Chemistry & the Economy: 2015 Mid-Year Review

6/3/2015

We will begin momentarily at 2pm ET

Recordings will be available to ACS members after three weeks

www.acs.org/acswebinars Contact ACS Webinars ® at [email protected]

1

Have Questions?

“Why am I muted?” Don’t worry. Everyone is muted except the presenter and host. Thank you and enjoy the show.

Type them into questions box! Contact ACS Webinars ® at [email protected]

2

1

6/3/2015

Have you discovered the missing element?

www.acs.org/2joinACS Find the many benefits of ACS membership! 3

Benefits of ACS Membership Chemical & Engineering News (C&EN) The preeminent weekly news source.

NEW! Free Access to ACS Presentations on Demand® ACS Member only access to over 1,000 presentation recordings from recent ACS meetings and select events.

NEW! ACS Career Navigator Your source for leadership development, professional education, career services, and much more.

www.acs.org/2joinACS

4

2

6/3/2015

Like us on Facebook!

facebook.com/acswebinars

How has ACS Webinars benefited you?

5

®

“ACS Webinars allow me to gain knowledge from respected people in the field, which is fantastic. I also like that a good portion of the session is Q&A!”

Patience Wright, Chemistry Graduate Student, University of Georgia

Be a featured fan on an upcoming webinar! Write to us @ [email protected]

6

3

6/3/2015


@acswebinars youtube.com/acswebinars

7

Hungry for a brain snack?

TM

“ACS Webinets are 2 minute segments that bring you valuable insight from some of our most popular full length ACS Webinars ® ”

See all the ACS Webinets at youtube.com/acswebinars

8

4

6/3/2015

All recordings of ACS Webinars will be available to current ACS members three weeks after the Live broadcast date.

Live weekly ACS Webinars will continue to be available to the general public.

Contact ACS Webinars ® at [email protected]

9

®

Upcoming ACS Webinars www.acs.org/acswebinars

Thursday, June 11, 2015

“Science Communication in the Digital Media Age” Nathan Allen, Moderator of /r/science, Reddit Chris McCarthy, Social Media Manager, American Chemical Society


“Advanced Pyrotechnics 2: Ignition, Sensitivity, and Analysis of Energetic Materials” Chris Mocella, U.S. Customs and Border Protection Laboratories Darren Griffin, University of Kent


10

5

6/3/2015

“Chemistry & the Economy: 2015 Mid-Year Review”

Mark Jones

Paul Hodges

Executive External Strategy and Communications Fellow, Dow Chemical

Chairman, International eChem

Recordings will be available to ACS members after one week


11

2015 Mid-Year Review Today’s Aging Populations Challenges and Opportunities

4 June 2015 CREATIVE ENERGY FOR IMPORTANT ISSUES

6

6/3/2015

OUR SERVICES BLOG & BOOK

www.iec.eu.com

THE pH REPORT

KEYNOTE SPEECHES

Senior Management

Conferences

PROJECTS

WORKSHOPS Strategy/Planning

Making It Happen

PAUL HODGES [email protected] +44 20 7700 6100 CREATIVE ENERGY FOR IMPORTANT ISSUES

EXECUTIVE SUMMARY  The global population is ageing: fertility rates have halved since 1950, life expectancy is up by 50%  Household spending drives GDP, and it declines past the age of 50 – 55 years  Central banks have tried to compensate by creating wealth effects via sub-prime and quantitative easing  China’s New Normal policies are now the catalyst for change  Affordability and new technologies will be the winning strategies for the future CREATIVE ENERGY FOR IMPORTANT ISSUES

7

6/3/2015

AGENDA  Aging US population creates headwinds for economic growth  Impact on auto markets  New growth opportunities

CREATIVE ENERGY FOR IMPORTANT ISSUES

“60 PEOPLE IN EVERY 100 HAVE THE SMALLPOX. OF THESE 60, 20 DIE OF IT IN THE MOST FAVOURABLE SEASON OF LIFE.” Voltaire, Letter on Inoculation, 1733

In London during the 1700s, ”In certain districts the infant mortality rate reached 75% of all births whenever epidemics struck” Matthew White, British Library

Lady May Montagu with son, Edward Variolation vaccination Constantinople, 1718

Dr Edward Jenner with gardener’s son Cowpox vaccination, Gloucestershire 14 May 1796 CREATIVE ENERGY FOR IMPORTANT ISSUES

8

6/3/2015

ECONOMIC GROWTH TOOK OFF ONCE SMALLPOX VACCINATION WAS INVENTED Vaccination, disinfection, pharma and now healthy lifestyles have changed our lives


US BABYBOOM OF 1946 – 1964 SAW 9 MILLION EXTRA BABIES BEING BORN, VERSUS THE 25 YEARS 1921 - 1945


9

6/3/2015

FERTILITY RATES HAVE BEEN BELOW REPLACEMENT LEVEL SINCE 1970, LIFE EXPECTANCY AT AGE 65 IS NOW 20 YEARS Fertility rates are now just 1.7 babies/woman in the Low Case


