LONG BEACH, CALIF. — Maguire Products Inc. was set to sell $250,000 of its gravimetric blenders to one of Thailand's largest molders when the economy of that Southeast Asian nation took a nose dive.
The Thai molder's stock sank by 50 percent, and since the company had borrowed against the value of its shares, Maguire's deal was dead.
``It's clear that everyone I've been exposed to in Thailand is trying to weather a crisis,'' said B. Patrick Smith, vice president of sales and marketing for Anaheim, Calif.-based Maguire. ``Asia is a disappointment because it was our next frontier.''
Anecdotes about canceled deals caused by the economic downturn in Asia peppered conversations at the Western Plastics Expo in Long Beach, one of the largest plastics shows this year on the U.S. side of the Pacific Rim.
But among those companies getting pinched, most said strong growth in other markets was making up for lost business.
United Calibration Corp. is finding that business in the United States is making up for the significant slowdown in South Korea, but only because the company shifted the focus of its sales force in early 1997.
The company began to focus more on the U.S. market starting in February, when the South Korean economy showed signs of slowing, said Jere Watson, president of the Huntington Beach, Calif., company.
The firm sold 25 machines a year there several years ago but only did four or five in 1997, Watson said.
Other companies — extruder maker Processing Technologies Inc. and auxiliary equipment manufacturer Sterling Inc. — said pending deals they had in South Korea either have been put on hold or scrapped.
Firms are watching China closely to see if the government continues to allow investment.
``A lot of the business in China is brokered through the government and if they decide the banking system can't handle it, they may cut it off,'' said Patrick Klingberg, marketing manager for Milwaukee-based Sterling, which is beginning to test the Asian market.
Hot-runner maker Mold-Masters Ltd. is taking another approach, expanding its Japanese plant, said Wayne Stoddard, trade show coordinator for the Georgetown, Ontario, firm.
Asia has proven a difficult market, but mainly because of poor patent protection laws, he said. But Germany and North America are strong markets, even if Asia starts to suffer, Stoddard said.
``We have business there,'' he said. ``It's long-term. We'll continue to support it.''
One injection molding machine maker based in the Far East said business in Southeast Asia started to suffer last year, but other markets have picked up the slack. The machinery official, who did not want to be identified, said China remains a growth market but will not be growing as fast next year as in past years.