reduce weight substantially if lightweight construction methods are used throughout the car Successful lightweight construction uses new technologies through the whole car 32 Source: Green Mobility - Maßnahmen zur Verringerung von CO 2 -Emmissionen im Vergleich (Green mobility a comparison of measures for reducing CO 2 emissions) by Prof. Dr. Horst Wildemann, Munich Technical University

33 Saving weight through smart material combinations, such as plastic/metal hybrid technology Plastic/metal hybrid technology* permits more functions to be integrated into car parts Combining the properties of both materials creates a higher performance than either can achieve separately - Metals such as steel and aluminum provide high strength and stiffness - High-tech plastics such as glass-fiber-reinforced polyamide improve the components properties and allow a reduction in wall thicknesses Significant benefits (in comparison with 100% steel components) Weight reduction of up to 50% High functional integration in the injection molding process reduces the number of process steps, enabling costs to be cut by up to 40% Greater precision, quality, and strength Already successfully applied in practice numerous times Hybrid technology is used in many car components Pedal system Front end Roof frame Structural inserts 33 * Hybrid technology developed by LANXESS

34 Design with lightweight materials lighter materials that satisfy all requirements Choosing lighter materials aims to reduce the weight of the car Depending on where it is used, the requirements for a vehicle component and thus the material it is made of vary greatly - For example, materials in the engine compartment must be particularly heatstable In the interior, aesthetic considerations are relevant as well as weight The right material needs to be used for the right application 34

35 Overview of important lightweight materials metals (1/2) Material Description Fields of application High-profile examples High-strength steel (HSS) Steel varieties that are stronger than regular steel The same requirements can be met with less material Components that require strength and plasticity, e.g. side impact bars The Golf VII from VW is lighter than its predecessors; the bodywork in particular is almost 9% lighter due to HSS Large parts of the bodywork of the Audi Q5 are made of (ultra-)high-strength steels Aluminum Used extensively in aerospace The material is also becoming more relevant in vehicle manufacturing Despite having a lower density than steel, aluminum exhibits good stiffness Structural and functional components, e.g. sub-frame or axle carrier Die-cast casings, e.g. engine blocks or gearbox housings The bodywork of the Mercedes SL and other chassis parts largely consist of aluminum In the BMW i3 the bodywork base is an aluminum spaceframe which houses the battery and the drive unit in the rear Magnesium The lightest metal that can be used on a large scale offers great potential for weight saving Gaining significance through alloys with improved material properties and as a matrix material in composites Parts in the interior, e.g. cross - car beams, steering wheel rims and seat frames Die-cast casings Even in the 1930s, the VW Beetle had a magnesium gearbox and engine block Today the material is experiencing a revival in gearbox housings at Audi and Mercedes-Benz 35 Sources: McKinsey; EMPA Thun; F. Schröter: Höherfeste Stähle für dem Stahlbau Auswahl und Anwendung (Higher-strength steels for steel construction selection and application) (Bauingenieur 9/2003); ATZonline; AutomobilIndustrie NB: All information on the various lightweight materials (pages 35-38) is based on data from the beginning of 2012

36 Overview of important lightweight materials metals (2/2) Material Part weight* (compared to steel) Part costs* (compared to steel) ** Current use by vehicle class Summary High-strength steel (HSS) 80% Mainly for small/mediumsized cars with conventional or hybrid drivetrains The benefits of high strength and stiffness are counterbalanced by constraints on design freedom Due to the good performance, HSS will become an important factor in serial production Aluminum Mainly for luxury medium-sized cars, the premium class, and electric cars The costs are higher than for steel due to the more energy- and technologyintensive production process The use of aluminum in medium-sized cars, however, will increase Magnesium Mainly for luxury medium-sized cars, the premium class, and electric cars Production costs are currently still very high due to the high labor input involved (including increased safety requirements due to the risk of fire) Magnesium is also increasingly being used in medium-sized cars 36 Source: McKinsey; emobility tec * The comparison of piece weight and costs for the materials depends on the application and thus difficult to forecast; the data is based on expert assessments ** Assuming 60,000 parts produced per year Meaning of the symbols from left to right: small car, medium-sized car, premium class, electric car, luxury car, racing car