Audience Survey Question ANSWER THE QUESTION ON BLUE SCREEN IN ONE MOMENT

Who spends the most? • • • • •

18-25 year olds 25-35 year olds 35-45 year olds 45-55 year olds older than 55

20

10

6/3/2015

US HOUSEHOLD SPENDING DATA CONFIRMS MAJOR DECLINE AFTER AGE 55


SPENDING POWER NOW UNDER PRESSURE AS LABOR PARTICIPATION RATES DECLINE FOR MEN & WOMEN Spending power had increased as women entered the workforce in large numbers


11

6/3/2015

US HOUSEHOLD SPENDING HIGHLIGHTS IMPACT OF THE AGEING BABYBOOMERS ON DEMAND Consumer spending is 2/3rds of GDP: Over-55s spend 15% less than under-55s, and their numbers are rising


THE G-20 CONTAINS ‘RICH BUT OLD’ GROUPS IN THE WEST: ‘POOR & YOUNG’ AND ‘POOR & AGEING’ ELSEWHERE


12

6/3/2015

MOST G-20 DEVELOPED COUNTRIES ARE ‘AGEING & IN DEBT’, OTHERS ARE ‘YOUNG & LOW DEBT’ OR ‘AGEING & LOW DEBT’


AGENDA

 Aging US population creates headwinds for economic growth  Impact on auto markets  New growth opportunities


13

6/3/2015

GLOBAL CHEMICAL INDUSTRY OPERATING RATES HAVE FAILED TO RECOVER SINCE 2009


AGEING POPULATIONS DRIVE LESS AS WORK AND FAMILY COMMITMENTS REDUCE USA

GERMANY Co-products produced with each ton of ethylene


14

6/3/2015


In 2014, US drivers averaged the same number of miles travelled by car as in: • 2004 • 1995 • 1990 • 1985 • 1980

29

US VEHICLE MILES TRAVELLED PER ADULT HAVE FALLEN 8% SINCE 2004

Page 30 CREATIVE ENERGY FOR IMPORTANT ISSUES

15

6/3/2015

US AUTO AND HOUSING MARKETS ARE SHOWING SIGNS OF AGE Co-products produced with each ton of ethylene


GLOBAL AUTO SALES WOULD STILL BE BELOW 2007 LEVELS WITHOUT CHINA The ‘top 7’ are 80% of total world demand

Page 32 CREATIVE ENERGY FOR IMPORTANT ISSUES

16

6/3/2015

THE COST OF CHINA’S ‘GROWTH AT ALL COSTS’ MODEL HAS BECOME TOO GREAT


“THE CONCEPT OF A “NEW NORMAL” FOR THE WORLD’S SECOND LARGEST ECONOMY IS NOW PREVAILING AT HOME AND ABROAD” Xinhua, September 2014

PRESIDENT XI JINPING, opening the 3rd Plenum, November 2013

Co-products produced with each ton of ethylene

“The good meat is all gone; all that is left are hard bones to chew.”

PREMIER LI KEQIANG, in his Work Report to the National People’s Congress, March 2015 “China’s economic growth model remains inefficient; our capacity for innovation is insufficient; overcapacity is a pronounced problem and the foundation of agriculture is weak. Growth in investment is sluggish; the number of new areas of strong consumer activity is limited; there is no sign the international market is about to significantly pick up; maintaining stable growth is becoming more difficult” CREATIVE ENERGY FOR IMPORTANT ISSUES

17

6/3/2015

CHINA’S AUTO MARKET IS MATURING AND WILL SEE HIGHER GROWTH IN USED CAR SALES Co-products produced with each ton of ethylene


AFFORDABILITY BASED ON INCOME, NOT PROPERTY WEALTH EFFECT, WILL DRIVE FUTURE GROWTH Average per capita urban incomes in 2013 were Rmb 29547 ($4769):  Every household owns a mobile phone, colour TV and air conditioner  Everyone owns a washing machine and refrigerator  1 in of 5 households own a motor bike and own a car  Almost every household owns a computer and water heater Average per capita rural incomes were $1276:  Every household has a mobile phone and a colour television  2 out of 3 households now own a washing machine and refrigerator  2 out of 3 households now own a motorbike, whilst bicycle ownership has halved since 1995  But only 1 in 5 own a computer CREATIVE ENERGY FOR IMPORTANT ISSUES

18

6/3/2015

AGENDA  Aging US population creates headwinds for economic growth  Impact on auto markets  New growth opportunities



What new technology areas do you think are most exciting? • virtual reality • wearable computing • internet of things • 3D printing • quantum computing

38

19

6/3/2015

BEYOND THE HYPE OF ‘BIG DATA’, NEW BUSINESSES ARE BEING CREATED TO MEET FUTURE NEEDS


NEW BUSINESS MODELS ARE ENTERING AEROSPACE INDUSTRY AS ADDITIVE PRINTING ARRIVES “$3.4bn/yr savings in maintenance, repair and operations”

