As injection molders and extruders use more processing barrels, competition among Virginia- and Wisconsin-based barrel manufacturers has risen to a new level. Barrel business at market leader Xaloy Inc. is growing at 30 percent a year. Second-place Wexco Corp. has outgrown its plant, and small-but-aggressive newcomer Inductametals Corp. is doubling its capacity. Other competitors include Bimex Corp. and Wisconsin Bimetallic Inc., both of Wales, Wis.
In tackling the entrenched plastics-industry niche market, Inductametals recorded 1994 sales of $2.4 million and anticipates doubling in volume by the end of 1995, according to Harold Sherman, president. Sales in 1993 were less than $1 million.
George Thompson, general manager of Inductametals' Germantown, Wis., plant, said that about 70 percent of the company's business is supplying injection molders, and about 30 percent is supplying extruders.
The company is spending $2 million to double capacity and enhance its bimetallic-cylinder casting operation to match a sophisticated machining capability. Casting occupies 5,000 square feet, and machining, 25,000 square feet.
The company credits induction-coil casting for the wear resistance of its Ultramax anti-abrasive alloy barrel, introduced in mid-1993, and IDM-260 anti-corrosive alloy extrusion barrel, first sold in 1990. More than 500 Ultramax barrels are in use, according to Gerard Riley, marketing director.
A proprietary casting process rapidly fuses the alloy and backing cylinder. The tradition in the U.S. industry is furnace casting. IDM said its process creates ``an abrasion-resistant alloy lining with richer and more-even carbide distribution,'' and produces ``a barrel that combines the endurance of a solid alloy with the economy of a bimetallic.''
The business was founded in 1987 to find industrial applications for induction heating to coat base metals with high-performance alloys. Theodore H. Krengel, now chairman and chief executive officer, headed an investment group that recapitalized the Chicago-based company in 1991.
Researchers looked at oil and food processing applications before targeting the plastics processing market. More use of heavily filled materials increases cylinders' susceptibility to abrasion or corrosion, Riley said.
In Germantown, IDM employs 30, including several workers formerly with Wexco. In Chicago, IDM employs five in administration, and five in sales. Six agencies represent the company.
Inductametals has yet to impress the dominant market leader.
``What they do is not new,'' said Gunther Hoyt, vice president of marketing of Xaloy, based in Pulaski, Va.
``Bernex, our sister company in Switzerland, invented induction casting technology in 1967,'' Hoyt said, ``and Xaloy developed carbide barrels with our X-800 in 1972.''
Hoyt said the industry is moving to ``a more holistic view of barrel design from focusing only on alloys.'' Xaloy works with machine builders to design barrels that withstand higher pressures and can be installed more easily.
He attributes Xaloy's competitiveness in part to its steel-technology-backed alloys and design engineering expertise.
``Barrels are not just about alloy and wear life,'' he said.
Xaloy makes extruder and injection molding barrels, screws and nozzles and anticipates 1995 sales of about $45 million, Hoyt said. Xaloy experienced growth of more than 26 percent in 1993 and 1994 with barrel sales growing faster than screw sales.
Xaloy employs 301, including 14 in sales. The 102,000-square-foot barrel facility in Pulaski has 230 employees and uses four technologies: two types of induction heating, hot isostatic presses and gas-fired furnaces.
Another 71 people work in Xaloy's 32,000-square-foot screw manufacturing plant in Newburyport, Mass. Xaloy has a worldwide network of 32 sales agencies.
Xaloy's history goes back to the then-innovative Industrial Research Laboratories in the 1930s. Saurer Group of Zurich, Switzerland, acquired Xaloy in December 1991.
Saurer's Bernex unit, which has sales of about $18 million, specializes in large injection barrels to mold dumpsters and for other oversized applications.
The next-largest U.S. firm, Wexco, manufactures bimetallic injection, extrusion and food processing barrels for original equipment manufacturers and most North American screw manufacturers.
Wexco does not make tips or screws.
``We forecast 10-15 percent [annual] growth, and we've been doing that since 1977,'' said Jack L. Congrove, president of the Lynchburg, Va., firm.
Wexco employs 167 and finds difficulty hiring machinists in its current tight labor market.
``Our 48,000-square-foot facility is about as full as it can get with machinery and work in process, and the next step is to expand in the near future,'' Congrove said.
The company has occupied the facility since 1985.