Fuchs Plans to Expand

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Fuchs Plans to Expand

Following a strong fourth quarter and 2017, Fuchs Petrolub SE plans to focus on investing in China, the United States and Germany during 2018, the company stated in its annual report released last week. After opening several new facilities throughout 2017, the independent lubricant blender plans to open more over the next few years.

Sales revenue for 2017, originally listed in a February provisional report, jumped 9.1 percent to almost 2.5 billion (U.S. $3.1 billion). The 9 percent organic growth in sales revenues shows that our growth initiative is increasingly taking effect. We have grown substantially, in particular in China and the U.S., said Stefan Fuchs, chairman of the executive board, in a letter to shareholders.

Photo courtesy of Fuchs

Fuchs’ Chicago grease plant is part of the company’s “3C” commitment, in which Fuchs seeks to offer identical greases for original equipment manufacturer customers across three continents.

Sales revenue also increased during the Mannheim, Germany-based companys fourth quarter to 611 million, up 8.4 percent from the same period of 2016. During the fourth quarter, European sales grew 10.7 percent to 373 million. Sales revenue for the quarter increased almost 12 percent to 189 million in Asia-Pacific and Africa, and increased 2 million in North and South America to 91 million.

Fuchs is expanding laboratory and storage capacities at its two plants in Germany. The new test facility in Mannheim has increased research capacity considerably, the annual report noted. Additionally, the company is also constructing a plant in Sweden that will be completed in a few years and take over production at its currently rented facility in Stockholm.

The lubricant producer also opened a grease plant in Johannesburg, South Africa that produces a diverse range of greases to meet the rising demands of customers in the country. The company is also increasing grease production at its Melbourne, Australia facility, which is expected to be completed in July or August of this year. This expansion comes shortly after the company opened its lubricants blending plant near Sydney.

In the U.S. the company dove further into the grease business by opening a $26 million grease plant, research lab and warehouse outside of Chicago in Harvey, Illinois. Fuchs plans to grow into the electric mobility market in North America, particularly as the need for specialty greases in electric cars increases. With our highly advanced technology, we will soon be able to offer our customers a great deal in this area, the report claimed.

A new Fuchs lubricants plant in Chinas Wujiang district is expected to open in 2019 and will be one of the most modern lubricant production facilities in the country, the annual report claims. The 36 million facility will have a nominal production capacity of about 100,000 tons per year, nearly twice as much as the companys Shanghai facility.

The core areas for 2018 are China, the U.S. and Germany. We are also monitoring the market and will play an active part in market consolidation – if opportunities arise, said Stefan Fuchs in a letter to shareholders.

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