37 Overview of important lightweight materials innovative plastics and composite materials (1/2) Material Description Fields of application High-profile examples Plastic Plastics are subdivided into thermoplastics and thermosets, which have different properties Plastics can be reinforced, for example with short glass fibers External and internal parts as well as engine compartment components that require a medium level of strength, e.g. housing parts, covers, brackets, pedals The gearbox oil pan of the Audi R8 is made of a short glass-fiber-reinforced thermoplastic The Audi A8 has a plastic spare wheel well that is glued into the aluminum bodywork Glass-fiber-reinforced plastic (GRP) Fiber-plastic composite material in which continuous glass fibers are embedded in a plastic matrix The selection of the matrix material (thermoplastic or thermoset) considerably influences material properties* Components that require a high level of strength, e.g. hoods and flaps, front ends, seat structures, airbag housings Widespread use is made of GRP in premium cars, e.g. the trunk lid on the Mercedes CL Instead of aluminum, Audi uses GRP in the lower beam of the front end of its A8 Carbon-fiber-reinforced plastic (CRP) Fiber-plastic composite material in which continuous carbon fibers are embedded in a plastic matrix The carbon fibers are baked at 1,300 C after which they have a 40 times higher tensile strength than steel Components that require a high level of strength and stiffness, e.g. vehicle frames, engine covers, or tail gates BMW is planning to use CRP in the serial production of its i3 and i8 electric car models The monocoque bodywork of the Lamborghini Aventador is largely made of CRP 37 Sources: McKinsey; EMPA Thun, AVK Industrievereinigung Verstärkte Kunststoffe e.v.; ATZonline; Toho-Tenax * GRPs with thermosets cannot be reshaped after the matrix has solidified, but they can withstand high temperatures; GRPs with thermoplastics soften at high temperatures, but can be more easily formed and shaped; in contrast to thermosets they can be more easily recycled

38 Overview of important lightweight materials innovative plastics and composite materials (2/2) Material Part weight* (compared to steel) Part costs* (compared to steel) ** Current use by vehicle class Summary Plastic Plastics are used in all vehicle classes The strength of plastics can be increased by a combination with other materials or by adding short fibers Due to their suitability for a wide range of applications and their good performance, the use of plastics in automotive production will continue to increase Glass-fiber-reinforced plastic (GRP) * Used in the premium class, the luxury segment, electric vehicles, and motor racing With thermoplastics as the matrix material, GRPs are already suitable for mass production and also easier to recycle than thermosets GRPs will play an important part in serial production in the long run Carbon-fiber-reinforced plastic (CRP) Used in the luxury segment, electric vehicles, and motor racing CRP is still very expensive to manufacture due to scalability challenges and high energy requirements in production In the near future, the use of CRP will be limited to special models and e- vehicles in limited numbers 38 Source: McKinsey; emobility tec; Toho-Tenax */** See explanations on page 35 *** The estimate refers to GRP with thermoplastic as the matrix material; higher costs are anticipated for thermosets Meaning of the symbols from left to right: small car, medium-sized car, premium class, electric car, luxury car, racing car

39 Existing technologies and materials offer ideal preconditions for the promotion of lightweight materials Thermosetting fiber-reinforced materials have high weight-saving potential; however, CRP components in particular are still expensive There are new opportunities in the area of continuous-fiber-reinforced thermoplastic materials - Manufacturing costs and processes are already suitable for mass production today OEMs, suppliers and material manufacturers need to work closely together to enable rapid utilization of this class of materials All industry players must work together to develop lightweight design further Need for action: EU target values are not yet being met (OEMs CO 2 emissions in g per km in 2011) 130 g (target 2012) Manufacturers are using various materials to make lighter, eco-friendlier cars Material Weight savings in % High-strength steel Aluminum Magnesium Plastic GRP CRP 20% 30% 40% 20% 35% 50% 95 g (target 2020) Serial production capability ( ) 39 Source: Boston Consulting Group; McKinsey

40 New players Traditional players Aftermarket Important for lightweight design in serial production: everyone involved needs to move in closer step Financial service providers Suppliers + Cooperation + Networkability OEMs Dealers Manufacture of Tier 1: vehicle modules/systems Tier 2: vehicle parts Tier 3: vehicle parts and raw materials Design, manufacture, assembly Brand management Financing Car rental and fleets New component suppliers (e.g. components for lightweight design) Manufacturers of information systems Tier 0.5 suppliers* and new OEMs Mobility service providers Shift in value creation structures: suppliers will play an increasingly important role in the future 40 Source: KPMG s Global Automotive Executive Survey 2012 * Suppliers that manufacture complex modules or in some cases complete vehicles

