ADVANCED MATERIALS 

Well within ten years new houses won't be made of wood nor bricks, cars and engines won't be steel, airplanes won't be constructed of riveted aluminum sheetmetal your leisure-time sports equipment will be composed of advanced designer materials that didn't exist previously. If you golf, play tennis or drive a Toyota you may already be involved.

This latest 'revolution' will topple more old 'sunset' industries and create a new wave of 'sunrise' industries. The way it is already going doesn't bode well for North American or European business. Natural resources as we have known them, will no longer be required in anywhere near the quantities they have been consumed in the past.

These new structural materials are classified as ceramics, polymers or metals. But now two or more of these materials are being combined to form various composites that have superior properties to that of their constituent materials. These advanced materials are known as ceramic (CMC), polymer (PMC), and metal (MMC) matrix composites. Also entering this field are other metal alloys and unreinforced engineering plastics also called "advanced materials".

All of these materials have qualities superior to those used in the past. The new materials are stronger, weigh less, can endure far higher temperature ranges -- up to 16490C (30000F) -- than other materials and may lend themselves to automated production techniques in ways not possible with the older industrial age "raw materials". At the moment they are more expensive and difficult to fabricate. But that is about to change as a whole new discipline known as "processing science" develops. Calculations show that an automobile body containing 250 to 350 parts could be reduced, using PMC's, to between two and 10 parts. Less labor, faster production, more appeal with built-in efficiency.

What is happening now shows the basic difference between North American and European manufacturing attitudes and those of the Japanese. Canadian and U.S. companies are "pulled by the market". Until there appears to be strong consumer, industrial or commercial demand for a product, they hesitate to invest in the R&D required for the new field or to prepare for volume production. In the case of these advanced materials their limited information, by not being "in" the market, tells them that they will be no substantial developments for 10 to 20 years. The fear that the new product may not be viable and that their investment during that time frame will be lost. Because their citizens have a low-savings rate (U.S. now two percent) borrowed money costs companies more in interest (10 to 14 percent), so losses could be considerable. They are also forced to consider upcoming financial statement as shareholders are fickle and depart if the next quarter shows no profit. They might easily be taken over while money is tied up in future programs.

The Japanese believe in "technology push". They think that if they create a new product, research the market entensively then they can force consumption by the new advantages built into their latest product. By getting in, not on the ground-floor but on the excavation, they have more information on possibilities and calculate shorter development times.

They are willing to sacrifice near-term profits to gain the production experience necessary to secure a sizeable share of future markets. Shareholders see the advantage of long-term market share and forego short-term profit for the larger capital gains to be made when the new market explodes. Their high-savings rate of the past decade (averaging around 22 percent of gross income) lets Japanese companies borrow at low interest (four to five percent) for new ventures. Since results utilizing this philosophy worked in the past with videocassette recorders, television, micro-chips, fax machines and automobiles won't it in the future?

They will exploit developing global markets as they use their newly acquired knowledge in this field of advanced designed materials.

North American and European companies will continue to see their production of old-style materials deteriorate even further. Current example: Sheffield, England and Solingan, Germany, long the stronghold of fine steel cutlery now being eclipsed by the world's largest maker of ceramic knives and scissors, Kyocera of Japan. Their knives and scissors never wear out, rust or corrode, never need sharpening and are guaranteed forever.

Further worry? South Koreans are currently saving 35.8 percent of their gross income. (They call the Japanese "the lazy Asians" because they are starting to take Saturdays off!) and they are becoming even more fanatical over quality than the Japanese.

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