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May 4, 2012

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German factory explosion causes global car part shortage

A fire in a chemical plant in Germany on 31 March barely made the headlines when it tragically killed two workers, but the world of motoring has begun to sit up and pay attention as a shortage of a vital chemical has set in.

Polyamide 12 (PA-12), made from cyclododecatriene (CDT) is an important chemical for the production of plastic parts used by the motoring industry, and it is estimated that Marl Chemical Park produced between a quarter and half of the world’s supply of this material.

The fire at the plant in Marl was caused by a huge explosion, which killed one man at the scene, while another succumbed later to his injuries.

PA-12 is used to produce the plastic that makes fuel and brake lines in cars, as well as being used in solar panels.

A range of alternatives are being rushed out by chemical suppliers in order to fill the void left by the shortage in PA-12, while manufacturers including General Motors, Volkswagen and Toyota have been holding crisis meetings to assess alternatives and the impact of the shortage.

However, analysts are unsure whether enough alternatives will be able to fill the gap left by the huge fire.

The owners of the plant, Evonik Industries have indicated that it will take at least three months to repair the factory, and chemical analyst Paul Blanchard said that it would take at least six months for the company to return to the capacity they were operating at before the explosion.

“The ability of Evonik and Arkema [an Evonik customer] to find alternate sources of CDT is very limited, and it is doubtful that the CDT shortage can be made up. In the short term, auto and truck production will be affected.”

It has not been revealed what caused the explosion which sent flames of up to 100m high, and a plume of black smoke across the Ruhr valley.

This disruption to the industry comes just over a year after widespread parts shortages were caused by the tsunami in Japan.

The Financial Times suggested that the disruption caused by this latest blast ‘highlights the negligible margin for error right now in the global automotive supply chain, which is running on lean inventories three years after the industry’s worst crisis in many decades.’

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