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Rise of the robots

By: Tony Deligio 11. June 2014

For three straight years, the U.S. has set new records in the number and value of robots sold. The North American robotics market recorded its best year ever in 2013, delivering 22,591 robots valued at $1.39 billion, according to the Robotics Industries Assn. (RIA), Ann Arbor, Mich. For the year, total units were up by 11%, while sales jumped 7%.
 

For perspective on how fast the market is moving, consider that in 2010, when the industry posted its best year since 2007, it did so with orders of 13,174 robots valued at $845.6 million. Compared to 2013, units have exploded by 72% while the dollar value has jumped 64%.
 

Now consider that according to RIA, many market observers believe that only 10% of U.S. companies that could benefit from robots have installed any.

 

Busy times
That booming—if largely untapped—market was verified by a number of automation suppliers I contacted while researching a feature on robotics in the plastics industry. That article will appear in an upcoming special supplement from Plastics Technology parent, Gardner Business Media, with additional content from PT sister publications Automotive Design & Production and Modern Machine Shop.
 

Difficulty in trying to schedule interviews with suppliers tipped me off to just how busy the segment has been. Eventually, conversations with Fanuc, ABB, Sepro, Engel, MGS, CBW Automation, and more painted a picture of a booming sector, with record years, highly traveled sales representatives, and frenetic shipping docks.
 

When I visited CBW Automation in Fort Collins, Colo., a semi had just been loaded with three newly completed automation cells. Despite moving those systems off the factory floor, inside the plant, the shop floor was already packed with new systems in various stages of completion.
 

I visited with Sepro during the grand opening of their new North American headquarters outside Pittsburgh. The new, expanded site for the French-headquartered robotics supplier was necessitated by record performance in the company’s largest market: North America.
 

At Sepro as well, work continued on systems being readied for delivery as 2014 got off to a strong start. During the open house, executives anxiously tracked order income on the last day of the quarter.
 

It’s not just North America that’s seeing such high interest in robotics. One of the CBW systems was headed to China, and when I finally got a hold of someone at ABB to discuss the plastics market, the individual I spoke with had just returned from Asia, where interest in automation, despite its reputation for low-cost manpower, is also extremely high.
 

Globally, a new report shows that the worldwide industrial controls and robotics market was worth $102.02 billion in 2012 and is expected to reach $147.7 billion in 2019, growing at a rate of 5.6% over that time. North and South America were the largest market in 2012, according to the report, due to “re-engineering in the old industrial segment along with the adoption of new technologies and increasing demand for mass production.”
 

How much does your shop utilize automation? If people still outnumber robots on the production floor, particularly if you’re an injection molder, you might wonder about how automated some of your competitors have become in recent years.

Chinese cutlery manufacturer adds production…in the U.S.

By: Tony Deligio 3. June 2014

There’s an old newspaper maxim which holds that a “Man bites dog” story will grab more reader interest than “Dog bites man” item on the basis of sheer novelty.

 

That pearl of reporting wisdom came to me as I read a recent release detailing how a Chinese maker of plastic cutlery and food service ware would be opening its newest manufacturing site in Pennsylvania.

 

“Production of [insert plastic commodity here] moved to [insert low-labor cost country here]” headlines achieved “Dog bites man” status some time ago in the U.S. Today, those stories are less common simply on the basis of most so-called “shoot-and-ship” commodity processing having long since left the states, as well as a reshoring push that has seen a not insignificant amount of work come back, but even more rare is a “Chinese maker of commodity plastic goods announces U.S. production” news report.

 

Such was the case on May 29, however, when China-based Taizhou Fuling Plastics Co., Ltd. announced plans to open its first production facility outside China in Allentown, Penn. Headquartered in Wenling City, Zhejiang Province, Fuling is now leasing an 88,000-ft2 building site in Lehigh County to serve as its first manufacturing site in the U.S. In China, it runs 120 injection molding machines, 10 extrusion lines, and 20 thermoforming lines.

