How are chemical giants like LG Chem and BASF maintaining high R&D spending despite industry-wide financial pressure?

Despite industry-wide revenue and profit stagnation—and widespread capital expenditure cuts—LG Chem announced a plan to invest 15 trillion KRW in R&D through 2035, prioritizing AI-driven high-value materials and allocating 70% of funds to growth sectors like semiconductors, mobility, robotics, and oncology drugs; similarly, BASF maintained near-record R&D spending of €19.9 billion in 2025—up from €19.7 billion in 2024—ending a multi-year decline and sustaining its position as the global leader in chemical R&D investment since 2011, with funding directed at green processes, circularity, and digital R&D tools across its integrated global network.

What specific role is AI playing in transforming materials R&D for leading chemical companies?

AI is dramatically accelerating materials innovation by cutting R&D timelines—up to 80% in pioneering firms—and reducing costs by millions annually; it enables rapid screening of polymer formulations that previously took months to complete in weeks, mirrors pharmaceutical gains where AI halves drug development cycles, and serves as a core driver for cost efficiency, speed-to-market, and commercial success—directly countering traditional bottlenecks like fragmented data, manual experimentation, and >60% new-product commercial failure rates.

Chemical Giants Transform R&D Models

Aug 21, 2026

Global chemical leaders like BASF and LG Chem are maintaining high R&D spending and adopting AI for material innovation despite market downturns. Strategic restructuring aims to boost efficiency and accelerate the commercialization of new products.

ccin

2026-08-21

Chemical Giants Transform R&D Models

Chemical Giants Transform R&D Models

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