Plastics Production in Europe Covestro is scaling back its PC production

Covestro plans to significantly scale back production of one of its most important plastics in Europe. Production of standard polycarbonate at its Antwerp, Belgium, facility is to be reduced from four lines to one.

Covestro plans to production of standard polycarbonate at its Antwerp site. Production is to be reduced from four production lines to one. In addition, production of the polycarbonate precursor bisphenol A (BPA) is to be discontinued. This move will affect 260 jobs.

Polycarbonate (PC) is used, for example, in large-volume bottles, car headlights, laptop cases, and in the construction industry. Covestro is the world's leading PC manufacturer. However, the company is facing increasing competitive and pricing pressure.

"The European chemical industry is at a crossroads. The structural challenges are significant, and market conditions have changed fundamentally. To secure the future of our production in Europe, we must strategically adapt our portfolio in areas where we can remain competitive in the long term,” says Markus Steilemann, CEO of Covestro.

Structural Market Pressure on European Polycarbonates 

The announcement highlights the structural challenges currently facing the European chemical industry. High production and energy costs, weak demand, and increasing international competition continue to put pressure on Europe’s competitiveness. So far, European industrial policy has failed to effectively address these challenges and eliminate existing competitive disadvantages. 

At the same time, significant capacity expansions, particularly in Asia, have led to persistent global overcapacity in standard polycarbonates. As a result, plant utilization has declined significantly and is expected to remain at a low level for the foreseeable future. 

Against this backdrop, Covestro has been posting increasing losses at its Antwerp site since 2022. From the company’s perspective, the current setup is therefore no longer economically viable. 

A Greater Focus on High-Performance Materials 

According to a press release, the Antwerp facility is nevertheless expected to remain an important part of the European production and innovation network. The majority of operations are expected to continue as usual and will not be affected by the planned measures. 

In the future, the remaining polycarbonate production line will focus on higher-value specialty products such as heat-resistant high-performance polycarbonate (APEC). The previously announced investment in a new aniline production facility will also proceed as planned, strengthening Antwerp’s role as a key aniline production hub in Europe. Polyether production will remain unaffected by the planned measures, as will the technology center in Antwerp. 

“It is becoming increasingly difficult to produce standard products competitively in Europe. At the same time, we continue to see attractive prospects in the area of high-quality specialty materials,” says Thorsten Dreier, Chief Technology Officer at Covestro. To remain competitive on the global stage, a competitive cost structure is essential.  (me)