Dow Announces Next Phase of Comprehensive Investments to Deliver Long-Term Competitive Advantage and Earnings Growth
May 11 2017 - 10:23AM
Business Wire
- Additional projects extend U.S. growth
investments to more than $12 billion over 10-year period
- Fuels domestic job creation and
economic activity; multiplier effect leads to ~2,000 new,
high-skilled U.S. jobs tied to state-of-the-art manufacturing
- Projects underscore Company’s narrower
and deeper focus in attractive, consumer-driven end-markets around
the world
- Integration advantage further bolstered
by expanding Texas ethylene cracker to become the world’s
largest
The Dow Chemical Company (NYSE: DOW) today announced its next
phase of comprehensive investments over the next five years to
further enhance its competitive advantage and deliver earnings
growth. These investments will stimulate economic activity,
primarily in the United States, while also creating a significant
number of jobs tied to state-of-the-art manufacturing and
infrastructure investments. The Company also continues to
accelerate its efforts to train and educate the workforce and close
the skills gap for tomorrow’s manufacturing careers.
“Today’s announcement underscores Dow’s commitment to driving
the next phase of our growth through a comprehensive set of
investments that will benefit our shareholders, customers,
employees and the communities in which we operate,” said Andrew
Liveris, Dow’s chairman and chief executive officer. “Manufacturing
plays a vital role in driving economic growth and prosperity across
virtually all sectors of society. The positive investment
environment in the U.S. chemical and materials sector, driven by
competitive feedstocks and a skilled workforce, is a driver for Dow
to further invest in the USA.”
The projects announced today extend Dow’s U.S. growth
investments to more than $12 billion over a 10-year period and
are expected to employ approximately 5,500 workers at peak
activity, as well as 300 permanent jobs. Investments in the United
States will support the largest job creation, reaching
approximately 3,500 construction jobs and 200 full-time technical,
vocational and professional careers. The job creation is also
expected to have a multiplier effect, supporting additional
employment of nearly 2,000 jobs across the broader economy(1).
“The Trump Administration seeks to drive structural economic
reform across the regulatory and tax environments, fair trade and
job creation – envisioning an economy that motivates U.S. business
to once again focus on domestic growth and restoring America’s
long-term competitiveness,” added Liveris. “Dow’s announcement
today, as well as our U.S. investments over these past many years,
align with this thesis and position our Company to continue
strengthening the manufacturing sector and the many industries it
supports.”
The investments announced today are expected to come online in a
phased manner, beginning in 2020 and will require estimated capital
expenditures of approximately $4 billion, spread over the next five
years. The primary components of this plan include:
- Expansion of the capacity of Dow’s new
TX-9 ethylene cracker through the addition of two furnaces,
bringing the facility’s total ethylene capacity to 2 million metric
tons and making the TX-9 cracker the largest ethylene facility in
the world.
- Construction of a world-scale
600,000 metric ton polyethylene unit in the U.S. Gulf Coast
based on Dow’s proprietary Solution Process technology. This new
capacity will address consumer-driven demand in specialty
packaging, health and hygiene, and industrial and consumer
packaging applications.
- Dow will pursue a series of
investments to strengthen its Polyurethanes franchise aimed at
driving downstream specialty polyols and systems growth and
infrastructure enhancements.
- The Company will undertake a series
of incremental debottleneck projects across its global asset
network that will deliver approximately 350,000 metric tons of
additional polyethylene, the majority of which will be in North
America.
- Construction of a new catalyst
production unit for key catalysts licensed by Univation, a
wholly-owned subsidiary of Dow, enhancing Univation’s licensing
model.
- Construction of a world-scale 450,000
metric ton polyolefins facility in Europe. This capacity addition
will maximize the value of Dow’s ethylene integration in the region
and serve growing demand for high-performance pressure pipes and
fittings, as well as caps and closures applications.
- The Company will pursue additional
investments to benefit from shale gas economics, further
enhancing feedstock flexibility and reducing volatility from these
advantaged inputs.
- Dow will further enhance its
Pack Studios, the Company’s global network of packaging
experts, equipment and testing capabilities that accelerates the
collaborative development of better packaging. Over the next two
years, Dow will drive several advancements in the U.S. and globally
in polyethylene and adhesive innovations and rapid prototyping,
strengthening the Company’s position as the preferred development
partner for packaging innovation.
