We had a pleasant interview with Ali Çalışkan, CEO of Kordsa

We conducted an interview with Ali Çalışkan, CEO of Kordsa, discussing the company's success story. Ali Çalışkan provided information about the Cokoon project.

Could you please tell us about yourself, your education and your professional background?

I was born in 1963 in Samsun. I have a Bachelor's degree in Mechanical Engineering from Middle East Technical University. I joined Kordsa in January 1986 as a Technical Office Engineer, and from then on, I have taken part in significant projects within Kordsa at various positions. I served in different managerial positions and as site operations director for Turkey and Nile Kordsa and played an important role in developing Kordsa's capacity and enhancing market volume in the Asia Pacific region. Between 2010 and 2013, I served as President Director of Indo Kordsa, Kordsa's subsidiary in Indonesia, and as Vice President in charge of operations between 2013 and 2015 at Kordsa. In July 2015 I was appointed Chief Operating Officer of Europe, Middle East and Africa regions. As of April 2017, I have served as CEO of Kordsa.

Could you please tell us how the company has changed from its foundation to now?

At Kordsa we operate in three main industries: tire and construction reinforcement, and composites technologies. In 1973, we entered the tire reinforcement market, which was a brand-new industry in Turkey with giant global competitors. In this field, we now produce nylon and polyester yarn, tire cord fabric and single end cord products in our high-technology facilities. Today, we are the world's leading manufacturer of nylon and polyester yarn, tire cord fabric and single end cord products. Over the years, we became the world's market leader in nylon cord fabric and the third biggest player in polyester cord fabric manufacturing in terms of turnover. To expand our knowledge in resin technology and weaving capabilities to various industries, we entered the composite technologies and construction reinforcement markets.

What are the products and product groups of Kordsa? What are the industries you serve?

Our products in all three of our business lines ensure that many daily-life products are safer, higher performing, more robust and more sustainable. At our high-tech tire reinforcement facilities we manufacture tire cord fabric using nylon 6.6, HMLS polyester, rayon and aramid yarn which form the skeleton of tires and provide flexibility and durability, and single end cord using synthetic yarns and natural fibers such as nylon, polyester, aramid and rayon. We reinforce one out of every three automobile tires and two out of every three aircraft tires worldwide. Kordsa develops innovative and unique intermediate products and applications for composites technologies for a variety of industries, notably aviation and automotive. Our portfolio consists of a wide range of high quality and durable products for the aviation industry, mass-producible products and visual parts for the automotive industry, flexible products for the sporting goods industries, and long-lasting products produced at low temperature for the maritime industry.

With our solution partner vision, in addition to fabric and resin development activities, our composite technologies also serve design, analysis, material library, and prototype production in accordance with customers' needs.

With the aim to be a solution partner, we are working on developing customized, cost-efficient intermediate products for composites. By adding advanced material technologies for next-generation transportation vehicles, we expanded our advanced composites technologies portfolio which we formed with our investments in the US in 2018 and became a company capable of supplying a total range of materials. This has also strengthened our product development capabilities. We develop synthetic fiber reinforcements in construction reinforcement technologies to ensure sustainable and durable concrete structures. Being the first Turkish product in the international synthetic fiber market, our synthetic fibers are highly preferred for many prestigious projects due to their ease of use, long-lasting durability, quick applicability, low carbon emission and high performance. Our synthetic fibers were recently used in the construction of the Buca-Bornova Tunnel, the longest highway tunnel in Izmir, toll-gates of the Third Bridge on the Bosphorus, Samsun Light Rail Transit System Project (Samsun Tram), Tekirdağ Asyaport (Turkey's first transit container port), and Trabzon DSI Pressured Water-Conveyance Tunnel.

Could you tell us about your domestic and foreign sales activities? In which regions do you sell your products?

At Kordsa, we operate in strategic markets. In determining our investment strategies, we consider customer proximity and changing market dynamics, and take advantage of business opportunities that support our sustainable growth strategy. At the beginning of 2017, our raw material supplier Invista in the United States announced that it would exit production in Chattanooga, Tennessee. We were producing in the same facility and made an agreement with them to purchase the entire infrastructure and part of the machinery park with an investment of USD 4 million. As of the first half of 2019, the Europe, Middle East and Africa region has a 30% share in Kordsa's total sales. With the power of the Composite Technologies Center of Excellence, a pioneering model in industry-university cooperation, we continue to introduce our new technologies to the market and expand our product range in the Europe, Middle East and Africa region.

Asia Pacific, our second largest hub after Turkey, has a 26% share. We have 7 polyester lines in Indonesia where we have invested over USD 175 million since 2011. We are the only local polyester cord fabrics producer in South America.

