TROY, MICH. — Patrick Kirby is back where he began 13 years ago, when he created Megatech Engineering Inc. from the garage of his Troy home.
Since then, the automotive design and engineering firm has burgeoned to more than 800 people, taken over an entire city block in Warren, Mich., and was swallowed by auto interior supplier Becker Group Inc. of Sterling Heights, Mich., in 1989.
Kirby, in turn, became an executive vice president with Becker Group, a large plastic injection molder. Megatech fanned out to work on numerous Big Three programs, including designing the interior of Chrysler Corp.'s retro Plymouth Prowler sports car.
But in August, Kirby left Mega-tech after a long-simmering falling out with Becker management. Two months later, he started up a new design and engineering firm, PGK Engineering in Troy.
For Kirby, 50, it was the second time around with a start-up company. But instead of working from his garage, he leased a small, 12,000-square-foot office in an industrial park and set about building a new business.
``I know when I left Megatech that this is what I should be doing,'' Kirby said. ``But this time around, it should be easier. I already have the relationships with suppliers that I didn't have in 1985.''
Kirby plans a program of growth as ambitious as those he had at Megatech, which is now a PGK competitor. He is offering plastic injection and compression molders fully integrated program management services. The firm will take a product from concept to launch with all the steps in between: design, tooling, modeling, predictive engineering, fixturing and secondary operations, rapid prototyping and pilot production. Those capabilities form the fence posts under the PGK banner.
Not that PGK plans to do it all under its one confining roof. Since October, when the company was founded, Kirby has leased a second building a few miles from the headquarters to make fixtures, gauges and prototype models, and added an in-house staff of about 50.
In March he purchased Centennial Mold Inc., a Sterling Heights, Mich., injection and compression toolmaker, and Milford Manufacturing Corp., a Milford, Mich., maker of anti-lock brake valve bodies that offers metal mills for machining. Those two companies added another 175 people to PGK's roll, about 125 from Milford and 50 from Centennial.
Kirby also has allied himself with rapid prototyping house Auburn Engineering in Auburn Hills, Mich., and advanced development center Specialty Vehicles Inc. of Troy.
With the raft of acquisitions and new buildings, PGK expects its sales to reach at least $22 million to $25 million this year, Kirby said. Of that, Centennial brings about $5.5 million, and Milford about $15 million.
Becker Group forced Kirby's hand, he said. The company's pace had escalated to the point that Kirby was working closely with General Motors Corp. and other major auto suppliers on many new projects and shuttling back and forth to Europe several times a month.
However, last year, Becker Group President Charles Becker deemed that Megatech should no longer work with any suppliers but Becker, Kirby said. That, and the fact that some suppliers were hesitant to work with Megatech because it was owned by a competing supplier, put the brakes on the company's growth, he said.
``It wasn't the best situation for me anymore,'' Kirby said.
Kirby was asked in August to take a different management role with Becker that would pull him from Megatech. Instead, he chose to resign, he said.
``Otherwise, they would have left me on my own little island within the company,'' he said. ``I wasn't in a very good position.''
Along with his other responsibilities, Charles Becker now runs Megatech. Becker was out of the country last week, and Megatech officials would not comment on Kirby's departure.
Several former midlevel Becker Group and Megatech employees, including three design and engineering directors, have joined Kirby at PGK. In addition, Centennial's president is Leo Jensen, formerly head of Becker's J.B. Rath Co. tooling subsidiary. Jensen said he left Becker in March after tiring of the travel pace.
Still, the company is a distance apart in sales from Megatech, a $75 million business. And Kirby faces stiff competition from other engineering firms—such as $400 million-in-sales MSX International Corp. of Auburn Hills, Mich.—and from the engineering departments of those companies PGK would like as customers.
Many auto suppliers, especially those making interior systems, already operate extensive design and engineering centers. Lear Corp., for instance, is preparing to open a spacious new building this year on its Southfield, Mich., campus that will feature modeling, design and prototype testing.
Like Lear, Glendale, Wis.-based Johnson Controls Inc. does little work with outside engineering firms, said spokesman Jeff Steiner. The company already has three major engineering-based technical centers — in Plymouth and Holland, Mich., and Burscheid, Germany — covering more than 1 million square feet, he said.
``We're now responsible for the overall design of a piece,'' Steiner said. ``We don't have to produce everything ourselves [for an interior system] but we need to do our own design and engineering to make a better product.''
Kirby is banking that automakers' increased reliance on large suppliers for design will work in PGK's favor. The company can lower a supplier's costs by taking on those responsibilities, he said.
However, finding sufficient work is another matter, said David Cole, director of the Office for the Study of Automotive Transportation at the University of Michigan in Ann Arbor, Mich.
``It's an elusive market,'' said Cole, who also sits on the board of MSX. ``Instead of calling on the Big Three, now, all of a sudden, there are thousands of suppliers doing design work.''
However, Cole said that many companies are evaluating how to manage design work, whether it be in-house or outsourced.
``The new rule is if they build it, they have to design it,'' Cole said. ``They have to have the capabilities, but some suppliers are running for their lives right now trying to control costs.''
Into that market comes PGK, which operates about 15 computer-aided design and engineering stations at its Troy headquarters and about a dozen more at Centennial.
Its arsenal also includes making clay models, pressboard and machined metal prototype castings and hand-layup design aids made from carbon-fiber materials. PGK also performs environmental cubing, a process where an entire interior is rendered into a miniature model.
The company is planning a move into areas such as heavy trucks and watercraft, Kirby said. It also plans, through Centennial, to develop the nickel vapor deposition tooling process. The technology, using a special nickel tool, can considerably cut down mold production time, Kirby said.
Kirby said he is considering other purchases to expand PGK. However, he couldn't envision the company ever monopolizing an entire street the way Megatech has.
``It's different today, and you don't need as much space,'' he said. ``We can come up with simple solutions using high-tech computer data and without making as many physical models.''