100 Stories1981 Taking on Light and Strong Carbon Fiber

Carbon fiber is a 21st century cutting edge material that is “light, strong, and corrosion-free.” It is used in everything from car parts to golf clubs. Carbon fiber has 1/4 the relative weight of steel, 10 times the strength, and 7 times the specific modulus, among other outstanding properties.

Carbon fiber production began in 1959 when the American company UCC began selling it using rayon as a raw material. In Japan, companies began to start research in the 1960s, with Asahi Kasei beginning its research in the 1970s.

Although there was a period of time when research was temporarily suspended, the market for sports, leisure, and aircraft applications for carbon fiber grew, and research was resumed in 1979. In 1981, the company established Asahi-Nippon Carbon Fiber Co., Ltd. as a joint venture with Nippon Carbon to commercialize the product.

The initial business plan for commercialization expected to turn a profit in the fourth year, but this was changed to a plan with a deficit at the time of establishment, leading to internal debate as to why the company had entered the market without a profitable outlook.

The management announced that “the most important thing is to produce high quality products, and we approve this proposal as it is in line with these efforts,” so there was an emphasis on R&D rather than commercialization.

In September 1981, five months after its entry into the market, Asahi Composite Co., Ltd. was established as a joint venture with Ciba-Geigy to promote Asahi Kasei’s composite materials business. Asahi-Nippon Carbon Fiber Co., Ltd. also gained strength by increasing its annual production capacity.

However, in the early 1980s, major European and U.S. chemical companies entered the market one after another. In addition, the high Japanese yen intensified competition in terms of both price and quality. Asahi Kasei dissolved the joint venture and changed its name to Asahikasei Carbon Fiber after Nippon Carbon withdrew from the market due to deteriorating performance in its core business.

In 1989, Asahikasei Carbon Fiber also became insolvent, and Shin Asahikasei Carbon fiber was established to take over its business. Asahi Composite was also liquidated when Ciba-Geigy withdrew its investment, and Shin Asahikasei Carbon fiber took over its operations.

As the turbulent 1980s turned into the 1990s, global demand for carbon fiber grew and market conditions recovered. Demand for sports applications, such as golf clubs in the U.S., also showed remarkable growth. Asahi Kasei decided to continue its carbon fiber business based on the prospect that it would become a major material in the 21st century and the market would expand. Further development efforts were made, and the annual production capacity was increased from 180 tons at the time of entry to 580 tons per year.

However, the rapid growth in demand for golf clubs in the U.S. prompted Taiwan's growth as a production base for sporting goods, and price competition became even more intense. Asahi Kasei was unable to enter the aircraft application market, and thus became embroiled in fierce international competition in the sports market.

In the 1990s, the Cold War ended and military applications were eliminated, leading to a worldwide reorganization of the industry. As a result, many Western companies that entered the market in the 1980s withdrew from the market.

In January 1994, Asahi Kasei finally decided to withdraw from the industry. Production was halted in stages from May 1994, and Shin Asahikasei Carbon fiber was dissolved on December 31 that same year.

Carbon fiber is a good material, but competition in the market was fierce. In anticipation of its future potential, Asahi Kasei took on the challenge of developing carbon fiber for nearly 15 years, and during that time, its development capabilities were second to none.