As of the first half of 2019, this region has an 11% share in Kordsa's total sales. In North America we are the leader in nylon cord fabric production, with a 33% share in total Kordsa sales. We strengthened our presence in composites technologies in North America with the acquisition of Fabric Development, Textile Products and Advanced Honeycomb Technologies. Following these investments, we acquired Axiom Materials, which provides advanced-technology composite materials for next-generation transportation vehicles as well as the aerospace industry and leads the composite market through its R&D studies. With this acquisition, we have completed our advanced composite technologies portfolio and became the only worldwide qualified manufacturer of Oxide-Oxide ceramic matrix composites, which are resistant to high temperature and used in aircraft engines. Today, we reinforce the engines of aircraft that we have been reinforcing their tires, wings, hulls and interior. We are a global player in reinforcement technologies across a wide geographical area from the USA to Asia Pacific, including Turkey, USA, Brazil, Thailand, and Indonesia. We operate with around 4,500 employees in our 12 facilities across 4 continents.

You have launched a new technology called Cokoon, developed jointly with Continental. Could you please tell us about this technology?

At Kordsa we had been working for nine years to provide a sustainable solution to the industry. Our R&D team worked day and night for 15,800 working hours, conducted 11,240 tests over nine years. We joined forces with Continental, which shared the same vision with us. Our new dip technology Cokoon does not require any additional cost. It is possible to adhere textile and rubber using existing equipment. With Continental, without requesting any license fee, we enable anyone who joins the license pool to use the Cokoon technology. In six months, 40 companies contacted us for Cokoon technology which we introduced at Tire Tech 2019 Expo. We are in the sampling phase with 17 of these companies. We expect this dip technology to become the new industry standard. To achieve this, we don't only provide an innovative product but also an innovative business model. This free licensing model we have created encourages everyone to access the technology and develop it further. In this way, besides making it a standard in our own industry, we will advance our technology further and will be able to expand its use in different industries and different fields.

Today, all industries are adapting to digital transformation. How far can the composites industry adapt to this transformation?

At Kordsa, we are also leading the industry with production models based on our own Industry 4.0 applications. With the smart production systems we have implemented, we aim to accelerate production and innovation processes with improved production quality and reduced errors. For this reason, we strengthen our production processes by maintaining our innovative perspective with a specific focus on open innovation and by closely following digital transformation and Industry 4.0 developments, which include many fields such as intelligent robotic applications, big data management, cloud applications, IoT systems, mobile and virtual reality applications, simulation systems and cyber security. We follow technologies that match our company strategies and targets, and that enable change and transformation in our production processes, and we invest in applications that create value in efficiency, quality, cost and safety processes. Along with digital transformation, composites technologies and the areas of application of composite materials are improving day by day. Today, composites are used in so many ways throughout our everyday life and will be used even more widely in the future.

Especially smart composites and robotic applications are the materials of the future. In the coming period, we believe that it will be crucial to implement material-based engineering such as R&D, product development and manufacturing design in interaction with the customer.

Therefore, materials science is a major science with strategic importance in the digital world. As for Kordsa's material science studies, we have joint or individual projects. For example, at our Composite Technologies Center of Excellence, together with 16 project partners from 11 countries we work on the DiCoMi project, a project on the development of systems, software and materials in order to produce composite materials with 3D printer technology. We now seek opportunities in next-generation materials such as thin film and flexible electronics which are among smart materials of the digital era. Thin films already have a wide range of applications from TVs to smartphones or notebooks. Flexible electronics will be in our daily lives in the near future. Applications like foldable display sheets will replace printed newspapers or tablets, robots with soft and flexible skin will look and feel like real skin. We focus on this material of the future and launched a "Thin Films and Flexible Electronics" R&D platform in partnership with Sabancı University. We began a new project in May 2019, Nanosis-1004. With this project, we aim to develop a new generation of flexible-type wearable healthcare sensors. We are in contact with some internationally renowned universities, institutions and companies in Turkey, the US and Europe to extend our partnerships. We are also seeking opportunities to invest in a new lab and pilot machines suitable for flexible electronics technology.

Could you tell us about your composite material production techniques within the scope of new technological developments?

The main focus of our Composite Technologies Center of Excellence, bringing university and industry under the same roof, is the weaving of high-strength composite reinforcements using carbon, aramid, and glass, developing resin formulations, prepreg production and developing applications for use in various industries. We are currently capable of weaving unidirectional and bidirectional fabrics of carbon, aramid, and glass from 200 g/m² to 1,500 g/m² in four different weaving types: plain, twill, harness satin or basket. In addition, our product portfolio includes hybrid weaves where two different threads can be used. At the center, we develop systems, software and materials in order to produce composite materials with 3D printer technology, produce high quality composite parts using both traditional methods and robotic applications.

The lab is equipped with Robotic Automated Fiber Placement (AFP) for composite manufacturing, lab and industrial-scale hot presses, robotic machining and abrasive waterjet machining of composites and metals, and additive manufacturing of composites. Our autoclaves produce denser, void-free moldings.

