News from Notch Consulting, Inc.

February 11, 2008

Notch Consulting Group joins IRSG

Filed under: General — Notch @ 10:00 am

Notch Consulting Group has joined the Panel of Associates of the International Rubber Study Group. Notch is proud to become a member of this respected group, which has provided an invaluable service to the rubber and tire industries for more than 60 years. The press release is here.

February 10, 2008

Conti rolls out ContiSeal self-sealing tires as an alternative to run-flats

Filed under: Run-flats, Tires — Notch @ 6:13 pm

Continental is rolling out a new generation of self-sealing tires under the ContiSeal tradename. The tires will be introduced at the Geneva International Motor Show in March 2008. Conti is positioning the tires as an alternative to run-flat tires. On February 1, Conti announced that ContiSeal tires would be used as OE equipment on the Volkswagen Passat CC four-door. The car had its premier at the Detroit Auto Show in January, while its European premier will be at the Geneva show.

From a short article on the technology at

The technology is a first for passenger cars, and features a tacky, viscous coating inside the tread which instantly and permanently repairs punctures as soon as a nail or other debris pierces the rubber. It also automatically fills holes of up to five millimetres in diameter when the object is removed.

Continental says the advantage over the stiffened sidewall technology of run-flat rubber is that ContiSeal can be fitted to standard wheel rims and does not require a low-pressure warning system. However, some concerns have been voiced in the tyre industry that this system could lead to motorists running on weakened or potentially dangerous rubber, as there are no warnings of a loss of pressure. ContiSeal is set to go on sale this summer.

It should be noted that the above-stated advantages over run-flats — that self-sealing tires can be fitted on standard rims and do not require a TPMS — are somewhat misleading. Some early generations of run-flats (most notably the PAX system from Michelin) required customized rims, but most run-flats available today can be fitted on standard rims using standard mounting equipment. As for TPMS, run-flats don’t require these systems to operate but only to warn the driver of pressure loss. Because there is no warning system associated with self-sealing tires, Conti is recommending that motorists running ContiSeal tires get them examined regularly for nails or screws. So the self-seal tires still require some diligence on the driver’s part.

Below: Continental’s ContiSeal technology. Source: Continental Corporation corporate website. Here is the link.


February 7, 2008

Solutia Sues Finaciers Over Chapter 11 Delays

Filed under: Rubber Chemicals — Notch @ 9:29 am

Solutia has sued three of the banks involved in its Chapter 11 refinancing over delays in the restructuring. As previously noted, last month Solutia announced that its emergence from Chapter 11 bankruptcy will be delayed from the previously announced effective date of January 28, 2008 due to problems in obtaining the necessary exit financing.

Solutia Inc. (NYSE: SOA) today filed a complaint in the U.S. Bankruptcy Court for the Southern District of New York against the three banks that had executed a firm commitment to fund a $2 billion exit financing package for Solutia, but to date have refused to meet this commitment. These banks are Citigroup Global Markets Inc., Goldman Sachs Credit Partners L.P., and Deutsche Bank Securities Inc. Solutia is seeking a court order requiring the banks to meet their commitment and fund Solutia’s exit from bankruptcy. The complaint also asserts that the banks should be stopped from invoking the clause they claim relieves them of their obligation due to their improper conduct and misrepresentations to the company, and further claims that the banks fraudulently induced Solutia to enter into the initial engagement by promising that the financing was firmly committed. Solutia and the banks have agreed that Solutia’s claim to require immediate funding of the $2 billion package should be heard by the Court on an expedited basis, with the trial to conclude by the end of February – prior to the expiration of the banks’ commitment.

Solutia’s press release on the suit is here.

February 5, 2008

Huber Acquires Production Assets of Chinese Precipitated Silica Company

Filed under: Silica — Notch @ 12:14 pm

On January 22, 2008, Huber Engineered Materials announced that it had finalized an agreement to purchase the production-related assets of Changzhou City Mingfan Fine Chemical Co., Ltd. (Hengshanqiao Town, Wujin City, Jiangsu Province), which produces various grades of precipitated silica for oral care markets. According to a press release from HEM, Mingfan is a leading Chinese producer of dental silicas. It will continue to manufacture its existing line of dental abrasives for Huber under a toll arrangement. The agreement will allow HEM to offer local silica manufacturing for its Asian customers.

Huber Engineered Materials is currently building a 40,000 tonne/year dental silicas plant in Qingdao, China. The plant was announced in March 2007 and groundbreaking occurred in December 2007. The plant is expected to come on-stream in 2Q 2009.

The press release on the acquisition is here.

On January 2, 2008, Huber Engineered Materials announced a price increase for its specialty grade silica and silicates, effective February 1 or as contracts allow. Prices will increase an average of 5% to 8%, driven by higher raw material, energy, and regulatory costs.

The press release on the price increase is here.

February 4, 2008

Carbon Black World 2008 to be held in Vancouver

Filed under: Carbon Black — Notch @ 1:55 pm

IntertechPira has announced that Carbon Black World 2008 will be held in Vancouver, British Columbia, Canada on November 3-5, 2008. The conference will be hosted at the Renaissance Vancouver Hotel Harborside. More information here.

February 3, 2008

Goodyear’s Ad Campaign for Run On Flat

Filed under: Run-flats, Tires — Notch @ 2:38 pm

From YouTube, here is a collection of three Goodyear ads for its Run On Flat tires. To be honest, I’ve never been able to figure out if these ads are supposed to be satiric or serious. If they are meant to be funny, they’re not. They come off as cruel, even sadistic (hint: slapstick ceases to be funny when people are seriously injured or killed). I don’t think the tire industry is going to sell consumers on run-flats using these types of scare tactics. Convenience and performance are the selling points. Certainly one could go for the safety angle, but not like this.

February 2, 2008

Birla Group to Build New Carbon Black Plant in Sri Lanka, Replacing Patalganga

Filed under: Carbon Black — Notch @ 3:12 pm

Major news today. According to the Sri Lankan Ministry of Enterprise Development, Aditya Birla Group plans to build a $120 million carbon black plant in Sri Lanka. The plant will replace a 120,000 tonnes/year plant announced for Patalganga in Western India. In a previous post on this blog from January 31 discussing Aditya Birla Nuvo’s most recent earnings report, Notch noted that the Patalganga plant was under review. Regarding the new plant, Birla’s earnings report had this to say: “Carbon black business, though received environmental clearance for greenfield expansion by 120 K MT in Western India, will decide after examining other sites.”

The Sri Lankan carbon black plant will be located in the Export Processing Zone (EPZ) at Koggala, near Galle, and will serve customers in Sri Lanka, India, and other countries of South Asia. The agreement was finalized at a recent meeting between Sri Lanka’s Enterprise Development Minister Sarath Amunugama and representatives of the Birla Group. Birla is already active in Sri Lanka through cement joint venture. No capacity was released for the new carbon black plant.

Update: Another story about the new plant from The Hindu Business Line.

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