Toray to Expand Production Capacity of Torayca Carbon Fibre

15 April 2005

Toray Industries, Inc. is to expand domestic production capacity of its PAN-based carbon fibre Torayca by adding two production lines.

The company plans to add two integrated production lines for carbon fibre covering polymerization, precursor spinning, and carbonization (total of 2,200 tons per year), and one production line for prepreg1 (5.8 million m2 per year) at its Ehime Plant (Masaki-cho, Iyo-gun, Ehime prefecture).

Toray will spend a total of 25.0 billion yen for this expansion and these additional production facilities are expected to start operation from January 2007. The company chose Ehime as the site for expansion in response to the enthusiastic request from Ehime prefecture, and providing valuable cooperation from Ehime prefecture and Masaki-cho in the construction of the new facilities.

The expansion in Torayca production capacity is to respond to the growing demand in carbon fibres led by the composite materials for B787, the new passenger aircraft of Boeing Co., U.S. to be entered in service in 2008 as well as the strong growth in general industrial use. As the sole authorized supplier of Torayca prepreg for B787, Toray plans to start full-scale supply of prepreg from its U.S. production site in 2006.

To respond to the fact that the orders for B787 aircraft is increasing faster than expected as well as the growing production of B777, the company decided to expand its carbon fibre and prepreg production capacity. With this expansion, Toray aims to establish a “dual source” supply structure built around its two production sites in Japan and the U.S. and establish a stable supply system for Boeing as well as the Japanese heavy industry companies that are the suppliers of main structural parts for B787.

Along with the recovery in aircraft demand, the aeronautical industry is experiencing a rapid “shift to composite materials” in the development programs for new aircrafts and is facing a historic expansion of demand for such materials. Also in the general industrial applications, production of various large-scale applications such as pressure vessels, blades for windmills and automobile materials using PAN-based carbon fibre has been entering into mass production from test phases. Moreover, demand has also been rapidly increasing in Asia led by China for civil engineering and construction applications and so on, leading to increasing tightness in the supply-demand balance at present.

The demand for PAN-based carbon fibre for 2004 was estimated to be about 22,000 tons and, taking into consideration such developments in various applications, the demand is forecast to grow at an annual rate of more than 10% in the future and is expected to exceed 30,000 tons in 2007.

Toray has positioned the carbon fibre Torayca composite material as the core product of its advanced materials and is promoting a strategic expansion of this business. The move announced this time is the third expansion in production facilities following similar expansions in France and the U.S and the group’s production capacity for carbon fibre will increase to 13,100 tons per year and for prepreg production will expand to 22.2 million m2 per year by 2007. As the leading manufacturer of carbon fibre in the world, Toray will continue to strengthen its global supply system with the existing three bases in Japan, the U.S. and Europe. Toray intends to expand its global share to carbon fibre to about 40% *4 and sales in excess of 110 billion yen by 2010 in its Torayca advanced composite materials business by utilizing its strength of overall technical development prowess cutting across carbon fibres, intermediate materials and composite materials and also by enhancing its vertical integration business model.

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