A material presence

The JEC Europe 2015 composites show provided a platform for material technology and supply company Hexcel to brief the press on its current perspective on the advanced, and primarily aerospace, composites market sector and to introduce new product offerings.

Chief executive, Nick Stanage provided his perspective on the current situation of Hexcel as a company and its 2020 vision. General manager, Thierry Merlot gave updates on the major aircraft and industrial programmes and investments, and vice-president for research & technology, Dr Paul McKenzie, introduced the innovations which would underpin much of this.

Stanage describes Hexcel as an advanced composite company focused on markets with long-term growth potential. In 2014, its 5,700 employees turned over some $1.9 billion, with two-thirds of this within civil aerospace, and with a compound annual growth rate over the last five years of 10.9%.

Sustainable and attainable

Stanage defines the Hexcel product offering as: “Providing sustainable competitive advantage as well as solving very complex technical problems for their customers. What do the customers want? Lighter, stronger, more durable materials. That's the definition of composites. They also want new product forms, to make different shaped parts, new efficiencies in processing to make them more effectively and they want more technical performance through innovation.”

Hexcel has a unique degree of vertical integration in this market sector, with activities running all the way from the production of the raw material of reinforcing fibres (carbon fibre production in US and Europe), making this into structural reinforcement through weaving plants, pre-impregnating both carbon and glass fibre materials, and the honeycomb materials that allow the engineered products division of the company to make finished helicopter rotor blades.

The 2020 vision is for the present growth rate to continue, and for a 50% increase to $3bn of sales with the generation of free cash flow of some $1bn by that time. Priorities for the use of this cash are to support organic growth, investing in R&T and capacity to support the expected growth in demand, as a return to shareholders and to fund opportunities for mergers and acquisitions, for reasons of technology acquisition, adjacent business capability or in bolt-ons to the corporate portfolio that fit the focus outlined earlier.

The vision of growth from one of the composites industry's leading companies has been consistent over many years. Stanage cites over 70 years of corporate history, reaching back to the earliest pioneering days of composites with the post-war formation of California Reinforced Plastics in the US, and the development of Aero Research Laboratories with its Gordon Aerolite, flax reinforced phenol-formaldehyde resin, in the UK.

Thierry Merlot goes on to explain that the Airbus order book is good news for Hexcel, with around $5 million of value to them on each A350 XWB. The 780 firm orders means a current value for Hexcel of just short of $4bn for this programme. Although not quite achieving the 53% of airframe mass demonstrated on the larger aircraft, the single aisle A320neo is still set to deliver a very significant $450k of shipset value of Hexcel prepreg, resins, adhesives and honeycomb materials.

Great leap forward

The expanding use of composites in propulsion is characterised by CFM's LEAP-1 engine which will power the new class of single aisle aircraft: Airbus A320neo, Boeing 737MAX and COMAC 919. In 2013, Hexcel was awarded the long-term contract by Safran to supply all the carbon fibre for fan blades and containment cases.

$250m will be invested in new capacity to support expansion in the European demand for carbon fibres in the PAN precursor and carbonisation line at Roussillon, to be fully operational in 2018 and complementing the existing weaving and prepreg manufacturing facilities further up the Rhône valley near Lyon.

So Merlot confirms that the company is intent on consolidating its leading position. Against a landscape of double digit organic growth for the use of composites within the aerospace, wind power and transportation markets, plus needing to achieve greater presence in the manufacturing of composites parts through JVs such as its joint ownership with Boeing of the Malaysian company Asian Composites Manufacturing (ACM Sdn Bhd) and the recently announced acquisition of 50% of non-crimp fabric manufacturer, Formax.

Dr McKenzie outlines the priority which is placed on the generation of innovative technology, with advances in the performance of RTM resin, heat shielding and acoustic honeycomb core, high modulus fibre tows and rapid cure epoxy prepreg. Many of the main Hexcel catalogue products are being tweaked to make it easier and cheaper to use them in the manufacture of high performance composite parts. Within this technology plan is a $10m investment to expand the Duxford R&T Centre. The Centre's expansion was announced late last year and is due to open in 2016.

Significantly, there is also investment in the development of automated preform production technology with innovations in the areas of integrating additional materials such as adhesives, in-line quality inspection and automated packaging which is taking Hexcel well beyond the point of simple materials supply.

End to end fulfilment

At one level, the picture presented by the company seniors is just business as usual for Hexcel, with steady corporate growth on the back of the expanding composites market and a range of incrementally developed materials products demonstrating higher stiffness, lower curing temperatures, increased damage tolerance, and cheaper production. There is a stronger story underneath this though, of an already vertically integrated material supplier who is in a position to meet their customers at least halfway along the composites value chain from raw materials to finished parts. The critically important part which Hexcel plays within the materials engineering and logistics chains for many of its key customers such as Airbus - and the growth intentions expressed by senior management - would suggest that the hand-off point in this relationship might be developing. This is an area that through organic growth as well as mergers and acquisitions, Hexcel may play a greater role in the production of composite parts from the material they already supply.

The whole composites arena is characterised by being partnership rich, with many players intensely involved in recurring and non-recurring activities within the triangular material/process/product relationship. In the early days, and as with so many emerging technology sectors, the pioneers had to do it all themselves so there are precedents for the level of vertical integration that Hexcel is steering towards. Pics: Nick Stanage (top) Thierry Merlot

www.hexcel.com