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BASF has appointed Markus Kamieth to take over as CEO, an executive closely associated with the world’s largest chemical group’s expansion plans in China.
The Ludwigshafen-based group on Wednesday said Kamieth, who currently oversees BASF’s China operations, would take over from Martin Brudermüller in April, confirming earlier reports from the FT.
With its energy intensive operations, BASF has been grappling with high costs, low demand and falling earnings, especially in Europe, where it has announced cost cutting while embarking on the construction of a state of the art €10bn petrochemical site in Guangdong.
After Russia’s invasion of Ukraine, the chemical group’s China strategy has come under scrutiny as Berlin has become increasingly anxious about the reliance of large swaths of its industry on the Chinese market.
Kamieth was, according to people familiar with the matter, backed by Brudermüller, who announced plans to build a new integrated production site in China — BASF’s largest ever investment — just months after taking over as chief executive in 2018.
China is still today the world’s largest chemical market, but slowing growth and lagging demand in the country has come at a time when BASF is facing cost pressures in Europe due to its continued reliance on gas, which it uses both as an energy source and a raw material for its products.
The company’s headquarters in Ludwigshafen uses roughly 6 terawatt hours of electricity a year — close to 1 per cent of Germany’s total power consumption.
Arne Rautenberg, fund manager at Union Investment that holds less than 1 per cent of BASF’s shares, said Kamieth faced “enormous” challenges in his new job, as he would need to “secure [BASF’s] competitiveness of the European locations” as well as oversee its investments in China and battery recycling operations.
Brudermüller, who is set to become the head of Mercedes-Benz’s supervisory board, last year announced BASF would cut costs in Europe by €1bn over two years. He said at the time that the company needed to cut costs in the region “as quickly as possible and also permanently” due to soaring energy prices and tightening EU regulations.
Kamieth, who is currently based in Hong Kong, emerged as the preferred candidate earlier this year when Saori Dubourg, who headed BASF’s European business, suddenly left the company in February. Dubourg had advocated a more cautious approach to China and clashed with Brudermüller, according to people familiar with the situation.
Melanie Maas-Brunner, the company’s chief technical officer who was also in the running for the top job, would not be renewing her contract beyond 2024, BASF said.
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