Market Overview

SK Chemicals Entering Auto Parts Market with Next-gen PPS

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Introducing world's first chlorine-free PPS that resolves
headlamp haze

Prospects bright for entry into global auto and E&E markets

Initz of SK Chemicals which leads Korea's eco-friendly plastics
industry, is entering the auto parts market with its super engineering
plastic material.

This press release features multimedia. View the full release here:
https://www.businesswire.com/news/home/20180822005241/en/

Initz Co. Ltd., a subsidiary of SK Chemicals (KRX: 285130), has successfully commercialized its ECOT ...

Initz Co. Ltd., a subsidiary of SK Chemicals (KRX: 285130), has successfully commercialized its ECOTRAN PPS (poly phenylene sulfide) compounds in collaboration with Hyundai Mobis, a global auto parts supplier. ECOTRAN is the first material in the global auto industry that addresses the problem of headlamp haze by applying a super engineering plastic to automotive headlamp holders. (Photo: Business Wire)

Initz Co. Ltd., a subsidiary of SK
Chemicals
(KRX: 285130) (CEO Cheol Kim), announced that it has
successfully commercialized its ECOTRAN® PPS (poly phenylene sulfide)
compounds in collaboration with Hyundai Mobis, a global auto parts
supplier. ECOTRAN®
is the first material in the global auto industry that addresses the
problem of headlamp haze by applying a super engineering plastic to
automotive headlamp holders.

Initz
is a joint venture of SK Chemicals Co. Ltd. and Teijin Ltd. of Japan.
The two have successfully developed the world's first chlorine-free PPS
resin.

PPS is an engineering plastic which has been increasingly replacing
metal materials in accordance with the "lightweighting" trend that has
been sweeping the automotive industry for all cars and trucks but
especially for electric vehicles. PPS is considered a super engineering
plastic as it's highly resistant to both heat and corrosive chemicals.
Initz produces PPS resin by using environment-friendly techniques that
generate no byproducts and very few gases and impurities.

Initz's
high-performance PPS
addresses the root cause of "lamp haze," a
chronic car headlight problem. The problem occurs because plastic parts
inside headlamps begin to generate gas when the internal temperature
rises to over 200°C. Upon cooling the gas solidifies and adheres to the
interior of the lamp. The resultant film then undermines light
projection thus threatening the safety of both drivers and pedestrians
during nighttime. Also, the condition not only reduces the performance
of the vehicle but also the appearance and light distribution value.

Lamp haze happens inevitably because plastics generate gas when
subjected to high temperatures. Many global auto parts engineers have
addressed the problem by focusing on the design of the internal
structure of their headlamps as no other solution resolved the
fundamental problem.

A headlamp holder needs to be highly resistant not only to high heat but
also to humidity which is generated due to the temperature gap between
the inside and outside of the headlamp. A headlamp holder must also be
rigid enough so that internal parts are not loosened by strong vibration.

Working closely with Hyundai Mobis, Initz has succeeded in resolving the
lamp haze issue by incorporating glass fiber using specially formulated
resins to produce the new material. Thus the new product fundamentally
addresses all the engineering problems.

The reliability of Initz's PPS was confirmed through a methodical harsh
environment test in which a headlamp of the new material was cycled
(turned on/off) repeatedly for 70 hours straight and 8 test items for 3
months. Hyundai Mobis said it would use Initz's PPS material in all of
its headlamps in an effort to completely eliminate lamp haze.

"This material technology is applicable to products immediately after
being developed and to extend a specific product line without variation,
so Initz' PPS will have a great impact on the market," an automotive
industry expert said.

"We have resolved the troublesome automotive problem of headlamp haze by
utilizing our technology and experience we have gained in developing the
world's first chlorine-free PPS," Initz CEO Hyo-kyung Kim said. "We will
now expand our presence in the global auto parts market through
continued development of materials technology."

Initz is expected to secure a competitive advantage in the global race
for better automotive materials given that its PPS resin has resolved
the haze problem of headlamps, which is one of key parts which determine
the exterior appearance of a vehicle.

* Chlorine-free
PPS
(Poly Phenylene Sulfide)

PPS is Super Engineering Plastic with high performance and weight
reduction which can replace the metal. INITZ's PPS is the world's first
Non-Chlorine and the Eco-Friendly PPS. INITZ's PPS minimizes the
outgassing and impurities by utilizing the technology of neither the
solvent nor by-product (NaCl).

* Light Distribution

The luminous intensity and spatial distribution of the light source.
Generally, it refers to the level of light transmission and diffusion.

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