PwC


20

6/3/2015

3D PRINTING MOVES FROM PACKAGING TO SKIN CARE US ARMY DEVELOPS NEW SKIN FOR FRONT-LINE BURNS TREATMENT “The scars that Soldiers develop as a result of burns constrict movement and disfIgure them permanently. The initiative to restore high-quality skin that is elastic and complete with sweat glands, appropriate pigmentation and hair follicles is incredibly important” Dr Michael Romanco, US Army

P&G OFFERS $44M GRANT FOR 3D COSMETICS TESTING “We want to look at the possibilities of bioprinting. It’s definitely a very strong emerging area. We have a number of different in vitro skin models we’re working on because we are very involved in beauty care. If companies are doing innovation and interested in new tools then bioprinting should very much be on their horizon.” Prof Elena Lurie-Luke, head of P&G’s Global Life Sciences Open Innovation CREATIVE ENERGY FOR IMPORTANT ISSUES

PROCESS INTENSIFICATION OFFERS OPPORTUNITY TO MOVE FROM BATCH TO CONTINUOUS MANUFACTURING TIME FOR A CHANGE AFTER 500 YEARS

 Process Intensification reduces plant size and increases flexibility  Manufacturing can take place locally, rather than centrally  Major increases can be achieved in process efficiency  Capex and Opex costs can be dramatically reduced  Quality is improved whilst waste is reduced  Operational simplicity benefits safety CREATIVE ENERGY FOR IMPORTANT ISSUES

21

6/3/2015

SAFER, GREENER, FASTER AND CHEAPER  Companies need to reduce manufacturing costs, and increase their flexibility to respond to changing market needs  NiTech’s continuous crystallisers and reactors are designed for this challenge  They are portable, modular and easily scalable  Costs are reduced whilst product quality and safety are improved  Energy usage and waste are also reduced, improving sustainability  They can handle a wide range of chemistries and be used across industry sectors

 Several major companies are already using the technology to improve their competitive position in today’s fast-changing markets


THE MIDDLE GROUND IS DISAPPEARING AS THE BOOMER SUPERCYCLE ENDS HIGH P E R C E I V E D

V A L U E

NICHE MIDDLE GROUND OF ‘AFFORDABLE LUXURY’ DISAPPEARING

AFFORDABILITY, LIFETIME COST, NOW KEY TO SUCCESS

LOW HIGH

DELIVERED COST

MASS-MARKET LOW CREATIVE ENERGY FOR IMPORTANT ISSUES

22

6/3/2015

COMPANIES THAT FAIL TO ADAPT WILL GO OUT OF BUSINESS THE TRANSITION TO THE NEW NORMAL WILL CREATE WINNERS & LOSERS Losers in the transition to the New Normal believe:

Winners in the transition to the New Normal believe:

 Stimulus programmes will return markets to the way they used to be.

 The future will be different from the past, with new challenges and opportunities.

 China’s demand will be the saviour of the global industry

 Companies need to realign their offerings with key demographic drivers eg the ageing BabyBoomers  The rise in oil prices meant and greater domestic consumption end-user demand was robust. The megatrends in emerging economies  Companies now ‘caught in  Profitable growth will come from Food the middle’, neither low-cost or providing sustainable solutions that Water selling a solution, will somehow meet real needs (not just “wants”) in regain pricing power. Health these new markets Shelter Mobility 45 CREATIVE ENERGY FOR IMPORTANT ISSUES

Disclaimer Strictly Private & Confidential This Research Note has been prepared by IeC for general circulation at the ACS webinar on 4 June 2015. The information contained in this Research Note may be retained. It has not been prepared for the benefit of any particular company or client and may not be relied upon by any company or client or other third party. IeC do not give investment advice and are not regulated under the UK Financial Services Act. If, notwithstanding the foregoing, this Research Note is relied upon by any person, IeC does not accept, and disclaims, all liability for loss and damage suffered as a result. © International eChem 2015. All rights reserved


23

6/3/2015


Mark Jones

Paul Hodges





47

®







48

24

6/3/2015


Mark Jones

Paul Hodges





How has ACS Webinars benefited you?

49

®

“ACS Webinars allow me to gain knowledge from respected people in the field, which is fantastic. I also like that a good portion of the session is Q&A!”

Patience Wright, Chemistry Graduate Student, University of Georgia

Be a featured fan on an upcoming webinar! Write to us @ [email protected]

50

25

6/3/2015


@acswebinars youtube.com/acswebinars

51

Benefits of ACS Membership Chemical & Engineering News (C&EN) The preeminent weekly news source.

NEW! Free Access to ACS Presentations on Demand® ACS Member only access to over 1,000 presentation recordings from recent ACS meetings and select events.

NEW! ACS Career Navigator Your source for leadership development, professional education, career services, and much more.

www.acs.org/2joinACS

52

26

6/3/2015

®

ACS Webinars does not endorse any products or services. The views expressed in this presentation are those of the presenter and do not necessarily reflect the views or policies of the American Chemical Society.


53

®







54

27

Chemistry & the Economy: 2015 Mid-Year Review

Recommend Documents