Du Pont Kevlar® Aramid

Industrial Fiber

Nikunj, Rubini & Madhuvanthy

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 Facts …
• Company: Du Pont
• Business: Fiber & polymer manufacturing
company
• Product- Kevlar® Aramid Industrial Fiber
• Protagonist:
– Howard .W .Swank- GM, Du Pont’s Textile
Fibers Dept.
• Year: 1974

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 Current Scenario
• Kevlar®Aramid fiber - a miracle fiber of extraordinarily
complex chemistry, was his department’s newest
development
• Submitted a 3-part appropriation request for capital to
build a 50 Mn pounds/year plant for its manufacture
• Has asked for $82 million of the projected $332 Million-
For the:
– Partial design for the plant and cost estimates preparation
– Cancellation cost of longtime delivery equipment

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 Development of Kevlar
• 1965, Stephanie and Paul developed a polymer
which when spun into fiber was highly stable to
high temperatures and 7 times stiffer than
Nomex, Nylon and Dacron
• 1969, the polymer named as fiber-B was tested
on selected tire companies (as tire cord material)
to key aircraft manufacturers (as a reinforcement
in plastic composites)
• Feedback from tire companies: “Outstanding
product performance superior to all known
incumbents”
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 Problems with Fiber B
• Estimated cost of production was extremely high
• To achieve adhesion to rubber tire makers had
to apply adhesive for Fiber B under
extraordinarily high tensions
In 1972, they refined fibre B and it was called
fibre B-1. This gave a higher stiffness and
tenacity

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 Request for setting up of MDF
(market development facility)
• The chemists at TFD were highly confident Fiber
B-1’s performance
• They wanted to make most out of the rapidly
unfolding events in the tire cord market, aircraft
and aerospace industries
• They wanted to roll out as much fibre B1 as
possible into the market from the plant

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 Request for MDF- II
Characteristics
– It would contain prototype technology for all of the
critical elements of a projected commercial plant
– Generates design data and cost data
– Annual capacity is six million pounds
– In 1972, the request was approved
– By the end of 1973, MDF I & II produced a million
pounds of fiber at an average cost of $20 per pound.
It was now that this fiber B1 was trademarked as
Kevlar Aramid Fiber

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 Kevlar’s Market
• Target Audience
– Tire market
– Aerospace and Aircraft industries
• Need
– Fiber for making tire cord (Tire Market)
– Composite materials (Aerospace Industry)

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 Tire Market-Situation
• 1970’s- Radial tire came into being
• Nylon and polyester did not posses the properties
necessary to make a tire cord for radial belts
• Hence, if tire industry took up radials, Du Pont would
have to suffer
• Fibre-glass or steel could capture the belting market but
this was not Du Pont’s forte. They had to clearly pre-
empt steel
• Kevlar, the managers thought, would help maintain the
business if not command the industry

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Kevlar’s Opportunities

Kevlar vs Steel

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 Kevlar Vs. Steel
• Kevlar was 4 to 5 times stronger than steel
• Kevlar’s tenacity and modulus was superior to
steel tire cord, except elongation
• Steel tire cord was short in supply
• Steel tire cord manufacture was highly labor
intensive
• Kevlar was lighter, energy efficient, smoother ride
• Kevlar could be used on tire manufacturing
equipment unlike steel
• Did not experience problems with handling large
radial truck tires
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• Kevlar MDF II was hard-pressed to meet
the tire industries demand
• The dept. projected that a 50 mn pound
Kevlar plant would provide the necessary
economies of scale for Kevlar to compete
with steel tire cord

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 Kevlar in composite materials
• Composite materials - These were in their
infancy stage when Kevlar was first introduced
• Boeing and Lockheed had adopted Nomex in
non structural aircraft panel composites
• This helped secure a significant entry into the
composite materials market for Du Pont

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 Kevlar Vs. Fibreglass
• Kevlar’s density is lower than fiber glass while
possessing roughly the same tensile strength and a
higher modulus
• Substituting Kevlar for fiber glass would reduce weight of
atleast 25% adding value of about 25 dollar per pound in
aircraft
• Kevlar absorbed radar
• Kevlar would also have to compete with Carbon & Boron
fibers since composites made from carbon & boron are
more stiff

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 Challenges in Tire Industry
• Challenge for Kevlar: Economics of
production
• To gain market share, pricing of Kevlar
should not be more than 4 to 4.8 times
that of steel

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 Challenges in Composite Materials Market

• Pricing
• Market dominated by Fibreglass. So:
– Prove that plastic composites (in general) and
Kevlar (in particular) are better than Fibre
Glass Composites

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 Management Concerns
• Committing a lot of investment capital and
several years of operating loss
• Since the commitment to new ventures program
in 1960’s the short run earnings of the company
has been hurt.
• To improve this situation the company has to
watch its capital expenditure carefully
• Agreeing or accepting Kevlar would increase the
commitments to $1 billion

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 Prospects for Kevlar
Nomex Kevlar
• Slow, Uncertain, Tedious • Fast Market
Market Growth • Aerospace & Tire Market
• Customers unwilling to are willing to adopt Kevlar
substitute for tried and • The whole department
true in their established seemed to have a
products consensus over Kevlar
• Nomex had to be used in
developing products
• Plant operated below
capacity
• Operational Problems
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 Our view …
Yes, Kevlar should be implemented for the
following reasons:
1. Kevlar is an improved product unlike Nomex
2. It has been already tested in the market with key
customers as Tire manufacturers and aerospace
manufacturers
3. The company has already invested so much in MDF
I & II that it cannot be simply scrapped off
4. TFD department is a major contributor to the
company’s earnings. Moreover, the X- Committee
members are not unfamiliar with Kevlar
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 Ways to fund the project …
• Issue shares/ debentures
• Stop manufacturing the problem children,
use/sell (partly or completely) their
manufacturing facilities and use this to
fund the Kevlar project

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 Learnings
• Never agree to all the ideas which come up in an
organization, especially when it is consecutive
• The financial implications of a project in terms of
cash flow should be considered
• The importance of market situational analysis before
the launch of a product (absent in Nomex, present in
Kevlar)

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 Contd…
• The significance of testing the product before the
launch of a product
• Need for understanding the proper market needs
(Shift from fiber B to fiber B1)
• Difficulty in convincing prospective customers to
shift to our product by weaning away from their
current products

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