Singapore Chemical Additive Manufacturing Facility - Phase II Expansion FAQs

The following questions and answers provide details about Afton’s new Singapore Additive Manufacturing Facility Phase II Expansion.

1. What is Afton’s journey in the Asia Pacific region?

• The Asia Pacific region has been an important part of our business for many years, and Singapore has been our headquarters for this region since the 1980’s.
• In 2008, we intensified our focus in the Asia Pacific region and incorporated Afton Chemical Asia in Singapore. Asia Pacific is an important region to enable growth
  for the company.
• The Singapore Chemical Additive Manufacturing Facility in Jurong island aims to further strengthen our global supply network and support the growth of Asia
  Pacific.
• In 2014, we started construction of Phase I of the manufacturing facility in Jurong Island and completed construction in 2016. Phase I focused on bringing our
  manufacturing capabilities into Asia and integrating them with our blending and distribution networks.
• The Phase II expansion investment was approved in 2015, and is now ready to begin commercial shipment. Phase II focuses on producing key components using
  the most advanced technology, helping passenger and commercial vehicles meet the performance standard of the future.
• The plant has the full capability to produce core engine oil additives that we need for the Asia Pacific region.

2. What is the significance of Afton Chemical Additive Manufacturing Facility, Singapore to Afton?

• The Afton Chemical Manufacturing Facility is the cornerstone of our commitment to customized solutions that are “Made For” and “Made In” Asia. And from its strategic location at the heart of Asia, it equips Afton to meet our customers’ needs. 
• The Chemical Additive Manufacturing Facility in Jurong Island will help Afton: 
  • Develop cost-effective, customized solutions for the region
  • Greatly strengthen our ability to serve our customers worldwide with the shorter lead times and capacity to support their future growth 
  • Connect our capacities globally to support regional and global business continuity
• This will in turn help our customers grow by:
  • Delivering a competitive edge to their markets
  • Reducing lead-times
  • Improving security of supply
• To increase customer support in Asia Pacific, we have established a fuel and lubricant additive technology center in Suzhou, China and a technology center in Tsukuba, Japan. The technology centers provide customers and Original Equipment Manufacturers (OEMs) in Asia Pacific with enhanced technical services, including sample blending, physical and chemical analysis, and performance testing.
• All the facilities will allow us to better support the fast-growing business in Asia Pacific. It will give us the capabilities and expertise to expand our support to customers and OEMs in the region.

3. What components are being produced?

• The facility produces a key ingredient, calcium sulfonate, used in Afton’s engine oil additives. With the Phase II expansion now online, we have the capability to produce additional key components, ashless dispersant and zinc-based anti-wear component, using the most advanced technology to help passenger and heavy duty vehicles reduce carbon emissions.

4. What is the total amount of investment in the Afton Chemical Additive Manufacturing Facility on Jurong Island, Singapore?

• Phase II investment of S$222 million (US$163 million) and Phase I investment of S$158 million (US$116 million) brings the total investment to US$ 279 million.

5. Will there be further expansion plans or Phase III?

• The Singapore Chemical Additive Manufacturing Facility is scalable to allow Afton to grow as demand warrants.

6. Why is the Asia Pacific such an important region for the company’s growth and development?

• The Asia Pacific region is the largest growing market for fuels and lubricant additives. It is driven by the fastest growth in passenger cars and commercial vehicles volumes worldwide. Passenger cars are now equipped with newer turbocharged direct injection engines which translated to more stringent additive requirements. Afton’s key market in Asia Pacific is China and it is the major consumer of passenger cars. China passenger car parc has been growing by over 20 million new cars a year since 2015. China is also aggressively driving their local GB standards to achieve higher fuel economy and reduction in emissions. By 2022 China will have the highest standard globally.

