Ahlstrom-Munksjö produces and develops energy efficient filtration materials from natural or synthetic fibers or a combination. Awareness of air pollution is rising fast, which generates demand for solutions, especially from markets such as China and Brazil. For filtration materials, the largest customer segment is the automotive industry, where demand was strong due to growing sales of new cars and an expanding global fleet of existing vehicles.
Around 80 percent of filtration sales derive from the transportation sector. Heavy machinery and trucks used in industry, mining and agriculture account for 60 percent, passenger cars for 30 percent and the remaining 10 percent for the industrial sector. For Ahlstrom-Munksjö, sales come primarily from the after-market. In total, the market for filtration materials is growing by between 2 and 3 percent per year, and in 2017 Ahlstrom-Munksjö clearly outpaced the general market growth.
Although the shift to electrical vehicles is starting to happen, it will take considerable time and the new type of vehicles will also need a substantial amount of filter material, particularly because demand for cleaner cabin air is rising quickly. Less than 10 percent of sales come from new passenger cars.
Stricter emission standards also support the market for new filter media and will continue to do so as hybrid vehicles, which include a combustion engine, are expected to be the prevailing type of vehicle in the next decade or two.
In addition, e-mobility and electric vehicles offer new and exciting opportunities for Ahlstrom-Munksjö to expand into sectors where we do not operate today. New filters, for example, are being developed to be used in cooling systems for batteries and hydraulic systems used in electric cars.
To meet strong demand for engine and industrial filter media, Ahlstrom-Munksjö decided to invest in additional capacity at its Turin plant, which came on stream early 2018. This new capacity, together with the earlier investment in Madisonville, Kentucky, will enable Ahlstrom-Munksjö to meet a rising demand for high efficiency filter media in transportation as well as expand into new applications in industrial filtration.
Nonwovens are made from chemically bonded, randomly dispersed fibers. They are used in fabrics for laundry care suppliers, automotive and construction material suppliers, wallcover printers and flushable wipes manufacturers. Demand in 2017 was stable in most of these segments, and around 35 percent of sales were generated by wipes, which are sold in bulk to a few selected buyers.
A shift towards dry construction techniques is driving demand for wet plaster board in construction, while stricter guidelines and labelling systems spark demand for truly flushable products in the apparel segment where Ahlstrom-Munksjö has a very competitive offering.
In wallcovers, Ahlstrom-Munksjö’s shift towards more highvalue products is continuing with the digital print wallpaper segment growing steadily. New products like Spray-Up, where the wallcovers can easily be taken down and changed, are catching on in markets where temporary rental homes are more common, like North America.
Ahlstrom-Munksjö’s glass fiber products are aimed at flooring and wind turbine manufacturers. Increasing demand for luxury flooring, a technology shift that favors laminated flooring products and a shift to glass fiber are fueling demand for Ahlstrom-Munksjö products, especially in North America and Russia where our market positions have strengthened considerably.
The wind turbine market was stable to weaker in 2017 with reduced subsidies impacting demand later in the year.