Our latest survey of 82 custom injection molders confirms the obvious—they’re hurting.

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 Our latest survey of 82 custom injection molders confirms the obvious—they’re hurting. In the second half of 2008, their average capacity utilization dropped by the largest amount ever—7.4 percentage points—to 47.4%, the lowest level since these surveys began in 1983 and the first time ever that capacity utilization registered below 50%. Under those conditions, it’s no surprise that Plastics Technology’s Hourly Rates Index dipped 1.4% in the second half of 2008. That was the first fall in the index since the end of 2004.

Even though the index was down, the vast majority (79%) of respondents to the survey did not change their rates in the second half of 2008. Just 10.5% of respondents lowered their rates and 10.5% raised them. But the declines were larger than the increases, accounting for the dip in the index, which had edged steadily upwards for four years running.

Meanwhile, 62% of respondents saw lower capacity utilization in the second half of 2008—the highest proportion ever recorded in these surveys. Just 16% saw higher operating rates, while 22% saw no change.

According to 57 mold shops responding to the survey, new mold orders were 17% lower in the second half of 2008, the largest drop ever, and only the second case of a double-digit decline (the first was in early 2001).

Optimism was at an all-time low when this survey was conducted in December. Only 23% of molders expected near-term improvement in business conditions, while 50% expected worse conditions, and 27% were neutral.

 

PROFIT & LABOR IN HOURLY RATES
Deduct these amountsa from the figures in the larger table to arrive at rates without profit, operator, or both.
Press 
Tonnage 
Without
Profit
Without
Operator
Without
Either
<100
12.4%
17.6%
31.7%
100-299
8.5%
13.4%
26.4%
300-499
7.4%
11.3%
22.3%
500-749
5.9%
9.6% 
18.8%
750-999
6.1%
13.5%
21.0%
1000+
6.9%
14.6%
16.5%
aCumulative national averages over many surveys.

 

 

 

 

 


 

 

 

 

 

 

CUSTOM INJECTION MOLDERS’ MACHINE-HOUR RATES WITH OPERATOR and PROFIT MARGIN INCLUDEDa 
(82 PLANTS)
Dollars Per Hour (High/Average/Low) 4th Quarter 2008
TONNAGE RANGE 
<50
50-99
100-299
300-499
500-749
750-999
1000-1499
1500-1999
2000-2999
3000+
INDEXb
NORTHEAST
(ME, NH, VT, MA, CT,RI, NY, NJ, PA)
$100.00
$100.00
$110.00
$120.00
$78.77
$87.53
$90.00
    
$49.99
$47.39
$53.81
$71.95
$56.78
$87.53
$90.00
   
98
$23.00
$23.00
$26.00
$32.00
$35.00
$87.53
$90.00
    
SOUTHEAST
(DE, DC, FL, GA, MD,
NC, SC, VA, WV)
$65.00
$65.00
$75.00
$95.00
$95.00
$95.00
$125.00
$41.95
$41.95
$41.95
 
$41.81
$42.77
$47.50
$55.54
$69.13
$72.53
$79.87
$41.95
$41.95
$41.95
86
$28.00
$28.00
$30.00
$38.00
$44.16
$44.16
$44.16
$41.95
$41.95
$41.95
 
NORTH CENTRAL 
(IL, IN, MI, OH, WI, IA, KS,
MN, MO, NE, ND, SD)
$93.84
$70.66
$138.00
$90.84
$130.45
$165.97
$200.12
$125.00
$175.00
  
$38.20
$41.57
$51.55
$58.51
$72.97
$99.68
$144.03
$125.00
$175.00
 
89
$8.20 
$19.38
$21.00
$37.34
$45.00
$70.00
$115.00
$125.00
$175.00
  
SOUTH CENTRAL
(AL, KY, MS, TN, AR,LA, OK, TX)
$40.00
$40.00
$45.00
$55.00
$59.44
      
$28.44
$30.13
$37.00
$45.43
$59.44
     
66
$21.01
$23.34
$33.50
$40.01
$59.44
      
WEST (CA, OR, WA,AK, HI, AZ, CO, ID, MT,NV, NM, UT, WY)
$58.35
$75.13
$75.86
$102.45
$116.70
$75.86
$75.86
$75.86
$75.86
$75.86
 
$45.40
$49.27
$51.00
$77.61
$94.39
$75.43
$75.43
$75.43
$75.43
$75.43
100
$17.50
$24.59
$31.42
$55.20
$75.00
$75.00
$75.00
$75.00
$75.00
$75.00
 
NATIONAL AVERAGEc
$41.79
$43.33
$50.15
$63.56
$70.81
$88.58
$108.54
$98.85
$98.85
$63.03
 
Change in Hourly Rates Index In Second Half 2008: -1.4%
aAn adjustment factor is used where data did not already include profit and labor. bRelative to highest-cost region (which equals 100); value shown is a weighted average for all size ranges. c Weighted geographically according to Plastics Technology’s Manufacturing Census.