AK and FFG honour Borealis – innovation is the driving force for success

For its success in research, Borealis' Central European operations were honoured this week by Arbeiterkammer (AK) and Österreichische Forschungsförderungsgesellschaft (FFG) as the best company in Lower Austria for the initiative "Arbeitsplätze durch Innovation" ("Employment through innovation"). This Austrian-wide competition awards companies for outstanding effort to create and secure jobs through research and development (R&D). "With this initiative, we want to demonstrate the positive effects on the job market that innovative companies with highly skilled personnel create," said AK Niederösterreich president Josef Staudinger at the ceremony. "Innovation is the motor for business success. It ensures value creation in Austria and contributes strongly to create and protect jobs," stated FFG-CEO Dr. Henrietta Egerth.

Value creation through innovation

Borealis Central Europe, comprising the production location in Schwechat (Austria) as well as the Innovation Centre in Linz (Austria) and a plant in Burghausen (Germany), has approximately 830 employees, and an export rate of around 88%. "We consider innovation as the key to success," said Thomas Abel, General Manager Borealis Central Europe. "We want to be the leading provider of innovative, value creating plastics solutions and supply our customers with products tailored to their needs."

Creating tailor-made plastics solutions

As an example of Borealis' strategy to create value through innovation, Thomas Abel names a new polypropylene (PP) product that was introduced to the market last year and is a milestone in the application of plastics: @The challenge to use PP for the first time in very low density soft foams came from customers in the automotive and packaging industry. The solution, Daploy High Melt Strength (HMS) PP, was provided by R&D and production teams from Borealis in Linz and Schwechat."

The new product family offers an alternative for polyurethane, polyethylene (PE) and PVC foams while combining the outstanding processing properties with the environmental advantages and very good recycling characteristics of PP. Daploy HMS-PP meets the wishes for a high-performance soft foam, for example in cars' seats and head rests for the automotive industry, and sport shoes or security packaging. For PP, it opens a wide range of applications, as the market for PP foams grows impressively; by approximately 22% per year. The Borealis plant is the only production plant for HMS-PP in Europe, the main markets are Germany, Italy and Scandinavia.

"Innovation is an important force for a company's business success," is the guiding philosophy of the AK/FFG initiative. For this, Borealis' success is an impressive example: The 2005 Borealis Group results published recently state a return on capital employed (after tax) of 12%, sales revenues of EUR 4,814 billion; despite a challenging economic climate Borealis had a net profit of EUR 226 million.

Borealis operates in more than a dozen countries, and has around 4,500 employees of which about ten percent work in R&D. In the past year, Borealis secured 198 patents for technical developments, production procedures and new products, an additional 187 innovations are recorded for patents. In 2005, 63 new products were launched. Right now, the main topic for research is to combine diverse plastics' properties to be competitive in a broad range of (new) applications, for example, durability with easy processability, light weight with high stiffness, or transparency with good low temperature resistance.

Borealis: a safety leader

Borealis considers workplace safety an important basis for economic success. For its business transformation programme (since 2001) that included a step change in safety, Borealis was awarded the prestigious DuPont Safety Award in the category "Business Impact" in 2005. As a result of the programme, "Total Recordable Injuries" (TRI, accidents per million working hours) at all Borealis' hubs were continuously reduced. In Schwechat, Linz and Burghausen the 2005 TRI frequency is down to 0.7 – compared to an average TRI for producing companies in Austria and Germany of 30.

"The best result ever for Borealis and very satisfying considering that we had an extremely busy year," says Thomas Abel. With an EUR 200 million investment, Borealis in Schwechat expanded to one of the world's most modern and competitive plastics production sites with a PP capacity of 1 million tonnes/year. A new PE plant with a capacity of 350,000 tonnes/year, using the proprietary Borstar technology, came onstream in October 2005; additionally, the capacity of the existing PP plant was debottlenecked by 90,000 tons to 300,000 tonnes/year.

The Arbeitsplätze durch Innovation-initiative is part of the programme "Innovatives Österreich" of the "Rat für Forschung und Technologieentwicklung". Austrian companies that have used funding by FFG were invited to apply for the award. Out of the regional winners, an independent jury will select the Austrian winner. As studies show, funding by FFG has created or secured many thousands jobs within the past years, each and every Euro of funding has led to 24 additional Euros of turnover. Not the least aim is to show that funding R&D plays an important role in enhancing Austria's recognition as an industrial country.

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