A market lull for new automotive composite products has spelled the end for a long-time, Toledo, Ohio-based toolmaker.
Modern Tools Inc. has decided to close its doors within the next several months after phasing down operations, said President Thomas Hamstreet. The company will shutter its 100,000-square-foot building and attempt to sell some of its equipment, he said.
Modern specializes in compression tooling used by auto suppliers to mold parts made with sheet molding compound and other composite materials. This year, the activity level had slowed to a crawl, Hamstreet said.
``Our debt load was such that we just couldn't weather the storm,'' he said. ``Typically we can fill the hole with new repair work. But [compression] molders are busy right now, and there's not a lot of inventory for repair.''
Ironically, SMC molders — including Cambridge Industries Inc. of Madison Heights, Mich., and Budd Plastics Co. of Troy, Mich. — have plenty of work, Hamstreet said. But many new products have been on hold for six to nine months, he added.
With Modern's exit, the field of automotive compression toolmakers becomes even more limited, said Greg Slyman, president of compression mold maker Richard O. Schulz Co. of Elmwood Park, Ill.
Only a handful of Canadian and U.S. mold makers make compression tools, Slyman said. Weber Manufacturing Ltd. in Midland, Ontario; Snider Mold Co. Inc. of Mequon, Wis.; and Schulz are three of the larger SMC tooling companies, he said.
``I think SMC is a growing sector,'' Slyman said. ``But for a toolmaker, you have to get in the door with one of only a few molders to be successful. Industry consolidation has made it more difficult.''
In the past several years, the number of compression molders has dwindled. Several companies, including Eagle Picher Industries Inc. and GenCorp Inc., have sold their SMC parts businesses to Cambridge.
SMC parts are used for exterior body panels, such as hoods and fenders, on a number of heavy trucks and a variety of exterior and functional parts on many passenger cars, including General Motors Corp.'s Chevrolet Corvette and the Ford Motor Co. Mustang.
Modern Tool might have been as much a victim of undercapacity as it was a casualty of slowing business activity, said James Meinert, director of national and international marketing with Snider Mold.
Broadening its work to industries outside the up-and-down auto market also might have helped, Meinert said. SMC is used frequently in such markets as electronics, marine and home products.
``Modern faced overall industry capacity issues,'' Meinert said. ``It seems like about half the [compression] molds are coming in from Canada, where there are some strong, larger shops. It's a fairly flat market for SMC in the auto industry, except in the large-truck area.''
Modern had gone through several ownership permutations since opening in 1965. The company was owned by Libbey Owens Ford, a Toledo-based window-systems supplier that used its tooling for in-house work. The auto supplier subsequently was bought by London-based Pilkington plc and became Pilkington Libbey-Owens-Ford.
In 1995, a management group that included Hamstreet and former Modern President William Weaver bought the tooling company. Weaver since has left Modern.
At its height in the late 1980s, the company had more than 100 employees. But work began to wane after that, Hamstreet said. Libbey Owens Ford had used the shop to make tools for reinforced reaction injection molding, a process used to make polyurethane-based window encapsulation systems.
However, some of that RRIM work was lost when automakers converted some products to less-expensive extruded PVC sheet and injection molded thermoplastic parts.
The mold shop employed about 45 when downsizing began in December, Hamstreet said. The company recorded sales of about $14 million last year, he added.