 

According to a release, Fuling plans to invest more than $21 million in building improvements as well as new machinery and equipment, with a commitment to create at least 75 jobs within the next three years. It’s that last point that helped Fuling earn a $33,750 Guaranteed Free Training grant from Pennsylvania’s Department of Community and Economic Development (DCED), with the monies to be used to train its new workforce. Additionally, the company will receive a $150,000 Pennsylvania First Program grant and $150,000 in Job Creation Tax Credits.

 

At this time, Fuling Plastics USA has three employees, including Bob Chapleski, hired on as the VP of production. Chapleski is entering his 25th year of manufacturing, with much of that experience in plastics packaging, including stints at Nestle Waters, Sabert Corp., and most recently, Tray-Pak, where he was the director of manufacturing. After interviewing with Fuling's U.S. sales manager, Chapleski was interviewed by the owners of Fuling, Xin Hu and his wife Guilan Jiang, who flew to the U.S. and spoke with Chapleski through a translator.  
 

Fuling injection molds, thermoforms and extrudes service ware, including plates, cups, utensils and straws, using PS, PP, and PLA for customers in the U.S., Europe, Australia, South America and the Middle East. Current customers include fast-food giants McDonald's, KFC, Wendy’s, Burger King and Subway, as well as supermarket chains, including Wal-Mart and Target.
 

The company is leasing a 70,000-ft2 building for its U.S. operations. Chapleski said current plans call for injection molding and extrusion, producing drinking straws, cups, bowls, and lids. Initially, the plan is to install 12 injection molding machines and 12 extrusion lines, including the requisite auxiliaries, in the July, August timeframe, with production by the fourth quarter. Fuling estimates it will save $10 million annually on shipping costs alone by relocating U.S.-bound production to the U.S.
 

I asked Pennsylvania’s Department of Community & Economic Development (DCED) how the seemingly odd match of Chinese cutlery manufacturer and the Keystone State came to be, and they said it was Fuling that initially contacted the U.S. Consulate in Shanghai, which in turn reached out to the Pennsylvania Authorized Investment Representative’s office in Taiwan. Pennsylvania was among a “few” states that were contacted, according the DCED.
 

According to Chapleski, Fuling also scoped out potential locations in the Carolinas, New Jersey, Maryland, and three sites in Pennsylvania before settling on Lehigh County. The representative also noted that Fuling is not the first foreign company to invest in Pennsylvania.

 

Citing the Financial Times, the office said that Pennsylvania was one of only three U.S. states to have a positive growth in Foreign Direct Investment in 2013 over 2012.  

 

“2014 is shaping up to be another growth year for Pennsylvania as it relates to FDI with several foreign companies investing in Pennsylvania,” the representative added. The representative also explained that this FDI is in part the result of Pennsylvania Governor Tom Corbett’s business development missions to France and Germany in 2012 and Brazil and Chile in 2013.

 

Perhaps more "Foreign maker of commodity plastic goods announces U.S. production” headlines will be coming across the wire.
 

As a plant manager in the manufacturing heavy Northeast, Chapleski sat in on round tables where participants anticipated a story like Fuling's coming along. "I knew manufacturing would be coming back to the states," Chapleski said, "it was just a matter of time. When I started with Fuling, I thought, 'How great is this?' One, manufacturing by U.S. employees, U.S.-made products for some very large, stable customers. On top of that, Fuling is the biggest and the best in all of China for food service ware, really high technology."

 

An added bonus is when manufacturing reshores so close to home. "It's very exciting stuff for me; it's right in my backyard. I love that."

Krauss Maffei’s open house reaffirms importance of North American market

By: Tony Deligio 3. June 2014

The attempt to identify the owner of a poorly parked vehicle at KraussMaffei’s recent Florence, Kentucky open house reinforced in two ways just how good business for the Munich-headquartered plastics machinery manufacturer currently is (Photo courtesy KraussMaffei).

 

First, there is the fact that interest in the company’s technology offerings was high enough that the lot at its Florence facility quickly filled during its May 15 open house, forcing some visitors into borderline “parking” spots.

 

Second, there is the fact that one of those borderline parking spots obstructed a loading area, which is a no-no with the company’s business on record pace, and deliveries into and out of Florence necessitating a wide open loading/unloading zone.

