TiPMC still considers the Chemours’ goal of US$500M in base cost reduction plus EBITA from new products to be a difficult challenge.
Some key points have to be explored to fully understand the implications of the cost reduction plan:
• R&D would nearly grind to a halt.
• Only large payback programs would be justified.
• Plant assistance would be limited.
• Ability to develop and promote new products would be curtained.
• Chemours would become a true commodity chemical company.
TiPMC still considers the Chemours’ goal of US$500M in base cost reduction plus EBITA from new products to be a difficult challenge. The ultimate success likely depends on the results of the work to decide the fate of the four remaining chemical solutions businesses and the ability to shed businesses losing EBITA and the overhead costs associated with those businesses in the Chemours portfolio.
• We believe cost reductions in TiO2 and fluoroproducts will affect the ability of those businesses to meet stated growth goals.
• Cost will likely win out. That, in turn, will damage the ability to retain quality people and limit the company’s ability to move forward with progressive programs.