Business News
DuPont Innovation Addressing Major Global Market Trends
Friday 29. May 2009 - CEO Ellen Kullman Updates Investors on Growth Opportunities in Increasing Food Productivity, Decreasing Dependence on Fossil Fuels, Protecting Lives, Growing in Emerging Markets
DuPont (NYSE:DD) is well-positioned for growth opportunities with innovations that are addressing major global market trends, said DuPont CEO Ellen J. Kullman at an investors’ conference here today. Kullman said the company’s research and development efforts are focused on global needs for increasing food productivity, decreasing dependence on fossil fuels, protecting lives and growing in emerging markets.
“DuPont is a market-driven science company,” Kullman said at the Sanford Bernstein Strategic Decisions Conference. “That simple statement describes us whether we’re at the peak of an economic cycle or experiencing a global recession — innovation is a critical lever at all times for DuPont. Our innovation objectives are focused on key global market trends. These trends provide a compass to guide our research and development on new products, creating opportunities for innovation by DuPont.”
Kullman said 77 percent of DuPont’s $1.4 billion R&D budget is directed at three global “megatrends” of increasing food productivity, decreasing dependence on fossil fuels and protecting lives. With greater emphasis on the execution of its product development efforts, DuPont delivered more than $10 billion in sales from new products that are less than five years old in 2008. In first quarter 2009, DuPont commercialized more than 500 new products to the market — nearly double compared to first quarter 2008.
“Innovation has the potential to better feed the world, address global energy challenges and provide safer and more secure lives for people everywhere. DuPont is pursuing innovations that meet customer and market needs, while providing value for our shareholders and society,” Kullman added, noting that global population growth is the common denominator driving demand. According to the United Nations, the world’s human population has grown from about 2.5 billion in the mid-20th century to more than 6.5 billion today, with projections rising to an estimated 9 billion people by mid-21st century.
Increasing Food Productivity. To accommodate the rising demand for food and dietary protein by the world’s population between now and 2025, global food production will need to double on virtually the same amount of land currently in production, Kullman said.
DuPont, one of the largest producers of soybean and corn seed in the world, is using biotechnology to develop insect-resistant varieties and hybrids to improve productivity, quality and yield and to accelerate breeding and rate of genetic gain. “We expect at least $2 billion in incremental sales to be generated over the next five years, with more to come after that,” Kullman said.
Decreasing Dependence on Fossil Fuels. As economies modernize in emerging markets, Kullman said DuPont is anticipating increased demand for renewable energy sources by developing products and technologies for photovoltaics — with sales expected over $1 billion by 2012 — and advanced biofuels, like biobutanol and cellulosic ethanol. DuPont is also focused on developing more energy-efficient products, including a new generation of DuPont(TM) Tyvek(R) materials with improved performance in weatherization and energy efficiency.
Protecting Lives. “The company’s safety expertise and highly differentiated product offerings position it well to service the basic need for people to feel safe and secure at work and at home,” Kullman said. “We’re working on next-generation DuPont(TM) Kevlar(R) and Nomex(R) products for military, life protection and industrial applications, and we’re coupling the product innovations with a very strong brand franchise. In addition, we are expanding the addressable market to tires, transformers, oil and gas industry needs, and other areas.”
Growing in Emerging Markets. Kullman said DuPont’s sales in emerging markets grew 13 percent to $8.8 billion in 2008. “Innovation plays a key role in our ability to penetrate and grow in emerging markets. As we learn more about the local market, we use our technical service capability to develop products that are tailored to the unique demands of the specific market,” Kullman said.