 

“We had nothing but really, really good feedback,” Paul Caprio, president of North American operations at KraussMaffei Group said of the open house and its large turnout, which he estimated at double the number of visitors compared to 2013’s. “I think it’s also a reflection that times are very good in manufacturing right now. The customers that could get away—folks are still very busy—came in to see what we were doing.”

 

Those who attended could also see what KraussMaffei’s technology partners were doing, thanks to tabletop exhibits. These were interspersed with running equipment, including live displays of injection molding, pipe extrusion, and compounding, as well as a dry-cycle display of the a mold carrier from the company’s reaction injection molding (RIM) division. In addition to all that, attendees could take in technical presentations, with concurrent tracks of injection molding and extrusion related papers.

 

The event marks the second straight year KraussMaffei held an open house at its North American headquarters in Florence, which sits at the northern border of the Bluegrass state, just minutes “as the crow flies” from the Ohio River. Held in mid-May, the event’s timing was altered from last year, positively impacting attendance in the view of Caprio.

 

“Last year’s event was excellent,  but it was in June, and we had twice as many people this time,” Caprio noted. “I think June is a big vacation month, so this year, we got all those people back plus all the others that were on vacation last time. It definitely surpassed what we expected.”

 

Three straight years of record results
The heightened interest in the event reflects the overall success KraussMaffei is experiencing in North America, where Caprio believes the company will enjoy another record sales year in 2014, just as it has done in 2012 and 2013.

 

“[Business] has been tremendously good and strong,” Caprio said, “and it’s been running that way for a couple years now in the States, Canada and Mexico. We’re expecting this year to be another record year; normally [capital equipment suppliers] see things tighten up before any one else does, but it’s doing anything but slow down right now.”

 

Florence is in the midst of the new automotive corridor running throughout the Southeast and the strength of that market has been noticed by KraussMaffei. “Automotive is driving everything,” Caprio said, adding that as the overall economy improves, particularly as unemployment rates go down, packaging, which the company largely serves via its Netstal brand of injection molding machines, could see a sough-after boost.

“I do think our packaging customers have felt a little bit of a softness in their markets,” Caprio said. “People at a grocery store choose the less expensive container in tougher times. Once people are working, they go back to convenience, and spending more on brand. That will give our packaging customers a lift.”

 

Beyond that, Caprio noted that the medical market remains a strong, if smaller, segment, with appliances also moving in the right direction in terms of activity and geography.

 

“In appliances, we’re seeing reshoring, with business come back from China and Mexico,” Caprio said. “Those are great developments for the U.S.” It’s great for KraussMaffei as well, with the company able to win appliance business in both its PUR and injection molding segments.

 

In terms of staffing, Caprio noted that Florence is back to 2008 levels, before the crash, with nearly 200 employees, but now more sales per worker. “We’re bigger than we were sales-volume-wise with less people,” Caprio said, “so we get more out of our people. Down times and technology help make you more efficient.”

 

KraussMaffei is a global operation, with manufacturing and assembly on three continents, including aftermarket operations, spare parts, and assembly of extrusion and RIM systems in Florence. For now, operations in Florence will remain the same, with no plans to assemble injection molding machines in Kentucky given the diversity of the company’s offerings and the market’s relative size.

 

That said, Caprio did note that North America is KraussMaffei’s second largest market, behind only Europe, accounting for about 25% of its business in terms of volume. “The volume number seems to get bigger, but percentage-wise seems to stay the same,” Caprio said of North America, noting that despite that, they see continued growth for the region.

 

“North America is a very appreciated, mature market that buys on value and that’s very important,” Caprio said. “It’s the mature markets that realize the technology savings.”

 

You can see where that’s appreciated by KraussMaffei, even when North American clients take liberties in where they park. 

 

Chinese plastics machinery industry makes gains at home and abroad

By: Tony Deligio 28. May 2014

Market watchers have anxiously combed through China’s economic data looking for that tipping point when the country’s domestic consumption would outstrip its ability to produce goods for use beyond its shores.

 

Companies of all stripes had long positioned themselves to seize the opportunity presented by the most populous nation on earth becoming a consumer of goods, not just a producer. Automotive OEMs, for instance, would shift from sourcing parts from the country for cars sold elsewhere to building and delivering cars in China for the Chinese consumer.

