Automakers agree to fast-track resin substitutes

AP News
Posted: Apr 23, 2012 10:52 PM
Automakers agree to fast-track resin substitutes

Six major automakers and 19 suppliers are close to agreeing on a fast-track process for testing replacements for a resin that's in dangerously short supply.

The resin, PA-12, is used for fuel and brake lines, among other products. It has been in tight supply since an explosion last month at a German factory that provides 40 to 50 percent of the world's supply of PA-12. Lengthy shortages could force automakers to stop production in the next few weeks or months.

The Automotive Industry Action Group, a nonprofit trade group, said Monday that General Motors Co., Ford Motor Co., Chrysler Group, Honda Motor Co., Hyundai-Kia and Volkswagen AG, along with their suppliers, are expected to finalize new testing standards next week. The agreement would reduce the interim approval process for new materials to three weeks from the current eight weeks or more.

AIAG said the group feels confident it can shorten the testing time because alternative resins are already well known in the industry and previous testing has accurately predicted real-world performance.

Automakers and suppliers have been scrambling to determine how much supply of PA-12 they have and whether they can substitute other materials for it. Evonik Industries, the German company whose plant was destroyed, has said it will take at least three months to rebuild the facility. Chris Ceraso, an auto analyst with Credit Suisse, estimated in a recent note to investors that the industry enough PA-12 available to last about two to three months.

General Motors Co. CEO Dan Akerson told CNBC Monday that the company has enough supply to get through most of May.

"Then I think things will sort themselves out," he said.