Financial Statements - Solvay

Technological leadership through
Research and Innovation.
In certain regions, production
capacities had to be adapted to
falling customer demand.
The Blenheim (Canada) plant was
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closed and the closing of the Nucourt
(France) plant and the resizing of
the other French plants have been
announced. In 2008, 695 positions
had to be eliminated. At the same
time productivity, quality and
safety performance all improved
considerably. Negotiations were
begun with automotive customers to
distribute as well as possible
the intensity and brutality of the
economic downturn.
On the other hand, new plants have
been rolled out or are on the drawing
board in emerging countries:
In China, the Wuhan plant has
begun operations and a second
plant is planned in the Beijing
region;
Preparations are in hand for starting
up the Stavrovo plant in Russia;
A project is under way to build a
plant close to Chennai in India.
Innovation and Research remain key
strategic elements in this activity.
Production of the fuel system for
the new 7-series BMW has started
in Germany, utilizing the innovative
Twin-Sheet Blow-Molding (TSBM)
technology. This techology has
received two awards, including the
Innovation Prize of the Society of
Plastics Engineers (SPE).
At the same time, industrial-scale
production of the SCR system
(selective catalytic reduction of NOx –
nitrogen oxide – emissions using urea)
has begun for the Audi Q7 TDI diesel.
This system meets the demanding
Ultra Low Emissions Systems
(ULES) standards of the California Air
Resources Board (CARB).
The Vinyls cluster:
electrolysis chain, vinyl
chloride monomer, polyvinyl
chloride, PVC compounds
and Pipelife, a 50/50 joint
venture with Wienerberger
in pipes and fi ttings
The Vinyls chain
The global economic slowdown
that started in the United States
developed essentially as had been
anticipated until October. From
then on, following the fi nancial
crisis at the end of the summer,
economic deterioration accelerated
at a scarcely foreseeable rate. Our
earnings, until that point in line with
our expectations, then fell signifi cantly
in every region in which we operate.
During the fi rst three quarters, falling
demand for polyvinyl chloride (PVC) in
Western Europe was offset by strong
growth in Eastern Europe and Turkey.
From November onwards, demand
in Europe collapsed to historically
low levels, due to massive inventory
drawdowns throughout the supply
chain, initiated by falling prices and
the need to conserve liquidity, mainly
downstream from our activities.
In Mercosur, production units at
Solvay Indupa (a quoted Argentine
company in which Solvay holds a
majority interest) operated in strongly
rising markets during the fi rst nine
months of 2008. Production was
reduced beginning in July owing
to maintenance shutdowns at our
Plastics Sector
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Solvay Global Annual Report 2008
Plastics Sector