41 The market for lightweight materials is growing dynamically outlook The lightweight design trend increases the production volume of lightweight materials in the car industry The use of lightweight materials is growing fastest in the car industry +13% +1% +17% Volume (in millions of tons) CAGR for car industry Change in lightweight share** (percentage share of the overall material mix) (annual production volumes in millions of tons and annual growth rate in %) Aviation Wind % The market for lightweight components will grow from roughly EUR 70 billion to more than EUR 300 billion in 2030*** Auto PP The significance of lightweight materials is growing for all market players Market volume (in EUR billion) % (CAGR) 41 Source: McKinsey; Financial Times Deutschland: Kunststoff im Autobau (Plastic in car manufacturing) * A similar trend is forecast for GRP (no data is available for this) ** High-strength steels, aluminum, magnesium, plastic (above and beyond current use), CRP, GRP *** Forecast is dependent on the development of raw material prices

42 Use of lightweight design in other transport sectors further potential (sidebar) Aviation In aviation, lightweight materials already account for more than 80% of all materials used - Increased usage is anticipated in particular for CRP and high-strength steel Trains GRP and CRP are well established as materials for the interior and exterior body panel on trains as they enable the manufacture of elegant designs Ships Using GRP can considerably reduce fuel consumption in comparison with aluminum ships Trucks Traditional trucks* have an empty weight of around 13 tons tons can be saved with CRP 42 Sources: McKinsey; Dr. Bittmann: Leichtbau Zug um Zug (Lightweight construction step by step), in Kunststoffe 10/2004; Hacotech; Focus magazine * EU tractor unit (40 t)

43 Agenda 1. LANXESS promotes Green Mobility 2. Why we need Green Mobility 3. Lightweight design helps enable Green Mobility 4. LANXESS makes lightweight design possible 43

44 Innovative lightweight design energized by LANXESS LANXESS materials and technologies for innovative lightweight design Make vehicles lighter and offer a high level of design freedom Increase fuel efficiency and reduce CO 2 emissions Our products, technologies and innovations enable us and our customers to create solutions for contemporary and sustainable mobility 44

45 LANXESS is committed to products for lightweight applications especially high-tech plastics and composites Research and development Focus on product innovations in the area of high-tech plastics and composites that enable our customers to develop lightweight solutions to meet the challenges of growing mobility Production sites Between 2012 and 2014, EUR 125 million has been earmarked for investments in expanding the global production network for high-tech plastics E.g. new world-scale plant for polyamide plastics in Antwerp Technical support Our experts in the High Performance Materials (HPM) BU support our customers by providing state-of-the-art solutions that contribute substantially to the customer s success 45

46 LANXESS develops and manufactures its products for lightweight solutions via a global network Pittsburgh, US Gastonia, US Orange, US Leverkusen, DE Krefeld-Uerdingen, DE Antwerp, BE Dormagen, DE Hamm-Uentrop, DE Brilon, DE Filago, IT Wuxi, CN Hong Kong, CN São Paulo, BR Porto Feliz, BR Jhagadia, IN Mumbai, IN High-tech plastics Global compounding network Site for upstream-integration R&D center Other lightweight materials X-Lite technology for lightweight leather Therban high-performance rubber 46

47 Our customers benefit from an efficient value chain We combine high security of supply with technical expertise Raw materials HPM intermediates High-tech plastics/composites Engineering know-how Cyclohexane Sulfur Ammonia Cyclohexanone KA oil Oleum Sulfur dioxide Hydroxylamine Caprolactam* Glass fibers Compounding Polymerization Polyamide (PA)-based high-tech plastics TEPEX Polybutyleneterephthalate (PBT)-based high-tech plastics Continuous-fiber-reinforced thermoplastic high-performance composites Excellent product and application development Upstream-integration** is the key to quality 47 * Caprolactam is the starting material for the polymerization of polyamide 6 ** Upstream-integration: mergers or partnerships with companies from upstream stages in the economic process to achieve efficiency gains

48 With its expertise in high-tech plastics, LANXESS is leading the market LANXESS high-tech plastics are the ideal substitute for metal Compared to steel or aluminum, the polymers Durethan and Pocan offer lower density and thus lighter design Further benefits - New options in terms of design - Combination options with other materials for tailor-made solutions (e.g. hybrid technology) - Resistance to chemicals, aggressive bio-fuels, corrosion, etc. - Cost reduction due to efficient processing techniques The proportion of plastics in modern cars is already around 15%, and this trend is on the rise, thanks to innovative material combinations Whether alone or in combination with metal plastics from LANXESS are the ideal material for lightweight solutions 48

