With a slew of new contracts in hand, Walbro Automotive Corp.'s blow molded fuel tank business is taking off. The Auburn Hills, Mich., company will spend $45 million for 10 Krupp Kautex double-shuttle blow molding machines to coextrude six-layer plastic fuel tanks at its plants worldwide, said Dan Hittler, chief administrative officer for parent Walbro Corp. The machines will be phased in during the next two years.
One of those Krupps is headed straight for Walbro's blow molding plant in Ossian, Ind.; another for Meriden, Conn., where the company will start its second U.S. blow molding operation, and its eighth globally, in April 1997. A ninth blow molding plant - previously unannounced - being built near SÃo Paulo, Brazil, also will receive a machine this year to begin making six-layer tanks for an undisclosed international carmaker, Hittler said from Walbro Corp. headquarters in Cass City, Mich.
At Ossian, which currently operates two Krupp Kautex machines, both single- and double-shuttles, Walbro is adding 40,000 square feet to bring on four more lines, with construction beginning this summer. The company will install one machine there this year, with the rest following as business dictates.
The new double-shuttle Krupp will boost fuel tank capacity at Ossian to 1 million units a year, Hittler said. With all six Krupps in place, capacity will total 2 million tanks.
Since late 1994, when its first token piece of blow molded tank business - for Ford Motor Co.'s Windstar minivan - started at Ossian, Walbro has built that business into a full-throttle global operation. Before the auto contracts picked up, the Ossian plant used its extra capacity to help sister outfit U.S. Container Inc. of Maumee, Ohio, blow mold multilayer plastic shipping drums.
Hittler put last year's fuel tank sales at Ossian at roughly$3 million - a ``fairly modest'' sum ``because we only had one tank,'' he noted. Projections for 1996 approach $10 million. By 2000, tank sales at the plant should be pushing $100 million, he said.
The Ossian expansion is tied to the six-layer technology and several new contracts, including a whole series of light-truck productions for General Motors Corp., he said. The GM list is substantial, beginning with two 1998 vehicles-with an order for more than 500,000 six-layer plastic tanks coming on in May 1997-and running through the model-year 2000, he said.
In October, the Ossian plant began making the first-ever six-layer tanks for the new Ford Escort. New fuel evaporative emissions standards prompted Walbro to develop the technology, which uses an impenetrable barrier of ethylene vinyl alcohol to eliminate the transfer of hydrocarbons from inside to out, he said. Typical monolayer and three-layer plastic tanks-which use a layer of regrind-are permeable and do not meet regulations being phased in by the Environmental Protection Agency; steel does. By 1998, all passenger cars must comply with those standards, he said.
``We've been working on a fuel-tank solution for over five years,'' since California first proposed its automotive emissions standards, setting the direction for the rest of the country, he said.
About a decade ago, Japan spearheaded five-layer technology with a nylon barrier for plastic tanks in both Subaru and Nissan vehicles, he said. Despite its 10-year lead on the industry, Japan didn't do much with the technology, according to Hittler.
Walbro uses EVOH instead of nylon for its barrier, because nylon swells with methanol and ethanol, causing the adhesive layers to deteriorate, he said.
The company was supposed to launch its first six-layer tanks with GM's 1996 GMT600 chassis/cutaway applications, but GM delayed their production.
``This business takes staying power,'' Hittler said, waxing philosophical about the time involved in getting the business, waiting for production to start ramping up.
New Chrysler Corp. business has prompted the company to install blow molding capacity in Meriden, where it injection molds fuel rails. Chrysler signed Walbro to make 120,000 six-layer tanks for a 1998 sport-utility vehicle it will build on the East Coast. With that project set for April 1, 1997, Walbro will add about 50,000 square feet to accommodate three Krupp machines-capacity for a million tanks a year-at its 150,000-square-foot Meriden plant.
Walbro also has won a contract to make plastic fuel tanks for Mercedes-Benz AG's C-class cars, priced in the $50,000 range. Those monolayer tanks, being made in Ettlingen, Germany, soon will be converted to the six-layer technology, mainly so Mercedes can export the cars to the United States. Both the Mercedes connection and the Ettlingen plant were acquired in July when Walbro bought the tank division of Dyno Industrier AS of Oslo, Norway, picking up a hefty share of tank business, and six European facilities.
European operations, based in Paris, are headed by Jean Marie Julien. The company is planning to create a systems engineering center in Strasbourg, France.
Since the Dyno purchase, Walbro has set some lofty goals. In seven years it plans to be able to supply carmakers with the entire fuel supply and delivery system, from fuel cap to injector, either by making or buying the parts it does not make now, Hittler said.
Walbro attributes its U.S. success to its six-layer technology.
The Krupp Kautex double-shuttle machine not only has twice the capacity of a single shuttle, but it can run two different molds simultaneously. The six-layer tank calls for an inner and outer skin of virgin high density polyethylene; an inside layer of HDPE regrind; and two adhesive skins that sandwich the EVOH barrier.
Since November 1994, the Ossian plant has been making three-layer 20-gallon tanks, which sandwich HDPE regrind between virgin layers, for the Ford Windstar minivan. But even the Windstar tank will be converted to six layers within the next 18 months, Hittler said.
Ford, another Krupp Kautex customer, also has the six-layer machines on order, he said. But, he said, the automaker needs 4 million tanks a year worldwide, and its capacity at Milan, Mich., where it makes the tanks, is about 1.2 million.
``We do not consider Ford a competitor,'' he said.