After a precipitous drop in the second half of 2008, custom injection molders’ average machine-hour rates held firm in the first half of this year.

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After a precipitous drop in the second half of 2008, custom injection molders’ average machine-hour rates held firm in the first half of this year. June responses to our semi-annual survey by 102 plants nationwide moved our Hourly Rate Index up a barely perceptible 0.3 percentage points. Average machine capacity utilization also held even at the December level of 47%, though that is still the lowest level in 26 years of surveys. Also unusual was the remarkable uniformity of capacity utilization across all regions of the U.S.

 

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%
17.9%
31.8%
100-299
8.3%
13.7%
26.1%
300-499
7.1%
11.5%
22.1%
500-749
5.7%
9.8%
18.7%
750-999
5.7%
13.6%
20.3%
1000+
6.5%
14.7%
16.1%
aCumulative national averages over many surveys.

Custom molders reported some optimistic signs. Twice as many respondents (16%) raised their rates in the first half as lowered them, though 76% did not change their rates at all. Also, 31% of molders saw increased capacity utilization, twice as many as in December, vs. 49% who had lower utilization (down from 62% previously). And 45% of molders expected business conditions to improve in the short term, vs. 22% who expected business to worsen and 33% who predicted no change. That was the highest level of optimism and lowest level of pessimism seen in two years.

 

The complete picture is far from rosy, however. Responses from 60 moldmaking shops indicated a 20% decline in new orders in the first half after a 17% drop in the previous six months.

 

This Hourly Rates survey is the first we have conducted in cooperation with market information and consulting firm Townsend Solutions of Houston. 

 

 

CUSTOM INJECTION MOLDERS' MACHINE-HOUR RATES 
WITH OPERATOR, PROFIT MARGIN INCLUDEDa (102 PLANTS)
Dollars Per Hour (High/Average/Low) 2nd Quarter 2009
Tonnage Range
<50
50-99
100-299
300-499
500-749
750-999
1000-1499
1500-1999
2000-2999
3000+
Indexb
Northeat
(ME, NH, VT, MA, CT, RI, NY, NJ, PA)
$68.20
$70.00
$68.20
$68.20
$77.14
      
$41.19
$43.12
$46.37
$53.18
$72.67
     
96
$23.40
$24.57
$26.91
$40.95
$68.20
     
 
Southeast
(DE, DC, FL, GA, MD, NC, SC, VA, WV)
$50.00
$68.20
$81.84
$90.00
$81.84
$68.30
    
 
$35.13
$42.63
$49.83
$57.42
$60.08
$63.38
    
95
$27.55
$30.86
$39.63
$39.67
$48.72
$58.46
    
 
North Central
(IL, IN, MI, OH, WI, IA, KS, MN, MO, NE, ND, SD)
$150.00
$181.35
$115.94
$136.40
$148.68
$171.86
$170.50
$272.80
$341.00
$409.20
 
$38.18
$47.22
$48.71
$59.43
$73.62
$98.13
$98.60
$157.08
$274.98
$339.29
100
$15.00
$15.00
$20.00
$20.00
$36.50
$40.00
$43.99
$51.95
$230.32
$269.66
 
South Central
(AL, KY, MS, TN, AR, LA, OK, TX)
$45.00
$60.00
$65.00
$60.00
$85.93
 
$154.13
 
  
 
$32.31
$37.99
$43.80
$45.92
$62.21
 
$154.13
 
  
85
$20.00
$23.40
$29.25
$32.74
$38.61
 
$154.13
 
  
 
West
(CA, OR, WA, AK, HI, AZ, CO, ID, MT, NV, NM, UT, WY)
$70.00
$82.65
$98.08
$100.00
$134.55
$90.68
$87.50
$108.23
  
 
$36.35
$41.95
$49.41
$56.74
$71.30
$82.75
$86.17
$107.87
  
96
$10.19
$13.69
$15.95
$31.59
$46.80
$74.30
$84.83
$107.50
  
 
National Averagec
$37.72
$43.88
$47.86
$55.82
$70.46
$88.61
$103.98
$141.59
$274.98
$339.29
 
Average Change in Hourly Rates In First Half 2009: +0.3%
a An adjustment factor is used where data do not already include profit and labor. b Relative 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.