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US injection moulding machines buoyed by automotive success

By Bill Bregar, Plastics News
Posted 5 December 2012

Growth in automotive activity has been a major factor in the growth of injection moulding machine shipments to the US, which could hit the 3,000-unit mark in 2012.

“Automotive was booming this year. There’s no question,” said Friedrich Kanz, president of Arburg Inc. in Newington, Connecticut.

North American auto builds could top 15 million in 2012 and with the average age of a car at 11 years, production should remain strong again next year, automotive analysts predict.

Couple that strong production with new-model introductions and making cars lighter to meet aggressive US fuel economy standards, and the long-term picture looks good for plastics – and investments in new moulding technology.

“We’re getting a double on it,” said David Bernardi of Ube Machinery in Michigan which makes large-tonnage machines. “One of things is because of the pent-up need. The industry doesn’t have the production requirements to match what is being sold. More vehicles are being sold than you can make, so because of that, the car industry has to buy equipment, and they are,” he said.

Ube specialises in large-tonnage machines — a hot area of demand for making automotive parts like bumper fascias, body parts and instrument panels.

Bernardi, Ube senior sales and marketing manager, said the capacity issue also extends to makers of large presses, one reason he thinks 2012 shipments will flirt with, but might not surpass, 3,000.

“Not because there isn’t the desire, but I don’t think there’s the capacity,” he said. Ube has machines booked into next summer.

US shipments sank to a paltry 1,285 in 2009, since when the numbers have steadily climbed back, to 2,111 in 2010 and 2,400 in 2011, according to reports from the Society of the Plastics Industry; US shipments would need to rise 20% in 2012 to hit 3,000.

The sector first fell below 3,000 in 2007.

Regardless if 2012 shipments hit 3,000 or fall just short, machinery executives now are looking ahead to 2013. The big question: Will automotive moulders demand even more injection mouoding machines in the coming year? Reaction is mixed, but the answer will help decide whether machine sales keep going up or decline.

“What will automotive do next year? It cannot continue, most probably, on such a booming level. So it will slow down a little bit,” said Kanz. The Arburg executive is not expecting automotive to dive in 2013, just cool off. “But do we expect 3,000 machines next year? I don’t know, but I would expect at least 2,500,” he said.

Packaging and medical continue to be solid, recession-resistant markets for injection moulding machines. Several equipment executives said demand for medical has moderated, perhaps because of election-year uncertainty over the fate of Obamacare, and a US excise tax on medical devices, set to start on 1 January 2013.

“When the economy’s down, you can look to packaging and medical as the two primary markets that will underpin the machinery market. What we see now is a resurgence in automotive, which is putting the froth back in the market,” said Tony Firth, vice president and general manager of Negri Bossi North America in Delaware.

Firth added that some business is returning from China to the United States and Mexico. “We’re really pleased. We’ve increased sales significantly, year on year,” he said.

Paul Caprio, president of Kentucky-based KraussMaffei, points to new models and smaller cars aimed as gas savings. “Every new model — that’s new moulds and new machinery,” he said. “So I think 2013 is going to be as strong as 2012, in the automotive side.”

Work returning the American shores is giving appliance moulders a bounce, thanks to General Electric Co.’s decision to move appliance manufacturing back to the US and invest $800m (£497m) in GE Appliance Park in Louisville, Kentucky. GE had outsourced much of the work to suppliers in Asia.

Several injection press makers report they have sold machines to Appliance Park, or to US moulders picking up work from GE.

“I see other projects that are coming back, that we are getting business from,” said Tom McKevitt, vice president and general manager at Toshiba Machine Co. America in Elk Grove Village, Ill.

McKevitt said Toshiba is selling machines to make parts for both Japanese transplants and domestic automakers. He reports big demand for midrange presses, in clamping forces from 720-1,450 tons.

“We can sell pretty much everything we bring in that size range,” he said. “It doesn’t sit in inventory.”

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