49 LANXESS offers innovative technologies Tepex hybrid technology for even lighter cars LANXESS is revolutionizing hybrid technology with Tepex composite sheets for structural components* Tepex composite sheets are continuous-fiber-reinforced materials with a thermoplastic polymer matrix The plastic/plastic hybrid technology combines Tepex with Durethan injection molding Various tailor-made LANXESS plastics, fiber materials and injection molding compounds can be used depending on the component requirements The hybrid components are an excellent alternative to steel or aluminum components - Lower density enables weight savings of up to 50% - High strength and stiffness ensure greater safety - Economical to manufacture and already in serial production TEPEX 49 * Used in the lower beam of the Audi A8 and the bumpers of the BMW M3 Bottom image: Audi A8 front end

50 Our bundled engineering knowledge enables tailored lightweight solutions LANXESS has comprehensive specialist knowledge for all phases of modern component development LANXESS: excellence in engineering The development of high-end applications requires specialized knowledge and the dedication of all players The outstanding engineering expertise of LANXESS enables innovative lightweight solutions that are characterized by both low weight and high performance Expert services along the entire customer value chain - Material Development - Computer Aided Engineering - Concept Development - Part Testing - Processing 50

51 Many car components can be made lighter thanks to products from LANXESS Car structure Components featuring LANXESS contribution Cross car beam Car body Roof frame Front end Spare wheel well Structural insert Engine oil pan Gas tank liner Gearbox oil pan Drivetrain Cylinder head cover Transmission belt Bracket Lightweight leather Interior Airbag housing Seat structures Pedal system Steering rod Chassis 51

52 How solutions from LANXESS help reduce weight car body examples (1/2) Car body Drivetrain Interior Chassis Roof frames using plastic/metal hybrid technology Compared to a steel solution, the component is 30% lighter and costs the same Front ends using hybrid technology Plastic/metal hybrid technology front ends are around 10-40% lighter than full metal front ends; the weight of hybrid aluminum front ends can be further reduced with Tepex inserts Roof frame Hybrid front ends made from plastic and metal are already widely used; as plastic bonds well with Tepex, the weight can be reduced even further* Front end 52 * The lower beam of the current Audi A8 front end that is already in serial production contains a Tepex U-profile

53 How solutions from LANXESS help reduce weight car body examples (2/2) Car body Drivetrain Interior Chassis Structural inserts Injection-molded inserts made from glass-fiber-reinforced PA6 enable substantial weight reduction and increased passenger protection Spare wheel wells made from 60% glass-fiber-reinforced plastic The component is glued directly to the bare bodywork and not only carries the spare wheel and on-board tools, but also stiffens the rear part of the vehicle Cross-car beams Cross-car beams with plastic/metal hybrid construction provide substantial benefits, enabling cable and air ducts or brackets for the steering column to be easily integrated, for example Spare wheel well: front view Structural insert Rear view Cross-car beam 53

54 How solutions from LANXESS help reduce weight drivetrain examples (1/2) Car body Drivetrain Interior Chassis Car gas tank with a liner made from PA6 High-pressure containers can be produced much more easily and cost-effectively using plastic With a coating made from continuous-fiber-reinforced plastic, they are up to 75% lighter than all-steel tanks with the same loading capability High-performance rubber for transmission belts In comparison to conventional chain drives, rubber belts are not only lighter, but they increase engine life and fuel efficiency* Cylinder head covers made from glass-fiber-reinforced plastic LANXESS Durethan is a popular choice for this application thanks to its high temperature resistance and favorable surface qualities Gas tank liner Transmission belt Cylinder head covers 54 * Up to 1 liter of fuel is saved per 100 km

55 How solutions from LANXESS help reduce weight drivetrain examples (2/2) Car body Drivetrain Interior Chassis Car engine oil pans made from polyamide 66 for turbocharged engines The engine oil pan made from polyamide 66 weighs about a kilogram less than a steel component solution; it is about 50% lighter than an aluminum version Gearbox oil pans made from highly glass-fiber-reinforced polyamide 6 Engine oil pan The high-tech material s stiffness enables a very shallow design for the oil pan, making it even lighter Gearbox oil pan 55