This ensures the fabrication of high strength-to-weight ratio parts from pre-impregnated high-strength fibers used mainly in the aerospace industry. The center includes another lab focusing on improving and enhancing existing processes as well as developing new hybrid processes for manufacturing multifunctional complex parts. The lab focuses on metal, high-performance plastic, composite and hybrid additive manufacturing processes. With our acquisition in the US, we have expanded our competencies in advanced materials technologies with high growth potential. We are capable of producing structural materials and interior parts materials that require high engineering for the aviation industry where we see great potential. Finally, with the acquisition of Axiom Materials, the only worldwide qualified manufacturer of Oxide-Oxide ceramic matrix composites for aircraft engines, we now reinforce the engines of aircraft, of which we had been reinforcing the wings, hulls and interior. We have completed our portfolio of advanced intermediate composite technologies.

What do you think are the conditions of being a global brand that transcends borders?

First of all, you must think globally, follow developments and trends, be proactive and lead change without resistance to change. With our "We Reinforce Life" mission, we aim to create sustainable value by providing innovative reinforcement solutions with high added value to our customers, employees, stakeholders and communities. We lead change and transformation with our open innovation mindset. We shape the industry with our sustainability approach and R&D and innovation investments. This strengthens our global presence.

Could you tell us about your R&D and sustainability activities?

Sustainability is at the center of product development in the industries we currently operate. Kordsa also develops its product portfolio with sustainability at the center. In composite technologies, we reduce fuel consumption by making vehicles lighter and more durable and develop new and sustainable technologies for next-generation transportation vehicles. We reduce friction resistance with our innovations in tire reinforcement technologies while we work to ensure the durability and stiffness of concrete structures in construction reinforcement technologies. Putting R&D and innovation at the heart of our business processes, we increased our patent portfolio by 22% from 2017 to 2018. As a result of our efforts to produce lighter and more durable tire and composite materials using less energy and materials, our number of patent applications reached 786 and the number of inventions reached 183 to date. We currently have two R&D Centers. In our first R&D Center in İzmit, we develop new products, processes and technologies for the tire and construction reinforcement markets. Our latest innovation in this field is a new green technology developed jointly with Continental that replaces an 80-year-old formula with resorcinol and formaldehyde. We called this revolutionary technology Cokoon. Now we are working on free licensing. We have another ongoing project that we conduct with an open innovation approach providing sustainable solutions for efficient plastic recycling.

We are among 21 project partners from 11 countries in this project, namely PolynSPIRE, within the scope of Horizon 2020. Our second R&D center is located at the Composite Technologies Center of Excellence where R&D, innovation and production take place under the same roof. Established in 2016 at Teknopark,

the Composite Technologies Center of Excellence is one of the few examples of university-industry cooperation in the world and a leading example in Turkey. Researchers, designers, engineers, managers and staff of the production process, PhD students, postdoctoral fellows, faculty members and entrepreneurs from incubators work together at the Center in cooperation with Sabancı University. At the Composite Technologies Center of Excellence, we serve with an open innovation approach in all phases of the R&D cycle starting from basic research, continuing with prototype production and ending with mass production in cooperation with various institutions and organizations and create innovative new technologies shaping the industry. At our Center of Excellence, we continue to cooperate with universities and institutions from different countries on new projects such as the EU-funded project for the development of systems, software and materials in order to produce composite materials with 3D printer technology. After our resin technology that reduces curing time to three minutes, we have also developed a dicy-free CM14 resin. We have developed a new groundbreaking e-glass prepreg in cooperation with Ford Otosan for light weighting, which is recently the top priority in the automotive industry. The new innovative leaf spring for heavy-duty vehicles over 16 tons also includes structural health monitoring systems used for process optimization, part qualification and online health monitoring purposes. We also have R&D activities on construction reinforcement materials. Our macro and micro synthetic fiber reinforcement products are preferred in many prestigious projects. We started to produce an improved version of KraTos, which differs in its high strength, in the new polypropylene monofilament fiber reinforcement line that we commissioned in June 2018.

When it comes to our sustainability activities other than sustainable product development, we are in the fourth year of our 2020 Sustainability Roadmap covering our five-year goals and actions.

We see ensuring our own sustainability as the first step of sustainability; we always prioritize employee development, health and safety. In 2018, thanks to our safety projects such as the Occupational Safety Experience Center, we continued to work with zero accident targets across five continents and to support the personal and professional development of our employees through internal platforms that encourage the development of ideas and projects. In 2018, we provided an average of 36 hours of training to our employees. As a global reinforcement brand, we have continued to make improvements in all of our operational processes while respecting the society and environment we operate in. Over the years, we have gradually improved our performance with our R&D and TPM projects. Continuous improvement of material, water and energy efficiency in production is among our priorities. In 2018, we saved USD 1.82 million by reusing our materials. We reduce our waste every year with the measures we have taken at all our facilities regarding waste management, including the monitoring and reduction of carbon emissions. This year, we made environmental investments of USD 790 thousand within the scope of emission and waste management. We continue to share our CDP Climate Change and CDP Water reports with investors every year.