Beleaguered gas can manufacturer Blitz USA closing down

By Michael Lauzon
Correspondent

Published: June 13, 2012 6:00 am ET

Related to this story

Topics Blow Molding
Companies & Associations

MIAMI, OKLA. (June 13, 10:15 a.m. ET) — Plastic fuel-can molder Blitz USA Inc. will shut operations after unsuccessfully trying to reorganize under Chapter 11 bankruptcy protection since Nov. 9, according to a company statement issued June 12.

The July 31 shutdown will affect 117 employees at Blitz’s manufacturing plant in Miami, Okla.

The firm plans to liquidate all assets either en masse or piecemeal, external affairs manager Amanda Emerson said in a telephone interview.

“We appreciate the support of our employees and their families in their efforts to reorganize and develop a viable business plan,” said Blitz President Rocky Flick, according to an article in the Joplin (Missouri) Globe. “Unfortunately, we were not able to address the costs of the increased litigation associated with our fuel-containment products.”

In April, Blitz sold its F3Brands LLC business, a major in oil drains and other associated auto products, in a bankruptcy auction sale to Hopkins Manufacturing Corp. of Emporia, Kan. Court documents stated Blitz netted $14.6 million from the sale, which it applied to secured debt.

Blitz has been facing a storm of lawsuits blaming its products for consumer injuries caused by fires. The firm spent some $30 million defending itself in product liability suits and owes $3.5 million in legal fees, Blitz reported in court documents.

Blitz’s decision to sell its assets is subject to approval by bankruptcy court. It sought Chapter 11 protection in Delaware. Wal-Mart Stores Inc., a major retailer of Blitz gas cans, also faces lawsuits.

Blitz has been the dominant producer of plastic gas cans in the United States and claimed 75 percent of the market.

“Other manufacturers face similar uncertainty — putting the industry’s ability to meet the typical spike in demand driven by storms in serious jeopardy,” Blitz stated in a news release.

In the week of June 4 the Portable Fuel Container Manufacturers Association began alerting consumers in hurricane-prone states of a potential product shortage, which increases public safety risk. In times of disaster, consumers rely on portable fuel supplies to operate electricity generators, vehicles, chain saws and other relief equipment.

PFCMA’s legal office is in Sacramento, Calif.

PFCMA has said congressional intervention is needed to stabilize the business environment so PFCMA group members can continue supplying the products necessary for safely transporting and storing gasoline and diesel fuel.

“While it is now too late to save Blitz, adoption of mandatory safety standards could convince others to invest in expanded operations,” the Blitz news release stated.

PFCMA has criticized the U.S. Consumer Products Safety Commission for twice refusing to mandate fuel-can safety standards because it claims that harmful incidences were the result of misuse of the fuel cans rather than a product issue.

Fuel-can producers have adopted voluntarily standards developed by the American Society for Testing and Materials since the 1980s. The standards include container stability and heat resistance, openings and closings, filling and pouring, drop strength, permeability and cautionary labeling.

Labeling, for example, states that gasoline should never be used to start or accelerate a fire. Much litigation resulted from such misuse of the fuel in the containers.

U.S. consumers buy more than 15 million portable fuel cans each year, but that number rises by 30 percent when hurricanes make landfall.

“If gas cans aren’t available, disaster victims will still be transporting and storing fuel, but at much greater risk to themselves and everyone around them,” Blitz stated.

Blitz President and CEO Rocky Flick said the sale process for the Miami assets could take three months.

Other PFCMA members include Midwest Can Co. of Melrose Park, Ill.; No-Spill Inc. of Lenexa, Kan.; Scepter Corp. of Scarborough, Ontario; and the Plastics Group Inc. of Willowbrook, Ill.

“Blitz was very good at what they did,” said Tom Cray, president of No-Spill. “The legal system is what brought them down. Blitz exported around the world and only here [in the United States] were there lawsuits.”


Comments

Beleaguered gas can manufacturer Blitz USA closing down

By Michael Lauzon
Correspondent

Published: June 13, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

Hall of Fame: DeLong spent a career solving blow molding problems

March 22, 2015 6:00 am ET

Robert DeLong has combined mechanical know-how, a chemical engineer's understanding of polymers and hands-on customer skills tinkering with blow...    More

Market Reports

Flexible Packaging Trends in North America

North America represents about 30 percent of the global consumption of flexible packaging. Annual growth in this region is forecast at 4 percent during the next 5 years.

For more insight on growth opportunities, drivers of growth and the outlook for 2015, download this report.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 billion plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our analysts provide insight on business trends, foreign investment, top end markets and plastics processing activity. The report also provides important data on exports, production, employment and value of plastics products manufactured.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

More Events