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Dieses Dokument ist Teil der Anfrage „Bachelorthesis Plastic Tax Environmental Politics“
Ref. Ares(2021)4534463 - 13/07/2021 June 2016 Competitiveness of the European Plastics Converting Industry a european industry study
Dr. Wieselhuber & Partner GmbH
Competitiveness of the European Plastics Converting Industry 3 Foreword Resource efficiency, the circular economy, mass customiziation, e-mobilty … to name but a few. All of these megatrends have a common denominator: they critically rely on plastics products and components! Thus, the polymer industry is a key building block shaping the future economy as well as the industrial and private consumption. European plastics converters are at the heart of the polymer industry providing inno- vative products and solutions for various appliances in customer industries. In recent times, more and more converter company executives state a critical opin- ion about the competitiveness of the European plastics converting industry. They particularely see the industries’ future at risk if market and framework conditions continuously pose threats to the competitive strength of converters. Furthermore, management responses to market conditions, which develop and change at a faster pace become intensely complex. To assess how the industry structure developed recently and how it will develop in the future, plus insights on corporate pattern to cope with changing market conditions are thus a main interest for all stakeholders within the European plastics converter industry. The European industry study on the “Competitiveness of the European Plastics con- verting industry” by Dr. Wieselhuber & Partner (W&P) in cooperation with the EU- level trade association of the plastics converting industry, EuPC, is focused on the assessment of the industries’ current as well as future level of competitiveness. As one of the largest industry studies with a most representative industry sample, the study clearly showed that a more intense competition and many disadvantageous regulatory framework conditions constitute a massive threat to the competitiveness of EU plastics converters. However, study insights also show that converters can still rely on their strength in efficiency, innovation and customer proximity to maintain their competitiveness. We very much like to thank all respondents of the industry study as well as the company executives and industry experts being available for the complementary in- terviews. This in-depth industry perspective is what makes this study unique and most valuable. We wish you a hopefully insightful and inspiring reading of the study. Munich, June 2016 Prof. Dr. Norbert Wieselhuber Dr. Stephan Hundertmark Managing Partner Manager - Plastics Industry Dr. Wieselhuber & Partner GmbH Dr. Wieselhuber & Partner GmbH european plastic converters
4 Competitiveness of the European Plastics Converting Industry Dr. Wieselhuber & Partner GmbH
Competitiveness of the European Plastics Converting Industry 5 Content Foreword 3 Executive Summary 6 1. Objective of the Industry Study on European Plastics Converters 12 1.1 European Plastic Converter Industry 14 1.2 Objective of the Industry Study 15 2. Empirical Industry Study 16 2.1 Study Design 18 2.2 Industry Sample 19 3. Results of the Study in Detail 22 3.1 Assessment of the Competitive Environment 22 3.2 Assessment of the Regulatory Framework Conditions 28 3.3 Assessment of the Supply Situation 31 3.4 Assessment of the Market and Demand Conditions 34 3.5 Self-Assessment of the Competitiveness of EU Plastics Converters 37 4. Maintaining Competitiveness 40 4.1 Corporate Response to Maintain Competitiveness 42 4.2 Strategic Levers to Maintain Competitiveness 45 Contact 47 european plastic converters
Executive Summary
8 Competitiveness of the European Plastics Converting Industry Executive Summary What is the current level of competitiveness of the European plastics conver- ting industry and how will it develop in the near future? As plastics products are of highest relevance in many industry segments and for the satisfaction of consumer needs, this question is of particular interest. The European industry study on the “Competitiveness of the European Plastics converting industry” by Dr. Wiesel- huber & Partner (W&P) in cooperation with the EU-level trade association of the plastics converting industry, EuPC, is focused on the assessment of the industries’ current as well as future level of competitiveness. Based on a large scale-survey with 326 EU plastics converters from 19 European countries and more than 20 complementary expert interviews with mostly senior company representatives, managing owners and industry experts, the study provi- des a unique industry insight. Due to a most adequate match of the sample with the general industry structure in terms of company size, industry segments and country distribution of the EU plastics converting industry, the results are highly valid and reliable for direct management as well as policy implications. The study design follows a basic industry structure model to assess the indus- tries’ competitiveness in terms of the competitive situation, the regulatory frame- work conditions, the supply situation as well as the market and demand conditions. The analysis is complemented by a self-assessment of plastics converters and a compilation of most important management responses to maintain business com- petitiveness. 1. EU converters face a fiercer competition with an increase of non-EU com- petitors entering the EU market. Still EU companies compete mostly with other European plastics converters. However, for more than 30 % of the converters Chinese and Turkish companies are already highly relevant competitors. The com- mon belief among European plastics converters is that the relevance of non-EU competitors will continue to increase and thus further intensify the competitive rivalry in the industry. To defend their competitiveness and withstand in a fiercer competitive environ- ment, EU converters leverage their innovativeness and customer proximity along with the constant drive for efficiency as market entry barriers wherever possible. The resulting innovative products and solutions are still very competitive in global markets. Accordingly unsurprisingly, also in export markets, EU converters mostly face other EU producers of plastics products as main competitors. 2. The bureaucratic and regulatory framework conditions within the EU are as- sessed as mostly stable for plastics converters. Nevertheless, cost burdens from direct taxes or necessary effort to comply with domestic and EU-driven regulations and requirements have worsened substantially compared to previous years. This development poses a massive threat to the competitiveness of EU plastics converters. Still, most converters expect a further worsening of the situa- tion. As a result, study respondents from large, multinational active converters Dr. Wieselhuber & Partner GmbH
