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Time: 2017-02-17

 

glue

Net news: as early as in 1990, that is, the second year of the founding of the United States plastic news, the global sales of injection molding machines for 33,000. In 2013, the global sales of injection molding machines has reached 86,500 units, up by 250%.

 

This huge increase, to some extent, reflects the spread of plastic materials. Compare that to the amount of PET beverage bottles used then and today, or the amount of plastic used in cars.

 

But by some key measures, Asia's manufacturing boom is responsible for the huge leap forward in the global plastics industry. It started with China and India

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Asia's major producers have become the world's factories, and now the consumer class in emerging regions is growing.

 

One key statistic: the world now sells 53, 000 more molding machines a year than it did 25 years ago.

 

As part of the 25th anniversary of plastic news, we wanted to explore what globalization means for plastics manufacturing. China drives growth

 

The simplest answer is that, as the Numbers show, globalisation has brought growth. Globally, the plastics industry is several times bigger today than it was 25 years ago. Global resin consumption was 288m tonnes in 2012, compared with nearly 100m tonnes in 1989.

 

That is much faster than the global population, which has grown 40 per cent in the past 25 years, from 5.2bn to 7.2bn.

 

But growth from globalisation is only part of the story. We can see the remarkable shift of manufacturing center to Asia through digital analysis.

 

China has the lion's share. China's annual consumption of injection molding machines rose from 4,000 in 1990 to 42,000 in 2013, half the global total.

 

Sales in other Asian countries, including Japan, India and southeast Asia, rose to 21,500 units a year from 11,500 in the same period.

The figures come from engel, which is the world's largest maker of injection moulding machines by turnover. Plastic news focuses on these Numbers because injection molding machines are a niche segment of the plastic machine market.

 

The rise of Asia has been devastating for some small and medium-sized U.S. plastics processors, said MikeWalter, President of the Indianapolis, u.s.-based plastics processors association.

 

"Initially, globalization eroded our customer base," says Walter, President of metplasticsinc., an injection molding company. This has spooked the industry.

 

"As representatives of small manufacturers with only one plant in the United States, our customer base is moving overseas," he said.

But that has changed as production costs have risen sharply in China and other Asian countries and as surviving us processing companies have been forced to upgrade their competitive skills and invest more in automation and technology.

 

MET's small injection-molding plant outside Chicago, for example, has seen sales per worker rise by 20% since 2008, as the company has cut staff and boosted sales over the past five years. "Home-grown production is now an attractive opportunity," he said. The European and American markets remained stable

 

While Asia's injection molding machine market is booming, engel's figures show that the U.S. and Europe have maintained modest growth over the past 25 years. The European market fared slightly better, with annual sales of injection molding machines rising from 9,500 in 1990 to 11,500 in 2013, while sales in the americas (including north and South America) grew less, from 7,500 to 8,500.

 

There are opportunities for companies with the ability to expand globally. Engel says it has a big presence in Asia.

 

The company said it had less than 5 per cent of the Asian market in 2004, but has increased its share to 10 per cent this year after building factories in South Korea and China. ChristophSteger, chief sales officer, says companies that weren't a target 25 years ago are now big customers.

 

South Korea's samsung, for example, has become engel's global client in recent years. "On the one hand, the customer base is more global than it was 25 years ago," he said. But Steger believes innovative midsize plastics processors in mature markets like the United States will remain important.

 

On the other hand, there are still a lot of small and medium-sized companies in Europe and the United States that are typically not looking to expand abroad. They are unperceived forces in their own niche, in their own region.

 

For Engel, that means keeping an eye on these two segments of the global market, Steger said. We can't just focus on the big multinational companies, and then we'll be too dependent on them."

 

And direct comparison of injection molding machine sales figures by region is also misleading. Many injection molding machines in Europe are several times more expensive and offer more features than the typical models sold in China, Steger said.

 

Even in the americas and Europe, engle expects some small global trends, such as the rise of emerging markets like Russia, Turkey and Brazil. In Europe, for example, ten years ago the local market for plastic machines was Germany, followed by Italy and France.

But Italy and France fell out last year, while Turkey and Russia became Europe's second - and third-largest injection molding markets.

 

Germany still leads the European market, and engel expects it to retain that position in Europe's injection molding market by at least 2020, followed by Russia and Turkey.

 

In the americas, a similar shift is expected: by 2020, engle expects Brazil to overtake the United States as the biggest market for plastic machines. Of course, emerging-market companies have their own pressures in global markets.

 

Chinese injection-molding Machinery maker Guangdong Yizumi Precision Machinery Co., ltd. bought the assets of bankrupt u.s.-based HPM in 2011 as part of its efforts to expand in the global market.

 

Yi zhimi's CEO zhen ronghui told us plastics news last year that he believed HPM's focus on the domestic market rather than aggressive global expansion was one of the mistakes that led to the bankruptcy of the 135-year-old company.

 

"We want to globalize and avoid the same problems," he said. Over the next 25 years

What is clear is that the global development of the plastics industry has been an important part of growth over the past 25 years, following changes including China's accession to the wto, the reunification of Germany, the rise of multinational companies and various economic crises. That's one of the challenges.

 

Global competitive pressures are driving the "new industrial revolution," including the creation of anthropomorphic robots, 3D printing and more efficient supply chains, according to a survey released in October by the alliance for manufacturing productivity and innovation.

 

"Analysts believe that the current era of technological disruption opens a new chapter for U.S. manufacturing," the report said. But they also acknowledge that "some people are concerned about the impact of new technologies on employment."

 

The future of U.S. manufacturing will depend on its ability to adapt to new technologies, according to a 2014 survey by the brookings institution, but the study also cited another worrying trend from the past 25 years. Excluding computers and electronics, 90% of American manufacturers grew at an annual rate of just 0.6% from 1987 to 2011 (minus 0.4% from 2000 to 2011).

 

When computers and electronics are included, U.S. manufacturing grew an average 2.6 percent from 1987 to 2011, the survey said.

For sales of injection molding machines and other capital

equipment

Steger, of engel, says he thinks the *** impact of global competition is that manufacturers are increasingly inclined to offer better value for money.

"Services, better services and better performance are what they value most," Steger said. And bargaining is getting harder and harder."