Less than 18 months after arranging an intercontinental marriage to help both companies grow in North America, automotive suppliers Compagnie Plastic Omnium SA and Becker Group Inc. want to dissolve their 50-50 joint venture.
The two companies—under the name P&B Automotive LLC—jointly operate a 109,000-square-foot injection molding plant in Anderson, S.C. Paris-based Plastic Omnium had opened the plant a year before forming the venture with Becker Group of Sterling Heights, Mich., in November 1996.
Under the arrangement, P&B had purchased the plant, Plastic Omnium's first in North America, plus a Troy, Mich., engineering office. Plastic Omnium continues to make coextruded fuel tanks separately at the facility.
Now, both companies say they want a divorce. Plastic Omnium will buy Becker Group's 50 percent interest in P&B and continue solo in North America, said P&B Automotive President Phillipe Claye, who also runs Plastic Omnium's North American operations.
The purchase for an unspecified price was scheduled to be completed by July, Claye said.
Plastic Omnium recorded about $80 million in North American sales last year, including the P&B venture, Claye said. Sales from the P&B venture alone were not disclosed, although sources believed the total to be at least $10 million to $15 million.
The Anderson plant has five injection presses, each with a clamping force of 3,000 tons, Claye said. The South Carolina facility also operates three Krupp Kautex blow molding presses to make Plastic Omnium's six-layer fuel tanks.
Originally, the P&B venture was expected to be a heavenly made match for both firms. Plastic Omnium had wanted to work with an experienced supplier to ease its pioneering move to North America. Meanwhile, Becker Group, known for its interior parts, wanted to enter the exterior market.
Yet, those advantages seemed to sour over time. Plastic Omnium, a major European parts producer, found it could aggressively find new exterior business in North America by itself, Claye said. New contracts with General Motors Corp. and Volkswagen de Mexico SA have eased its transition.
The French company opened a 30,000-square-foot plant in Puebla, Mexico, in September and plans to build another facility near a GM site in Ramos Arizpe, Mexico, by the year 2002, Claye said. The company also is considering expanding further in the United States, he said.
``There are no hard feelings,'' Claye said. ``We just recognized that our strategies are much too different, and it's best to go our own way.''
A top Becker Group official, who did not want his name used, confirmed that the split was over strategy differences. The Michigan supplier wanted to bank its future on interior parts—the firm has made interiors for Chrysler Corp.'s Plymouth Prowler and other vehicles—and in such areas as design and engineering, he said.
``We weren't in agreement on strategic issues,'' he said. ``[The joint venture] is our only exterior business, and it's not part of our overall strategy.''
For interior work, Becker Group is finding new alliances. In October, the company formed a joint venture in SÃŒo Paolo, Brazil, with molder Eldorado Industria Ltda. to mold polypropylene instrument panels, the Becker official said. The parts will be made from Eldorado's existing plant and be used for GM's Opel Astra and Mercedes-Benz AG vehicles.
The company also plans to form a similar joint venture in Bangkok, Thailand, to make interior parts. However, that agreement is on hold until the economic situation in Asia settles down, the official said.
Becker Group recorded $380 million in North American injection molding sales during 1997, according to recent figures submitted for Plastics News' upcoming injection molders rankings.
Plastic Omnium also plans to move ahead in exterior parts. The Anderson plant will supply GM with exterior trim and blow molded fuel tanks for its new line of minivans and its Chevrolet Corvette. In Mexico, the company supplies fuel tanks and bumper fascias for VW's new Beetle, produced at a nearby plant.
The company expects to eclipse the $100 million sales mark in three years, Claye said.