100 Stories1952 Importing Saran™ technology, and the start of Asahi-Dow

Asahi Kasei's main business originated from a single company. Asahi-Dow was established in partnership with The Dow Chemical to commercialize Saran™ (vinylidene chloride) fiber.

After the war, Asahi Kasei conducted research on both nylon and vinylidene chloride. Among the two options, Asahi Kasei prioritized the commercialization of vinylidene chloride because the company had established its own technology for it, and it was a possible application for chlorine. Using chlorine, a byproduct, as a raw material would enable supply at low cost. Asahi Kasei was also aiming to develop new industrial applications for chlorine.

However, there were many problems that could not be solved in-house, such as polymer quality and spinning technology, and it was necessary to introduce technology from advanced overseas manufacturers in order to achieve commercialization as quickly as possible. As a result, the company proposed a technical tie-up with the U.S.-based Dow Chemical, which had been a pioneer in the manufacture of vinylidene chloride fiber under the trademark Saran™.

As a result, Asahi Kasei and Dow Chemical established a new company, Asahi-Dow, with a 50:50 investment ratio between them. Asahi Kasei invested 200 million yen, and Dow contributed the Saran™ fiber manufacturing technology, Japanese patent license, Saran™ trademark, and know-how for manufacturing Saran™ fiber, all of which had a total valuation of 200 million yen.

Although this was Dow's first overseas joint venture, Asahi Kasei remarked, “We want Dow to give us the technology. Dow will provide the technology, and Asahi Kasei will provide the people and money, so we want to handle day-to-day management on the Japanese side.” Asahi Kasei's proposal was fully accepted.

Asahi-Dow built a manufacturing plant and began production, but the start-up was unexpectedly difficult. In the U.S., Saran™ was being used for automobile seats, but since passenger cars were not yet widely used in Japan, there were not high hopes as far as demand for Saran™ was concerned.

Asahi Kasei therefore decided to focus on fishnets as its main target industry for the time being, but the company faced a series of difficulties in the early days of operations because of unfamiliarity with the processing technology. The company decided to develop the product jointly with Toyo Somo (now Nitto Seimo), a pioneer in this field. In 1955, a product named “Kyokurin” was released.

Although the fishnet achieved a certain level of success, the company failed to develop new applications for it, and it recorded a total loss of 720 million yen in the first three years of operation. Asahi Kasei was forced to bear the entire cost of the project, as per the original contract. However, the Saran™ technology would support the company for more than half a century when the company began selling Saran Wrap™ in 1960.

After the start of Saran™ production in Japan, Asahi-Dow also signed a contract with Dow to introduce polystyrene technology. Demand for polystyrene continued to increase for a variety of uses, including toothbrushes, umbrella handles, belt buckles, and record players.

Despite two oil crises since 1973, Asahi-Dow has been highly profitable, especially in the polystyrene business, and has won a reputation as a good company among the joint venture partners. In the 1980s, however, Dow Chemical's stable management underwent a major change.

As a result of the decline in earnings, the company's market rating also declined, and the company suffered a major blow. In order to get rid of its dependence on loans, the company withdrew from overseas operations in Korea, Saudi Arabia, and other countries, and Asahi-Dow was also included in the withdrawal.

In 1982, Asahi Kasei decided to merge with Asahi-Dow. For Asahi Kasei, Asahi-Dow was a concern in the integrated management of the petroleum industry. The new organization restarted the petrochemical business.

Asahi-Dow was the source of Asahi Kasei's major businesses such as synthetic fibers and plastics. The Suzuka Plant, which started out by producing Saran™, was the center of the company's efforts to create products that other companies did not have, and it was a constant struggle. The company's concerted efforts to commercialize high-value-added products paid off, and it became a highly profitable company even during the recession. Without Asahi-Dow's struggle to overcome hardships, Asahi Kasei may not have developed into the company it is today.