BASF unveils company-wide restructuring; to expand China operations

By PharmaCompass

2018-11-29

Impressions: 114 Article

German chemicals giant BASF has unveiled a company-wide reorganization in a bid to hike profits by US$ 2.3 billion annually by 2021. BASF also aims to increase annual sales of products it claims make a substantial contribution to sustainability to US$ 25 billion by 2025.

The company’s reorganization will involve moving its 11 business units into six divisions. The company will also simplify structures and processes, sharpen its portfolio, and better align its businesses to its customers. “We will transform our organization to be more agile and customer focused,” BASF Chairman Martin Brudermüller said.

As part of its restructuring, the firm aims to enhance efficiencies in production, logistics, and R&D. This will include moving some of the firm’s centralized R&D activities into business units. Other planned changes include the wider use of digitization and automation. The firm will invest significantly more in efficiency improvement — at about US$ 460 million per annum. The firm plans to digitize processes at more than 350 of its plants around the world by 2022.

BASF would also expand its operations in China. “We want to generate growth where growth is actually happening,” Brudermüller said.

China is the world's largest chemical market, with a market share of 30 percent, and drives the growth of chemical production. “By 2030, China’s share will increase to nearly 50 percent, and we want to participate in this growth. Our new Verbund site in Zhanjiang, Guangdong Province and the expansion of the site in Nanjing will significantly enhance our growth in this dynamic market,” Brudermüller said.

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