Competitiveness of the European Plastics Converting Industry 9 assess a shift of their investment focus to outside of the EU. Small and mid-sized converters with a strong regional focus more directly face a decline in their cost competitiveness and sometimes place their longterm business success in ques- tion. 3. Assessing the level of fragmentation of the EU single market, the study clearly revealed that mostly domestic legislation and slow adoption of EU regulations within the member countries is responsible for a still not level European play- ing field. 4. European converters have to deal with a twofold supply situation. The serious disruptions in the availability of basic polymers in 2015 led to a critical assessement of most converters in the current and future reliability of polymer suppliers. Additionally more volatile prices are expected, which also may effect the short term competitiveness of particularily SME converters. Contrary to the situation with basic polymers, the availability as well as the industry cooperation with suppliers of specialized niche products/grades and machine and processing technologies is assessed as mostly positive. Furthermore, close linkages within these industry networks are positively highlighted as a key source for industry innovations. 5. Study results back the assessment of the EU market as being attractive for most converters and their customer industries. Apart from emerging non-EU regions with bigger growth options, predominantly attractive for large, multinatio- nal converters, the EU markets’ attractiveness is driven by stable framework con- ! Threats to Competitiveness 0 W Fierce competition with a further Management Levers increasing relevance of non-EU to maintain Competitiveness competitors W A critical level of bureaucratic W Asset investments with a focus on burden with direct cost effects replacement, efficiency and W Worsened for supply conditions for capacity expansion basic polymers, while suppliers of W Constant striving for efficiency innovative materials, machine and process technologies are key levers W Focus on innovation and quality for the industries’ innovativeness W Customer proximity as a competitive W Competitiveness of EU converters advantage to non-EU competitors is continously W Business expansion within the EU at risk in price competition Figure 1: Management leavers and threats and abroad to competitiveness W Review of the corporate strategy if business evolution cannot cope with market revolution european plastic converters
10 Competitiveness of the European Plastics Converting Industry ditions and sufficient growth options for polymer products. EU plastics converters can leverage their main competitive advantages, efficiency, innovation and custo- mer proximity, within such market conditions and defend their competitiveness to global competition. 6. Facing a more intense competition within the European market and threats to their competitiveness from the supply side as well as increasing burdens from the regulatory framework conditions, EU plastics converters unsurprisingly have a very critical self-assessment of their competitiveness. Compared to non-EU competition the vast majority of converters assess their competitiveness as worsened in terms of price, energy and labor costs. Contrary to these factors, converters assess their competitiveness as positive and still improving in terms of product quality, complementary service offers and substitutions for non-plastics products. This mixed picture reveals the conflict for most EU plastics converters: being highly competitive at the front-end with customer solutions while struggling to cope with disadvantageous cost structures at the back-end of their business. As a result, converters necessarily need to focus on efficiency and innovation at the same time, compared to many non-EU competitors. 7. To maintain their competitiveness converters show some clear patterns of management and strategy responses. Increasing efficiency and operational ex- cellence is the predominant management objective to maintain competitiveness. To offer attractive products and solutions for customer industries, most conver- ters focus and invest in innovation and leverage customer proximity with custom- ized solutions. Additionally options for business growth are on the agenda of the management board together with a critical review of the business strategy, when it seems that business evolution cannot cope with market revolution. The European industry study shows that the competitiveness of Europ- ean plastics converters is still on a sound level but more and more at risk: Fierce competition from non-EU competitors, further increasing cost burdens from policy-driven regulations and duties and a less reliable supply with basic polymers and qualified staff are the key factors diminishing the industries’ competitiveness. However, a constant drive for efficiency and operational ex- cellence as well as innovation and customer proximity are the key corporate levers to maintain the competitiveness on converting businesses. Accordingly, the mix of a more cautious industry policy on the domestic as well as the EU-level combined with tailored and ambitious strategic manage- ment responses is the answer to maintain the competitiveness for European plastics converters to global competition. Dr. Wieselhuber & Partner GmbH