56 How solutions from LANXESS help reduce weight interior examples (1/2) Car body Drivetrain Interior Chassis Tepex housings for passenger airbags The thickness of the side walls can be reduced from 3-4 mm to mm by using Tepex hybrid technology without compromising on stiffness or strength This results in a casing that is 30% lighter than designs made from injection-molded thermoplastics Car brake pedals using Tepex hybrid technology* The world s first polyamide brake pedal reinforced with continuous glass fibers and designed for mass production It is roughly 50% lighter than comparable traditional steel brake pedals, but just as mechanically strong 794 g: Steel 526 g: Plastic/metal hybrid technology Airbag housing: rear view The evolution of the brake pedal 355 g: Tepex hybrid technology 56 * Plastic/plastic hybrid technology.

57 How solutions from LANXESS help reduce weight interior examples (2/2) Car body Drivetrain Interior Chassis Lighter leather LANXESS products accompany all stages of leather manufacturing. The innovative X-Lite process enables high-quality leather to be produced that is up to 20% lighter Leather for car seats Plastic seat structures In comparison to seat structures made from plastic alone, Tepex inlays can reduce the weight of car seat components by up to 50% Plastic seat shells 57

58 How solutions from LANXESS help reduce weight chassis examples Car body Drivetrain Interior Chassis Steering rods In contrast to metal, the use of high-tech plastics for structural components of the chassis, such as the steering rod, offers many benefits - Weight savings - Cost-effectiveness through efficient manufacturing and assembly processes - Reliable when subject to high dynamic mechanical stresses Steering rod 58

59 LANXESS major products for innovative lightweight solutions LANXESS Contribution Green Tires Lightweight Materials Sustainable Leather Management Technical Products Bio-Based Raw Materials Biofuels & Renewable Energy TEPEX Innovation & Technology 59 * Although primarily offering other green benefits, the use of X-Lite and Therban also enables weight savings

60 Durethan polyamide (PA)-based high-tech plastics Application Automotive (e.g. front ends, connectors, intake manifolds, door handles) Trains and airplanes Characteristics Reduces vehicle weight and improves performance Hybrid technology: Durethan reduces weight of certain structural components by up to 50% (compared to metal) Design freedom Green Tires Lightweight Materials LANXESS Contribution Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Innovation & Technology Green aspect Weight reduction directly leads to increased fuel efficiency and reduction of CO 2 emissions Does not require finishing, generates little waste, involves short cycle times and can also be used without coating Short description High-tech plastics such as Durethan make cars lighter by replacing metal parts contributing directly to lower fuel consumption and thus lower CO 2 emissions. They are corrosion resistant and new design freedom can be realized in combination with a higher degree of functionality. 60 Note: Durethan is a product of the BU HPM

61 Pocan polybutylene terephthalate (PBT)-based high-tech plastics Application Automotive (e.g. connectors, housings, electro motor housings) Trains and airplanes Characteristics Lightweight alternative to metal parts in the automotive industry Economic production process for car body applications Design freedom Green Tires Lightweight Materials LANXESS Contribution Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Innovation & Technology Green aspect Weight reduction directly leads to increased fuel efficiency and reduction of CO 2 emissions Does not require finishing, generates little waste, involves short cycle times and can also be used without coating Short description High-tech plastics like Pocan make cars lighter by replacing metal parts contributing directly to lower fuel consumption and thus lower CO 2 emissions. They are corrosion resistant and new design options can be realized in combination with a higher degree of functionality. 61 Note: Pocan is a product of the BU HPM

62 Tepex continuous-fiber-reinforced thermoplastic composite sheets Application Automotive (e.g. front ends, seat structures, pedals) Trains and airplanes TEPEX Characteristics Tailored thermoplastic composite sheets (Tepex ) for lightweight applications Tepex reduces weight by up to 50% (compared to metal) Green Tires Lightweight Materials LANXESS Contribution Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Innovation & Technology Green aspect Weight reduction leads to increased fuel efficiency and reduction of CO 2 emissions Resource efficient and recyclable Short description Thermoplastic composite sheets (Tepex ) have excellent mechanical properties due to their reinforcement with glas-, carbon or aramid fibers and in combination with their low density they offer great potential for lightweight design. Additionally, composite sheets are suitable for volume production, guarantee resource efficient processing and are easy to recycle. 62 Note: Tepex is a product of the BU HPM

