Cost changes, because they might affect supplies of aromatics and ole fins, are harder to pin down than op erating changes. If the 2.3-cent pro posed tax is a maximum and octane values hold at present levels, compe tition might add 5 cents a gallon to aromatics prices. The 2.3-cent figure can be con sidered indicative of the additional cost of making unleaded gasoline now, one refining consultant suggests. This is especially so since the idea for the added tax may have come from testi mony on March 25 by Robert C. Gunness, president of Standard Oil Co. (Ind.), the only major producer of unleaded gasoline, to a Senate sub committee on air and water pollution. Mr. Gunness said that unleaded gaso line costs more to make and must carry a higher price. The tax would equa lize the cost of leaded and nonleaded gasoline and eliminate a price penalty for people using nonleaded fuel.
CHEMICAL INDUSTRY:
New Route to Profits The chemical industry for years was profitable in spite of poor management but has now reached the age of ac countability. To bolster eroding prof its, the industry must develop new technology attuned to a shifting soci etal emphasis; combine chemicals, equipment, and know-how into a sys tems package instead of just selling chemicals; and integrate forward all the way to consumer products. These were the opinions of participants in a panel discussion on new directions for the chemical industry last week in Cleveland, Ohio, at a meeting of the Commercial Chemical Development Association. Keynote speaker Patrick Conley, vice president of Boston Consulting Group, told attendees that the period during which society hardly ques tioned the achievements of science and technology is over. After World War II, the Department of Defense, the National Aeronautics and Space Ad ministration, and the Atomic Energy Commission became the predominant government funders of research and development. Now society is severely questioning the judgment of these agencies. The pendulum is swinging away from the "missile gap" and the "space race" toward such concerns as environmental quality, economic op portunity, and consumerism. The R&D man has fallen from grace. His activities and resources will be closely controlled, his independence strictly curtailed, Mr. Conley says. Marketand society-oriented research will be the order of the day. Heavy govern ment sponsorship of R&D will con
tinue, but with new directions. And companies that ignore the shift will suffer, he adds. Companies already afoul of govern ment and public opinion—detergent makers, for example—should acquire the attitude that environmental con siderations create demand for new products, says Edward Lipinsky of Battelle Memorial Institute. He sug gests that detergent makers think in such starkly innovative terms as de velopment of a total-recovery dry cleaning system or even an ultrasonic cleaning system that would do away entirely with the present aqueous washing system, instead of just replac ing phosphates in detergents with something else that would go down the drain into the water supply. Along with Dr. Lipinsky, Patricia Noble and C. H. Kline of C. H. Kline & Co. espouse a total systems ap proach to marketing chemicals. Their prescription for profit is: Get into proprietary positions with innova tions, formulated specialties, end-use know-how, high service, and advertis ing and promotion. Get into con sumer products. Develop complete systems—chemicals plus equipment. Diversify. Is the age of the marketing man in the chemical industry—as definer of problems, projects, and products, and gadfly to R&D—finally arriving? Cer tainly, the lack of marketing savvy—or at least failure to use available talent profitably—does appear to be a major deficiency of the chemical industry.
Consumer products are generally more profitable... Rank
Product
Return on
net worth (1969) 1 2 3 4 5 10 12
Soft drinks Drugs and medicines Instruments, photo goods, etc. Soaps and cosmetics Office and computing equipment Autos and trucks Clothing and apparel
21.5% 19.9 18.8 18.4 17.5 13.8 13.4
. . . than their ingredients 21 25 26 27 36 38 39
Petroleum products and refining Rubber and allied products Chemical products Paper and allied products Textile products Iron and steel Sugar
Source:
C. H. Kline & Co.
12.1 11.1 11.1 11.1
8.8 7.6 7.2
One meeting attendee commented that it's ironic that some members at tending a recent chemical marketing association meeting in New York City are suffering the same unemployment woes as the present surfeit of Ph.D. chemists. Perhaps these two groups, he says, with their common plight, could now successfully merge their diverse talents in an already suggested Chemical Earnings Development As sociation (C&EN, April 6, page 18). In the past, the observer notes, com munication between marketing and R&D has all too often amounted to "You make a product and Γ11 sell the hell out of it."
MOON SAMPLES:
Very Old Rock A chemically unique moon rock, re turned to earth by the Apollo 12 astro nauts, may be nearly as old as the so lar system itself, according to scien tists at the Lunar Receiving Labora tory at the Manned Spacecraft Center (MSC) in Houston, Tex. Preliminary estimates place the age of the sample at 4.6 billion years—the oldest rock yet found on the moon. The discovery was disclosed concur rently at Houston and at the 13th an nual meeting of the Committee on Space Research (COSPAR) of the In ternational Council of Scientific Unions in Leningrad, U.S.S.R. Anthony J. Calio, director of science and applica tions at MSC, and Dr. Paul Gast, chief of lunar and earth sciences di vision at MSC, made known the dis covery in Houston. Dr. G. J. Wasser berg of Caltech, Pasadena, Calif., pre sented the findings at COSPAR. The 83-gram specimen (sample 12013) was found to contain 20 times as much uranium, thorium, and potas sium as any lunar rock analyzed to date. The sample has a texture read ily distinguishable from breccia and igneous rock, and color variations on the surface of the sample suggest that it is inhomogeneous. Other rocks from Apollo 11 and 12 appear to have crystallized from an igneous liquid between 3.3 and 3.7 billion years ago. Isotope studies indicate that lunar breccia may be as much as 4.4 billion years old. Sample 12013 appears to be essen tially the same age as most meteorites. The time of formation of stone me teorites is generally thought to be the time of formation of the solar system. Just where the rock came from is not known, but MSC scientists think it might have come from the highlands or from rock underlying the mare. Further studies on the sample by in vestigators in the U.S. and England are under way. J U N E 1, 1970 C & E N
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