- Dow will invest an additional $400
million to support the transformation of its Midland, Michigan
manufacturing operations, enabling further synergies from the
integration of Dow and Dow Corning’s manufacturing operations as a
result of the recent restructuring of Dow Corning’s ownership.
- Dow also recently announced it will
invest in a new, $100 million state-of-the-art innovation
center at its global headquarters in Midland, Michigan. The
center will house scientists and engineers who will focus research
and development activities on advancing solutions for home and
personal care products; broadening Dow’s energy-saving building
technologies; enhancing materials for critical infrastructure; and
driving closer partnerships with automakers as they further
accelerate efforts to light-weight automobiles and develop hybrid,
electric and autonomous transportation solutions.
“These multi-phased investment plans, now spanning over more
than a decade, enhance our unparalleled, cost-advantage integration
and bolster our industry-leading innovation to deliver long-term
growth,” said Jim Fitterling, Dow’s president and chief operating
officer. “Collectively, these growth drivers position Dow – the
world’s leading Materials Science Company – to deliver enhanced
products and technologies for our customers while enabling higher
quality and more consistent earnings growth and cash flow
generation for our shareholders.”
Dow has created more than 10,000 direct and indirect jobs in the
United States in the last four years alone. A significant portion
of that job creation is the result of the Company’s more than $6
billion of manufacturing investments currently underway on the U.S.
Gulf Coast, which employed 7,000 construction workers at the peak.
These investments will create 500 full-time Dow jobs and further
support more than 3,000 jobs in the broader U.S. economy.
Along with the significant job creation enabled by these
projects, Dow also continues to accelerate its partnerships with
leading colleges and technical and vocational institutions to train
thousands of young and displaced workers to deliver the workforce
of tomorrow. One example is Dow’s Apprenticeship Program, which was
recently registered by the U.S. Department of Labor as having
approved National Standards of Apprenticeship, and offers a pathway
to a wide variety of manufacturing careers through both formal
education and on-the-job training. The program currently hosts more
than 500 apprentices and to date has graduated nearly 3,000
apprentices into well-paying jobs. The Company also continues to
attract top-tier talent with advanced degrees to drive greater
innovation and further amplify the value creation of its growth
investments. Since 2010, Dow has hired more than 600 new Ph.D.s and
post-doctorates from the top 20 U.S. technology universities alone.
Today, approximately 35 percent of Dow’s workforce has an advanced
degree.
About Dow
Dow (NYSE: DOW) combines the power of science and technology to
passionately innovate what is essential to human progress. The
Company is driving innovations that extract value from material,
polymer, chemical and biological science to help address many of
the world's most challenging problems, such as the need for fresh
food, safer and more sustainable transportation, clean water,
energy efficiency, more durable infrastructure, and increasing
agricultural productivity. Dow's integrated, market-driven
portfolio delivers a broad range of technology-based products and
solutions to customers in 175 countries and in high-growth sectors
such as packaging, infrastructure, transportation, consumer care,
electronics, and agriculture. In 2016, Dow had annual sales of $48
billion and employed approximately 56,000 people worldwide. The
Company's more than 7,000 product families are manufactured at 189
sites in 34 countries across the globe. References to "Dow" or the
"Company" mean The Dow Chemical Company and its consolidated
subsidiaries unless otherwise expressly noted. More information
about Dow can be found at www.dow.com.
(1) The American Chemistry Council estimates that every job
created from the business of chemistry creates more than 6 jobs in
other sectors across the rest of the economy.
Note: The forward looking statements contained in this document
involve risks and uncertainties that may affect Dow’s operations,
markets, products, services, prices and other factors as discussed
in filings with the Securities and Exchange Commission (“SEC”).
These risks and uncertainties include, but are not limited to,
economic, competitive, legal, governmental and technological
factors. Accordingly, there is no assurance that Dow’s expectations
will be realized. The Company assumes no obligation to provide
revisions to any forward-looking statements should circumstances
change, except as otherwise required by securities and other
applicable laws.
®TM Trademark of The Dow Chemical Company (“Dow”) or an
affiliated company of Dow
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version on businesswire.com: http://www.businesswire.com/news/home/20170511005824/en/
Jarrod ErpeldingMedia RelationsThe Dow Chemical
Company989.633.1863jarrod.erpelding@dow.com
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