Now part of Lanxess Group, Rhein Chemie remains closely tied to these three specialty markets. Lube oil additives account for about 20 percent of its sales, and its current focus in the lubricants segment is developing high-performance esters, phosphorus and sulfurized lube additives as alternatives to chlorinated paraffins.

Using light-colored sulfur carriers, Rhein Chemie was able to replace chlorinated paraffins, first in Western Europe and then in other regions. Although widely used, short-chain chlorinated paraffins had posed toxicological and environmental concerns. The company was successful in establishing this chlorine-free technology in the market and expanding its market share.

We supply light-colored, low-odor sulfurized additives based on sustainable raw materials, said Philipp Junge, the lubricants divisions executive vice president, in Mannheim. They provide the perfect offsets for chlorinated paraffins in lubricants.

He went on to explain that Rhein Chemie offers a broad range of components and packages sold under the Additin brand, for industrial lubricants including hydraulic, turbine, compressor, gear and multipurpose oils. Metalworking fluids and lubricating greases are also key markets for its lube additives, which are formulated to improve extreme-pressure properties under boundary lubrication conditions and provide antiwear performance, steel corrosion protection, yellow-metal protection, and oxidation resistance.

Getting to Here

The companys U.S. presence dates to around 1971, when Rhein Chemie became a subsidiary of the German chemical giant Bayer AG. Bayer soon acquired Wyrough & Loser to form the basis of what would become Rhein Chemie Corp. in the United States. Elsewhere it expanded with production in Japan in 1990 and establishment of a laboratory and production facility in Qingdao, China, in 1999. The latter facility, initially centered on rubber chemicals, became the springboard for launching Additin products into China.

In late 2005, Bayer spun off nearly a score of its chemical businesses, includ-ing Rhein Chemie, to form Lanxess Group. Lanxess since has streamlined into three major divisions with 13 operating companies. It also busily expanded Rhein Chemies international presence, opening one lubricant additive production facility at the Qingdao site in 2008, adding more production capacity in Mannheim, and acquiring Darmex S.A. in Buenos Aires, Argentina.

Today, Junge explained, Rhein Chemie is present in nine countries with 11 production sites and over 1,100 employees, so we are a significant part of the Lanxess family. The company generated over 300 million in sales in 2011 from all its product lines, and has enjoyed strong sales growth over the last several years, he said.

Building in the U.S.

Rhein Chemie has identified three growth strategies for the U.S. and North America. First, it aims to strengthen its sales and marketing team to engage customers more directly. Hand-in-hand with this, the company wants to increase its technical capabilities. Third, both Lanxess and Rhein Chemie are looking at external growth opportunities. We want to strengthen our core industrial additives business, said Junge, who is based in Mannheim.

Our claim to fame is that we understand our customers problems and have a solutions engineering approach that requires a lot of technical resources, including people and laboratories, added Junge. I feel what sets us apart from some of our competitors is that we dedicate significant technical resources to solving our customers problems.

A major part of Rhein Chemies growth is being seen in the NAFTA countries. We have always had a presence in the region, including an additives manufacturing site in Chardon, Ohio, said Michael Assaf, director of lubricant oil additives for North America. But there is now a definite focus to grow in North America. We have added technical sales people and other technical staff.

To bolster this effort, the company opened a new laboratory in Pittsburgh in January. The most appealing thing about Pittsburgh is the fact that it is already the home of Lanxess U.S.s headquarters, and there is already a state-of-the-art infrastructure in place, Assaf told LubesnGreases.

The center, which the company sees as a cornerstone in its development of next-generation lubricant additives, can offer customer support such as fluid testing, analysis and troubleshooting. The Pittsburgh site also houses a regulatory department to focus on U.S. regulatory issues.

These efforts are critical, said Assaf, who is based in Pittsburgh. Rhein Chemie has always been known as a technology leader, and we need to keep advancing our market offerings. Therefore, we hope to develop new products to both meet and exceed the needs of the North American market.

The addition of this larger lab gives the company regional lubricant additive technology centers in China and the United States, anchored by a global technology center in Mannheim. The placement of labs in Germany, the U.S. and China shows our commitment to these markets, said Assaf. They provide technical resources close to the customer.

We are working toward growth in North America, and we are focusing on developing our entire portfolio, he continued. In the U.S., Rhein Chemie has been best known for sulfur based EP additives. But as part of our growth strategy, we now offer the entire product portfolio. And it has been well received.

Approach in Asia

Although Rhein Chemie Rheinau GmbH is rooted in Germany, it is increasingly becoming an international organization with significant presence in Asia, commented Junge. This trend will continue as we see our major accounts moving toward Asia and shifting some of their capacity there.

As part of its Asia-Pacific strategy, the company recently made structural changes to its team and organization in India and China. The company serves these markets with a direct sales organization supported by commercial and technical resources. While a large part of its business derives from multinational customers from Germany and elsewhere who have set up shop in these countries, Rhein Chemie is also developing relationships with Asias domestic companies.

We have a significant sales team on the ground, Junge said, and we added a sales manager in October 2011 to call on internationals and major companies. In these lubricant markets as well, Rhein Chemie is known primarily for EP additives, and is developing packages to meet the needs of local markets.

We have established a lab in China with a strong technical team, said Junge. This lab has taken on the role of global R&D for water-miscible fluids, and is creating local recipes to fit the needs of those markets.

We opened the lab in China in 1999 and the lubricant additives plant in 2008, said Junge. It looks and operates like a European plant. And we have been able to retain most of the staff, something unusual in China.

Regulatory Hurdles

As with all companies based or doing business in Europe, Rhein Chemie has spent a lot of time in recent years dealing with the ramifications of REACh, Europes chemicals registration program, plus the Global Harmonization System (GHS) for product labeling and local interpretations of that system. Complying with these regulations has kept our health, safety and environmental group very busy, said Junge. But we have the advantage of being a European company with a strong backward integration into Lanxess and all their resources.

He explained that Rhein Chemie and Lanxess identified REACh as a challenge early on, but also an opportunity, and committed significant resources to it. This gives us an edge over non-European based suppliers because we learned REACh and GHS language quickly.

The company has a dedicated REACh team for the lubricants segment that does nothing but look at registering substances to meet the 2013 to 2018 deadlines. Unless these chemical registrations are completed on time, products risk being prohibited from sale in the European Union. Obviously, REACh is a lot of work, especially considering the 2013 deadline, Junge added, but we feel confident we can cover all the requirements that customers will have for us.

Junge explained that the effort has not required a great deal of reformulation. We have been able to register substances for our main products throughout the supply chain. There may be more reformulation as we approach the 2013 deadline. But it will always be done together with customers so there will be no surprises.

Im pretty sure you will see some of the Indian or Chinese companies who supply Europe will not register themselves or will leave the business. REACh is complicated, lets face it. Its been a headache to everyone, Junge concluded, but I believe it offers opportunities to us.