Chairman's
Letter cont'd
The
third segment targeted for growth, Praxair Surface Technologies,
already is a service operation, applying high-performance coatings
on jet engine blades, printing and textile rolls, and other metal
parts. Prior to the downturn in aerospace markets over the last
two years, the subsidiary grew more than 15% per year. We expect
to achieve similar growth in the future, in part by refocusing
the business on new and emerging markets. For example, Praxair's
thermal-spray technology is at the heart of a new parts-production
process being commercialized by Ford Motor Company. In addition,
the subsidiary has begun to provide services and materials to
the semiconductor industry, and its expertise in materials sciences
is a potential source of growth.
Praxair
Surface Technologies' extension into the electronics market creates
synergies with other Praxair businesses. Our largest electronics-related
business is Praxair Semiconductor Materials, which is expanding
its global capabilities, particularly in Asia. Building on its
leading position, Praxair China signed a 15-year contract to supply
industrial gases to three wafer-fabrication facilities in a new
hi-tech park in Shanghai. We believe this park will be one of
the world's leading production sites in the coming decade. During
the year we also strengthened our presence in Taiwan and signed
a contract to supply a new fab in Malaysia.
Looking ahead, Praxair is actively involved in developing the
next generation of materials for semiconductor production, including
super-critical carbon dioxide technologies and new ceramic and
metals materials. Acquisitions emphasizing materials management
and site services will complement our investments in research
and development.