7. What challenges do Afton face in this region?

• One of the key challenges faced is keeping up with the pace of change and development in the fuels and lubricants additive market. The products used in China 6 years ago used to be 8-10 years behind Europe and Americas in terms of emissions and fuel economy standards and now it is leading the market in terms of standards and quality. From a product lifecycle point of view, China’s new passenger cars product lifecycle is around 5 years while in mature markets in Europe and Americas is around 10 years. For product development and marketing, we need to constantly keep track of the trends impacting the market and keep innovating to provide valuable solutions to our customers to help them grow and address these challenges. 

8. Can you tell me more about the company’s ‘Made for Asia’ and ‘Made in Asia’ vision for the region?

• The Made in, Made For strategy is Afton’s global strategy to create products based on regional demand and needs. It focuses on producing innovative additive solutions in the region to provide shorter lead time and logistics savings to our customers. 
• Our strategy is consistent regionally: The Made in Asia for Asia strategy is part of our overall Made in, Made For strategy and is built on the intent to understand the dynamics of each individual market and ensure we are developing the correct solutions from a product and service perspective. We constantly keep track of the trends impacting the market and to provide valuable and innovative solutions to help our customers grow.

9. In your industry, workplace health & safety and environmental sustainability are paramount - what is Afton doing to uphold each of these policies?

• The people-focus and safety-first culture is one of the fundamentals of how we run our business.
• We implemented the Responsible Care® program globally to commit to conducting all operations in a manner to protect our employees, communities, and environment. It complies with all applicable laws and regulations to reduce environmental impacts. 
• We have also launched the “Actively Caring” safety program where people look out for the safety of others with the pursuit for a zero-incident workplace. We have a strong track record in safety and this is from a focused effort from all our employees.
• The Singapore Chemical Additive Manufacturing Facility is the first manufacturing facility to integrate the three Quality, Environmental and Occupational Health and Safety Assessment, ISO9001, ISO14001 & OHSAS18001 into one Integrated Management System.

10. What are the short and long-term goals for the company in Asia?

• Our ongoing focus in 2018 will be to continue developing key talents, ensuring profitability and growing volume. We will continue to focus our investments in people, technology, technical centers and production capacity to expand the capabilities around the world. This focus will improve our ability to deliver the goods and services that our customers value.
• We constantly look to drive out waste by improving our business’s internal processes. These improvements help us to respond to customer requests and provide fast, effective solutions to their problems.
• We will also increase our localized solutions delivery, whether it is from a supply, marketing or technology perspective.

11. What is Afton’s work culture and business philosophy? How is the Afton team aligned under one vision and mission?

• We have a set of core values that we live by and that are extremely important to us. We put safety first above all else. We operate honorably, and we treat people the way we want to be treated.
• Our culture is flexible, open, and collaborative. It empowers our commercial teams to provide solutions to our customers and for our operations teams to continuously look for improvements in how we deliver the valued services and products to our customers.
• Afton’s business philosophy is based on our Passion for Solutions, our people combined with our know-how on innovative chemistry and providing open, flexible and collaborative support to customers who are looking to deliver superior and differentiated solutions to the market.
• With the right people and values, we also keep our team informed of the strategy, keeping them motivated and empowering them to and encourage a culture of continuous improvement.

12. A sustainable business is backed by strategic partnerships – how do you develop strong mutually beneficial relationships with partners and suppliers?

• Afton adopts a collaborative approach with our strategic partners. Integrity, honesty and transparency are key values that underpin how we work with each other, our suppliers and our customers.
• We take a long-term view, to work together with our partners, to identify new mutual growth opportunities.

13. What are Afton’s views on eMobility?

• eMobility is on the horizon for the automotive industry and will bring about impacts to the fuel and lubricants industry in the next 10-15 years.
• We expect Electric vehicles to grow, mainly due to government policy. We also expect Internal Combustion vehicles to continue to grow, but at a slower rate.
• Internal Combustion powered vehicles will continue to become more efficient with a smaller carbon footprint. Our fuel and lubricant additives are part of the solution. Our additives will continue to help the auto industry reduce emissions, improve fuel economy, and extend the useful life of fluids and equipment.
• Afton is proactively working with key OEMs to develop the technology and lubricant needs and the product lifecycle development process of the electric /hybrid vehicles.