63 HiAnt excellent product and application development Application Automotive (service brand standing for the high-end engineering knowhow for all stages of advanced component development) Characteristics Engineering know-how at the highest service level: Material Development, Computer Aided Engineering, Concept Development, Part Testing, Processing Smart solutions energized by LANXESS due to optimum use of material potentials (e.g. with hybrid technology) Green Tires Lightweight Materials LANXESS Contribution Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Innovation & Technology Green aspect Efficient application of high performance materials for optimal lightweight structures Result: increased fuel efficiency and reduction of CO 2 emissions; contribution to e-mobility Short description The development of high-end applications requires specialized expertise and special efforts from all development partners. HiAnt stands for outstanding engineering know-how for all stages of advanced component development resulting e.g. in innovative composite systems that are, at the same time, lightweight and strong. 63 Note: HiAnt is a product of the BU HPM

64 Further products for innovative lightweight design Maleic Anhydride (MSA) (BU Advanced Industrial Intermediates) Pre-product for surfaces of transport vehicles like trains or airplanes Maleic anhydride enables lightweight design and decreased surface resistance, resulting in positive environmental effects with regard to fuel consumption and CO 2 emissions Maleic Anhydride TP LXS TP LXS LANXESS Contribution Green Tires Lightweight Materials Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Mesamoll (BU Functional Chemicals) Plasticizer for polyurethanes, PVC and rubber, that are used for the automotive industry The phthalate-free plasticizer Mesamoll provides plastics with high elasticity and flexibility. In addition, it optimizes the processing properties of polymer materials which leads to improved product quality Innovation & Technology TP LXS TP LXS (BU Functional Chemicals) Bonding agents for tarpaulins of trucks The phthalate and solvent free bonding agents TP LXS / enable the bonding of flexible PVC coatings on polyester and polyamide fabrics 64

65 X-Lite technology for the manufacturing of lightweight leather Application Seats in cars, airplanes and trains Characteristics Lightweight upholstery leather products Green Tires Lightweight Materials LANXESS Contribution Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Innovation & Technology Green aspect Weight reduction directly leads to increased fuel efficiency and reduction of CO 2 emissions of cars, planes and trains Short description X-Lite enables the production of durable leather with a full and soft handle, attractive appearance and an up to 20% lighter weight compared to conventionally produced leather of equivalent thickness. This weight reduction effect in automobiles or aircrafts leads to improved fuel consumption. 65 Note: X-Lite is a product of the BU Leather

66 Therban hydrated nitrile rubber Application Automotive (timing belts) Railway (railway cables) Aerospace Characteristics High-performance elastomer with exceptional oil- and temperature resistance Light alternative to chains (e.g. driving belts, timing belts) Green Tires Lightweight Materials LANXESS Contribution Sustainable Leather Management Technical Products Bio-based Raw Materials Biofuels & Renewable Energy Innovation & Technology Green aspect Weight reduction and better transmission efficiency directly lead to increased fuel efficiency and reduction of CO 2 emissions Increased durability resource efficiency Short description With its excellent properties (resistant against heat and oil, excellent mechanical behavior), Therban (HNBR) is for example used for timing belts in automotive valve trains. Due to their low weight and their efficiency, they are a sustainable alternative to metal chain drives. 66 Note: Therban is a product of the BU High Performance Elastomers

67 LANXESS enables lightweight solutions for sustainable mobility To ensure sustainable mobility, carmakers will need to considerably reduce their cars energy consumption and CO 2 emissions in the future Lightweight design plays a key role in this process, as it increases fuel efficiency, reduces CO 2 emissions and compensates for the increase in weight associated with new drivetrain technologies With its innovative materials and its expertise in lightweight design, LANXESS is helping the automotive industry replace metal in cars with lighter components lightweight design energized by LANXESS 67

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71 Safe harbour statement This presentation contains certain forward-looking statements, including assumptions, opinions and views of the company or cited from third party sources. Various known and unknown risks, uncertainties and other factors could cause the actual results, financial position, development or performance of the company to differ materially from the estimations expressed or implied herein. The company does not guarantee that the assumptions underlying such forward looking statements are free from errors nor do they accept any responsibility for the future accuracy of the opinions expressed in this presentation or the actual occurrence of the forecasted developments. No representation or warranty (express or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and, accordingly, none of the company or any of its parent or subsidiary undertakings or any of such person s officers, directors or employees accepts any liability whatsoever arising directly or indirectly from the use of this document.

72 MASTHEAD As of March 2013 LANXESS AG Leverkusen Germany Phone