DRTS moves molding operation from California to India

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: December 16, 2013 5:50 pm ET
Updated: December 16, 2013 5:51 pm ET

Related to this story

Topics Injection Molding, Asia, Agricultural

American irrigation equipment maker DRTS Enterprises Ltd. closed its injection molding operation in California last month and moved the work to India.

The company said the sharp slide in India’s currency made its U.S. production uncompetitive.

India’s agricultural industry was the major market for the company’s U.S. molding operation, which had six all-electric presses. The plant molded irrigation drippers, which were used in machinery that San Diego-based DRTS also manufactures.

But the rupees’ drop from 45 to the dollar in mid-2011 to more than 60 in mid-December put the U.S. operation in a difficult position economically, even though it was highly automated, said DRTS CEO Doron Mamo, in an interview at the Plastivision trade show in Mumbai.

The company may in the future manufacture some machinery in India, although the currency swing has a much smaller impact on the end of its business, he said.

The company manufactures equipment to make drip irrigation systems, a specialized technology that uses a system of plastic tubing and drippers to deliver small amounts of water directly to crops, rather than flooding a field.

It’s designed to save significant amounts of water over flood irrigation, and the technology is getting a lot of attention in India, which according to Indian government data, has 17 percent of the world’s population but only four percent of its water resources.

“This [India] is our biggest market,” DRTS sales director Edan Shayak said at Plastivision, which was held Dec. 12-16 in Mumbai. “We have sold over 150 production lines in India over the last three or four years.”

Shayak said the U.S. molding operation did well against local Indian manufacturers of drippers, even with shipping costs, until the currency swing: “For three or four years we were fully capable of competing with local manufacturers in India because we were more efficient in the U.S.”

DRTS also has a molding operation for drippers in Turkey, where it has eight injection presses manufacturing for the Middle East, Africa and other markets, Mamo said. The company has invested $3 million in that joint venture facility, where it also has sizable sales and support operations, he said.

In India, the company is not setting up its own factory directly, but rather moving its molds to an Indian injection molding company in Pune. Given the complexity of the drip molds, the key technology is in the mold design, he said.

Mamo declined to identify the local partner but said it’s a “very distinguished Indian company with a background in the automotive industry.”

He said DRTS does not see a need to open its own molding factory in India. The company does not expect the rupee to quickly gain back value, and sees some advantages in serving smaller customers with an Indian operation.

The company has about 25 employees in its U.S. offices and contracts out much of the manufacturing for its irrigation machinery, Mamo said.

While the slowdown in the Indian economy in the last year or two has hurt the company’s business, particularly as customers have a harder time getting financing, he said he believes the country’s government long-term is committed to drip technology.

“I think the commitment of the government to the drip market is clear, substantial and consistent,” Mamo said. “They understand clearly the importance of saving water in a country with over 1 billion consumers.”

Shayak said India has a lot of untapped potential for drip technology, but more education is needed to convince more farmers of its value.

“India is getting there,” he said. “The potential is not reached. They are under 15 to 20 percent of what is possible.”


Comments

DRTS moves molding operation from California to India

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: December 16, 2013 5:50 pm ET
Updated: December 16, 2013 5:51 pm ET

Post Your Comments


Back to story


More stories

Image

Baxter investing $300 million to expand dialyzers production in Alabama

August 29, 2014 12:53 pm ET

Baxter International, Inc. is expanding its Opelika, Ala. manufacturing location to boost production of dialyzers, a key component of hemodialysis...    More

Image

Obituary: Jerry Williams, Prism Plastics co-owner

August 29, 2014 8:50 am ET

Williams founded Prism Plastics with Rod Bricker and Gerry Phillips, after the three left Huron Plastics Group in 1999.    More

Image

Haitian's standardization efforts paying off

August 29, 2014 9:53 am ET

Streamlined design efforts and robust export sales helped propel Ningbo, China-based injection molding machine manufacturer Haitian International...    More

Polish injection molder Teknorubber up for sale

August 29, 2014 9:14 am ET

Polish plastic parts maker Teknorubber has been put up for sale following its insolvency filing in March 2014. The company is to be auctioned through ...    More

Image

Mission Plastics brings new automated work cell on line

August 26, 2014 4:17 pm ET

Custom injection molder Mission Plastics Inc. and a customer have created a $1.5-million automated work cell for a medical diagnostics product.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events