Challenges and Opportunities facing EU companies in Technical Textiles

The world market for Technical Textiles is estimated by Gherzi at 24 million tons
p.a.(2012), corresponding to an industrial sales volume beyond US$ 160 billion
(including downstream value added steps like technical make-up, resin impregnation,
etc.).
The largest Technical Textile global enterprises like Ten Cate (NL), DuPont (USA),
Ahlstrom (S), Cytec (USA), etc. � are achieving well over USD$ 1 billion in annual
sales.
Worldwide, Technical Textiles represents 30 % of all textiles produced. In
countries like Germany, the Technical Textiles share in tonnage is already reaching
about 60% of all textiles produced and is expected to reach 64% by 2015.
Technical Textiles in the abovecontext include high performance composite
reinforcements like glass or carbon fabrics (16% world TechTex share), nonwovens
(32% world TechTex share) and other woven, knitted, braided or yarn type products
(51% world TechTex share).

Fig. 1: Technical Textile Market share

Source: Gherzi research and estimates
Looking at individual company performance in European Technical Textiles, it is
apparent that this field has offered a fertile ground for above average returns:
12% to almost 20% EBITDA return on sales is not uncommon. The sector also allows
for listing on the stock market,as demonstrated by key players Ten Cate (NL) or Low
& Bonar (UK).
The key critical issues which - in Gherzi�s view - this industry has to face in
Europe, is to a lesser extent the import threat from ready-made products coming
into Europe from Asia but more so the erosion of the European manufacturing base of
key synthetic fibres needed for the production of Technical Textiles.
This holds true especially for the field of Polyester industrial yarns, where China
in 2012 already controlled 60% of world production and is moving up to beyond 75%
by 2015.
Also, China is heavily investing into the downstream conversion of these yarn
capacities into fabrics, which are then to be exported to a considerable extent to
the world markets including Europe. High and growing EU imports of tire cord
fabrics and PET based coating substrates from China underline this trend.
On the other hand, the European Technical Textiles industry can also profit from
positive trends in some key technologies and markets which are growing faster than
the Technical Textiles industry as a whole.
Nonwovens clearly continue to be a higher than average growth industry (CAGR Europe
5.2% between 2009 and 2013) with some Non-Woven technologies � such as spunlacing
(hydro-entanglement of carded webs) or spunbond (spunmelt nonwovens ex chips) �
showing higher growth rates than nonwovens overall.
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uPmY6AYoxKyEicEmHa5LqhZ1E4UvLepAQOwhttp://www.textileworld.com/Articles/2008/May_20
08/MayxJune_2008/spunlaidprocess.jpg
Fig. 2: Spunlace Technology and Spunlaid Technology
Source: EDANA
This is certainly due to the fact that nonwoven technologies are becoming more and
more flexible, leading to nonwovens entering fields so far reserved for, e.g.,
wovens. The market introduction of Meta-Aramide based nonwovens for protective
garments (�Protech�) � which were historically based on wovens � is one indication
for this trend. Spunlace nonwovens for decorative car interiors (replacing knits)
are another indication.
Another above average growth area is to be found in textile reinforcements for high
performance continuous filament reinforced plastics (�composites�).
Historically based on glass, Para-Aramide or carbon and driven by industries like
aerospace, boat-building, sports equipment and wind turbines, continuous
filamentfabricbased composites are now entering the automotive sector as well as
areas like high end luggage (with PP tape based wovens), Medtech (prosthesis),
Medical equipment, etc.
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