After stalling out, will SMC recycling revive?

When North America's first and only commercial recycler of sheet molding compound (SMC) closed its doors last April (see PT, May '96, p. 70), it threw into doubt what had been a promising program for reclaiming automotive thermosets. The demise of Phoenix Fibreglass Inc. of Oakville, Ont., illustrates how difficult it can be to establish a brand-new recycling "loop" - even when all the players in the loop are in place and when the venture is backed by an established materials supplier.

Although Phoenix Fibreglass no longer exists, proponents still say that the concept of SMC recycling is sound. At least the Phoenix experience demonstrated the technical feasibility of using reground SMC as filler in new molded parts and resulted in several such parts appearing on commercial vehicles. (The first automotive part containing SMC recyclate was the rear inner panel on the 1993 Corvette.) Some companies are continuing to pursue the technology but with a different approach that may yet make recycled SMC filler fully cost competitive with virgin calcium carbonate.

A COOPERATIVE EFFORT FAILED

Phoenix Fibreglass, of course, couldn't succeed without the other elements in the recycling loop. Its partners were eight SMC molders, who hoped to sell parts containing a percentage of recyclate to their automotive OEM customers. Another key partner was Owens Corning of Toledo, Ohio, which purchased a minority stake in the enterprise and took control of its management in 1994. However, the auto companies that were to be the ultimate customers for the recycled SMC never signed on as full partners to the collective recycling venture. Perhaps that was what doomed it to failure.

SMC molders and raw-material suppliers like Owens Corning had good reason to support Phoenix's fledgling enterprise. They knew that recyclability was a long-term goal for the auto industry, explains Tom Harth, technical engineer with Eagle-Picher Industries, Grabill, Ind., and chairman of the technical committee of the SMC Automotive Alliance, Troy, Mich. Ford Motor Co. had even set a target of 25% recycled content for its cars. Sensitive to efforts by thermoplastics suppliers to make recyclability a competitive issue in Detroit, SMC advocates had been investigating various ways to recycle SMC components since 1988.

Formed in 1991, Phoenix Fibre-glass was an entrepreneurial company that by mid-1994 was near closing because it had failed it its solo efforts to establish a place for automotive SMC recycling, says Jack Jenks, Owens Corning's v.p. of composites and former CEO of Phoenix. To make the recycling firm self-sustaining and marginally profitable, Owens Corning devised a business plan in which SMC recyclate would be separated into three components - filler, chopped strand, and milled fiber. Sale of the higher-value glass fractions would be used to subsidize the PHX recycled filler and make it cost-competitive with virgin calcium carbonate.

Although the SMC molders planned to use only the filler fraction, the linchpin of the plan was to develop markets for all of the recycled products. Owens Corning asked the participating molders to subsidize Phoenix for a period of two years, during which time Owens Corning would develop markets for the glass fractions. PHX filler had an estimated market value of 8-10[cents]/lb, a price calculated to make the recycled filler equal in value to virgin calcium carbonate. Each of the participating molders signed two-year agreements with Phoenix, in which they committed to supply a quantity of scrap and accept a quantity of filler at 18[cents]/lb. At the end of the two-year period, after markets for the recycled glass-fiber fraction were to have been established, Phoenix promised to drop the price of PHX filler to 8-10[cents]/lb.

1996 AUTOMOTIVE PARTS WITH RECYCLED SMC CONTENT

Company    Model               Part

Chrysler   Ram Van             Interior trim
           Neon                Spoiler (first Class A exterior
part)
Ford       Econoline Van       Engine cover
           Windstar            Grille-opening reinforcement
GM         Corvette            Rear inner panel, door inner
                               panel, dash panel, cowl plenum,
                               hood inner panel, underbody front
Navistar   3/4000 Series       Front fender extension
           medium-duty truck

Source: SMC Automotive Alliance

Eighteen months into its business plan, Phoenix shut its doors. According to Jenks, six months prior to that, three of the molders - including two of the largest in the country - informed Phoenix that they were no longer willing to take any more filler. Phoenix, which realized that there was no way to continue operations without the participation of all major SMC molders, tried to convince them to stay within the fold. The effort failed, says Jenks, and Phoenix shut its doors because it ran out of money.

NO INCENTIVE TO RECYCLE

In the end, Phoenix was simply not able to develop enough interest for its products fast enough, say those who were directly involved. A few molders have suggested that Phoenix closed because it wasn't successful in developing markets for its recycled glass fibers. Jenks disputes this. He insists that Phoenix had turned the corner in developing what he broadly terms "transportation applications" for the glass fractions. "When Phoenix went down, we were at a point where we were selling enough glass fractions that would have kept Phoenix totally viable."

In his view, Phoenix failed because of the filler side of the equation. "The molders had huge inventories of filler because they hadn't been able to work with the car companies and get approved applications," he says. Jenks explains that though PHX filler was technically acceptable as a substitute for calcium carbonate in automotive SMC parts, and it did not cost any more than the standard filler, the recyclate did not offer the price advantage that automotive engineers were looking for. Sources at Ford, GM, and Chrysler say they have no internal mandate that their engineers must use recycled material. The consensus at the car companies is that SMC recycling will turn on its economic viability. But apparently it's not enough for recycled product to be equal in cost to virgin - it must be lower in cost to be attractive. Chrysler, however, streamlined its approval process by encouraging its engineers to use as much SMC recyclate as they wanted, as long as it met technical requirements, says John Fillion, Chrysler's manager of organic materials.

So far, auto makers have resisted the idea of giving rebates to molders for including SMC recyclate in their parts, according to Harth, who says he has pitched the idea to car companies repeatedly. He says the lower specific gravity of PHX filler can provide vehicle weight reductions at relatively low cost to help meet fuel-economy standards.

WHERE TO NOW?

Several of the molders who were involved with Phoenix are now working with R.J. Marshall Co., Southfield, Mich., a specialty filler supplier. Marshall has acquired some milling machinery and testing equipment from the defunct Phoenix plant. From its existing lab and pilot plant in Detroit, Marshall is now supplying test quantities of recyclate to selected molders. Unlike Phoenix, Marshall is making no attempt to separate the glass from the filler. Owner Richard J. Marshall says his objective is to establish a profitable operation with a filler that is cost competitive with calcium carbonate on an equivalent weight basis.

According to Jenks of Owens Coming, automotive engineers require an incentive to push for inclusion of recycled material in their parts. "Unless the car companies do a better job of mandating through their organization, recycling of SMC will fail again in the future." He sees a need for car companies to say to their platform engineers that recyclability is an important enough reason to work aggressively with molders to approve parts based on these materials. Says Jenks, "If they don't do that, it won't happen."