The U.S. plastics industry needs one major trade association —one strong voice that speaks for processors, suppliers and related firms.
But the American Plastics Council's newest proposal for a merger is not the best course to achieving such unity.
In fact, the scheme actually may set back merger talks.
APC has proposed that a union with the Society of the Plastics Industry Inc. give resin companies 50 percent of the control on key decisions — like hiring and firing a chief executive. The logic is that APC's members would contribute most of the cash to the combined group, so they should be able to exercise a controlling interest.
Resin companies probably would supply the majority of money to any combined organization: All of APC's roughly $40 million budget comes from resin manufacturers and a significant part of SPI's roughly $30 million budget comes from resin producers.
No one ever claimed business is a democracy. But this plan threatens to tear the industry apart and subvert SPI efforts to boost badly needed processor membership.
Certainly, as APC leaders have said, this proposal is not chiseled in granite. It's just a first step in what should be a long process that eventually will bring the two sides together.
But what does the plan say about the state of the merger talks?
First, it says APC's negotiators believe they're in the position of strength. Five APC members have abandoned SPI in the past 18 months. Want to stop the bleeding? Here's our plan.
Second, it reveals a split that long has threatened the plastics industry — the division among processors, machinery suppliers and resin suppliers. All are key industry players. Should the United States become more like Europe, which has separate associations to represent each group? We don't think so.
Third, it shows just how important personalities are in this debate. APC's resin-supplier members want control over who will lead the combined organization. Insiders say previous merger talks broke down over the same issue.
SPI President Larry Thomas has played a leading role in the industry's efforts to solve the Houston rail crisis. But apparently that's not enough for some factions within APC.
As we've pointed out before, processors and suppliers don't always have identical interests. In those cases, the industry needs to have a process by which it can have a healthy debate and arrive at a compromise with which everyone can live.
We hope this isn't a signal that merger talks will degenerate into a power struggle in which the group with the biggest wallet, or most members, or biggest egos ends up ruling a combined, but weakened, association — or perhaps scuttling the merger altogether.