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China's Jinming looks at German R&D base

By: Steve Toloken

October 25, 2013

Chinese extruder maker Guangdong Jinming Machinery Corp. is considering starting a German research and development center to internationalize its product development, two months after announcing a sales partnership with U.S.-based Davis Standard LLC.

Jinming also earlier this year doubled its manufacturing capacity to about 300 extrusion lines a year by opening a new $50 million facility at its Shantou, Guangdong province, headquarters, according to Kelvin Wang, vice general manager and board member, in an interview at the K fair in Germany.

The company wants to globalize its business, and sees a new research and development base as an important step, Wang said.

Jinming plans to build the new research facility in either Germany or China, but it recognizes that it could be more difficult to bring engineers and researchers from other countries to live in China, he said. It wants to have the new R&D center up and running by the end of 2014, he said.

Jinming has watched how a German base has helped China's largest plastics machinery maker, Haitian International Holdings Ltd.

"We also consider like Haitian to establish a partnership outside of China," Wang said. "Jinming is known as a very successful Chinese manufacturer of blown film. The next step is to bring more technology and value to the machine while maintaining the lower cost."

Wang said the company wants to build up its reputation in world markets.

"You have to be known," he said. "If you are a question mark, no one will buy from you. As a blown film maker, we are relatively young."

The public company was established in 1987, and has sales of about $45 million a year, Wang said. About 70 percent of its business is in China, with its major export markets being the Middle East, Southeast Asia and recently, Japan, he said.

At its booth at the K fair, held Oct. 16-23 in Düsseldorf, Germany, it was showing a five-layer polyethylene blown film extrusion line, with a maximum roller width of 1700 millimeters.

"We are not saying we have the best technology for blown film in the world, but we believe we have cost advantages," he said.

The company sees opportunities to sell its machinery through the partnership with Davis-Standard and that company's global sales force, Wang said.

The two companies signed an agreement in August to represent each other's machinery in their markets, with Davis-Standard becoming the exclusive distributor of Jinming's blown film lines in Europe, Africa, Australia/New Zealand, and the Americas.

Wang said the companies are not integrating their technologies but the agreement could be expanded beyond sales in the future.

In an interview in the Jinming booth at the show, an executive with Pawcatuck, Conn.-based Davis-Standard declined to comment on what might be the next steps, if any, in the partnership, noting that it was only finalized two months ago.

Thomas Kennedy, vice president and general manager of blown film at Davis-Standard, said there were opportunities to sell Jinming equipment in "mid-range" markets.

Jinming said it has sold 1,000 extrusion lines in the last 25 years. Earlier this year it bought majority control of another extrusion equipment maker in Shantou, to expand into the equipment market for biaxially-oriented polypropylene, Wang said.