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January 11, 1999 01:00 AM

THERMOFORMING FINDS PLUM IN PACKAGING

Bill Bregar
Senior Staff Reporter
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    New packaging markets and growing demand for larger cut-sheet formers are keeping thermoforming machinery companies humming as 1999 begins.

    Deep-draw soft drink cups — the kind that fit into your car's cup-holder — are becoming a giant thermoforming market. Up until now, those cups have been injection molded from HDPE. Watch for thermoformed polystyrene and polypropylene.

    Dave Irwin, president of International Thermoforming Systems Inc., said new processors are joining the car cup market.

    ``There's more than the traditional cup converters coming forward with bids,'' he said by telephone from ITS' Yakima, Wash., headquarters.

    OMV USA Machine Division President Kent Johansson said his Genoa City, Wis., firm is working with a major U.S. company interested in thermoforming 32-ounce PP stadium cups.

    PP, long popular in Europe, is taking off in the United States, Johansson said. Growing U.S. demand for thermoformed PP — which is displacing some injection molded packaging — continues to create a market for machines with in-mold trimming.

    ``We're seeing a lot of conversion, if you look at the dairy segment of the container business,'' Irwin said. ``We're seeing a switch from injection molded HDPE and PP containers into thermoformed PP containers. That is certainly a trend that is well under way.''

    The switch hits packages like margarine tubs, yogurt containers and deli carryout tubs.

    OMV, the U.S. division of Verona, Italy-based Isap/OMV Group SpA, specializes in total packages for PP, from the extruder to the thermoformer, including parts handling. Johansson said PP, long popular in Europe, is taking off in the United States.

    ``If we can build three times as many machines as we build today, I could sell them next month,'' he said. ``The industry has completely accepted PP for packaging.

    Although PP's growth in food tubs has been well-documented, often lids for the same tubs are still being injection molded. Those lids are the next big thermoforming market, according to Johansson.

    In mid-December, OMV delivered a system to a major European customer that thermoforms lids from pre-printed sheet. Johansson, who declined to identify the company, said OMV will start selling pre-printed systems in the United States early this year.

    Lyle Industries Inc., which makes thin-gauge formers in Beaverton, Mich., enjoyed its ``best year ever, said Brian Crawford, director of sales. ``We surpassed '97 by 20 percent,'' he said. Dual-ovenable trays for prepared food was one growth area.

    Beaverton-based Brown Machine's sales of roll-fed, in-line formers for packaging increased 15-20 percent, thanks in part to new trim-in-place PP machines, according to Vice President Bill Kent. Brown's cut-sheet business increased just 10 percent in 1998, Kent said.

    In business news, Brown and its main competitor, Maac Machinery Corp., as well as Kiefel Technologies Inc., made headlines in 1998.

    In November, Brown Machine got a new owner when a Chicago investment group, Madison Capital Partners, bought John Brown Plastics Machinery from Kvaerner ASA of Oslo, Norway. At the end of the year, Maac announced it was building a new factory in Carol Stream, Ill.

    Kiefel's U.S. operation is now on its own. In 1995, Kiefel, a unit of Germany's Paul Kiefel GmbH, formed a partnership with sheet producer O'Sullivan Corp., called KTI in Hampton, N.H. KTI manufactures and sells thermoforming and welding equipment to automakers. But in December, the arrangement ended when KTI bought back O'Sullivan's 49 percent share. Now KTI plans to increase U.S. sales of machines for packaging and medical products.

    New controls and automation technology have boosted sales for both roll-fed and cut-sheet machines, according to equipment makers. Thermoforming machines are ``smarter'' than ever before. Formers, driven by their customers, need to track the history of each part and run statistical quality control.

    Kent said Brown steadily has improved its controls, adding features such as infrared scanners for statistical process control.

    Maac of Itasca, Ill., produced 46 cut-sheet formers in 1998, about the same number as 1997, said Paul Alongi, owner. But each year, the machines get bigger and can do more.

    ``Our growth really hasn't been in the amount of the machines, but really in the size and sophistication of them,'' Alongi said.

    Meanwhile, rotary thermoformers just keep getting bigger and bigger.

    Brown needed nine flatbed trucks to ship parts of one machine from its assembly plant in Beaverton to Thermoform Plastics Inc.'s new plant in Belmont, N.C. Brown boasted it was the world's largest four-station rotary thermoformer, with a wheel diameter of about 60 feet, and a height of 24 feet.

    A custom former, Thermoform Plastics is using the big machine to turn out things like boat hulls and dunnage trays.

    Big machines are ``booming'' around the world, Alongi said. ``Since the only people that build rotaries are here in the United States, our marketplace is doing real well,'' he said. And the twin-sheet market continues to grow, he said.

    Brad Moore, sales manager for Custom Manufacturers Inc. of Gladwin, Mich., said all Custom's rotary machines in 1998 went into twin-sheet forming. Personal-computer-based controls, an option on all the company's machines, are driving sales, he said.

    While packaging outpaced cut-sheet at Brown last year, Custom experienced the exact opposite result.

    ``We had a really big year in cut sheet and our in-line business was kind of slow,'' Moore said. ``Our market is leaning toward a lot of the automotive parts that are currently being injection molded.''

    Kent's prediction for Brown this year: ``Certainly we have a lot of things out there that look good, at least in the first half. We think in the second half we could see a little adjustment.''

    What about a possible U.S. economic slowdown this year? Packaging seems largely immune—especially given the recent inroads made by thermoforming.

    ``We haven't sensed any downturn,'' ITS' Irwin said in late December. ``Where we see some slowing in traditional accounts, we've been able to offset that by new products and new customers.''

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