 

In plastics machinery, that tipping point has been reached, but instead of the country importing more machines to supports its growing consumer demand, China is giving the growing business to home-grown suppliers, while those same suppliers export more equipment around the globe.

 

Haitian Plastics Machinery—by volume, the top seller of injection molding machines in the world—raked in record earnings and profits in 2013. Sales, which rose 13.7% to $1.2 billion, actually marked the highest ever level in exports for the company, according to Helmar Franz, Haitian’s chief strategic officer.

 

Franz, who is also a member of the Chinese Plastics Machinery Industry Assn. (CPMIA), discussed Haitian’s results, and trends in the broader Chinese plastics market, at last month’s Chinaplas in Shanghai.  

While China’s exports of injection molding machines have increased every year since 2009, its imports have shrunk each of the last four years, according to CPMIA data cited by Franz.

 

Imports of plastics machines in 2013 were lower both in terms of units and value, dropping 4% to 10,052 units and 15% to $1.82 billion in value. Exports of plastics machines in 2013, however, jumped 94% in volume, to 135,213 units, with their value up 7% to $1.72 billion.

 

Historically, Franz noted that the market had exhibited a 70:30 split in equipment sales between imported machines vs. Chinese. During the 2008-2009 global economic crisis, Franz noted that Chinese processors turned to domestic machine suppliers, and they have not looked back.

 

In 2013, 77% of machines were bought locally and Korea was the only country that supplied more machines to China in 2013 than it did in 2012. In 2012, China was a net exporter of machines for the first time ever, with that new status holding in 2013.

 

The ratio of imported machinery to domestic, going back to 2008, seems to have shifted permanently.

 

Per CPMIA (import : domestic)

 

2008 : (51:49)

2009: (29:71)

2010: (28:72)

2011: (28:72)

2012: (27:73)

2013: (23:77)
 

China's Machinery Imports by Region (China Customs, Millions USD
Top Countries '09 '10 '11 '12 '13
Japan 423 749 775 710 595
Germany 373 512 627 617 582
Taiwan 111 242 236 288 188
South Korea 61 100 112 116 123
Italy 74 121 134 109 95

 

 

 

 


 

Chinese Imports of Plastics Machinery (USD Million)
2009 2010 2011 2012 2013
575 996 912 872 735

Chinese Exports of Plastics Machinery (USD Millions)
2009 2010 2011 2012 2013
370 637 840 921 951

 

‘Sqrounds’, ‘billboard’, and why in-mold labeling is starting to take off

By: Tony Deligio 20. May 2014

Long held up as a technology to watch, in-mold labeling (IML) had failed to win the same popularity in North America that it enjoyed in Europe, but is that now changing thanks to a growing packaging format and shelf-appeal-focused point-of-purchase product marketing?

 

Business is booming at custom automation supplier CBW, Fort Collins, Colo., and that success is due in no small part to increased interest in IML systems, particularly for square/round “sqround” containers that are increasingly showing up on retailer shelves.

 

Sqround, or rather sqround™ (the term was trademarked by Berry Plastics in 1995), refers to containers that are largely rectangular in shape, save for their corners, which are rounded. This style of package replaced strictly round containers, which were most easily decorated via pad printing, or in the case of ice cream, coated paperboard bricks (much to some folks’ lament).

 

Jim Swim, business manager at CBW, has multiple sqround packages at the ready as props in his Fort Collins office to help explain the phenomenon. “In the old days, the market would have  a cup—a round cup—so we would mold these,” Swim says, “then we’d take them out and they’d got to a printer. But when you start getting something like this,” Swim says, pulling a rectangular sqround from his shelf bearing a very familiar brand name,  “you can’t print them real fast, it doesn’t spin.”

 

Swim says CBW delivered its first IML system in 2005, and since then, the market has taken off with 70 and counting operating in a variety of markets. “[Sqround containers] are required from the Big Box stores,” Swim says. “They can get more of these on a shelf and then they can have more visualization for the customer. This is where these markets have emerged based upon the requirements of the Wal-Mart’s or the Target’s of the world, because they want to maximize the product on the shelf and maximize the exposure of the product, which is where IML really helps.”




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