DTM Products Inc. has laid off 28 workers and reduced injection molding at its Niwot, Colo., plant, so it can, instead, boost the facility's design, engineering and mold-building capabilities.
DTM is shifting more high-volume injection molding work to its sister plants in Mexico, China and Hungary. The company is a subsidiary of Flextronics International Ltd., a giant electronics contract manufacturer.
``About a year ago, we decided to focus our talents in Colorado,'' DTM President Bob Grubb said in a telephone interview.
Now, DTM in Colorado and MeccaDesign, a Flextronics design center in Monza, Italy, are working together to help customers on product design and upfront engineering analysis, he said.
The two product-introduction centers for plastics processing, mechanical design and assembly are feeding three principal molding sites. The goal is to expedite output to meet customer needs.
In a recent quick-turnaround job, DTM delivered 3,000 parts to Japan less than three weeks after the customer approved the design. DTM worked with its customer, Hewlett-Packard Co., to make the finished part design, build the tool, do capability tests and deliver the product for preproduction assembly.
Design activity in Niwot has picked up in the last year with investments in engineering talent, machine tools and Unigraphics software. The Unigraphics investment complemented the plant's existing Pro/Engineer and Moldflow software.
The operation, historically, was a high-volume producer of medical, business-equipment and telecommunications parts. But with the switch in emphasis to product design, the plant has reduced its molding machine inventory about 20 percent. Some equipment was sent to a DTM site on the 32-acre Flextronics campus in Guadalajara, Mexico.
DTM's Colorado molding shop cut 28 positions during March and April, following the end of a production run that required a weekend shift.
``The Colorado molding market is extremely soft,'' Grubb said. ``A number of molders have gone out of business in the last 18 months.''
Remaining molding projects at DTM Colorado are typically shorter runs than those fulfilled elsewhere. ``Mexico makes good sense for parts consumed in Mexico or high-labor content subassemblies,'' Grubb said.
Flextronics also injection molds in China through its control of Fico Investment Holding Ltd. and in Hungary through its majority ownership of Neutronics Ecoplast KFT.
By late spring, Flextronics' four plastics-related units will have a new organizational structure ``under the same concept as Flextronics does for its electronics centers,'' Grubb said. DTM, MeccaDesign, Fico and Neutronics Ecoplast will get a unified worldwide identity.
Flextronics units operate 105 presses in Doumen and Shenzhen, China; about 60 in Sarvar, Hungary, with another molding facility under construction in Zalaegerszeg, Hungary; about 23 in Guadalajara with space for up to 80; and 24 in Colorado, down from 30.
Tonnages range from 50-1,000 with the larger size presses in Hungary and China.
DTM makes about 10-15 percent of its North American molds in-house, Grubb said. That portion may increase, and China and Guadalajara tool rooms will gravitate to mold making. But Flextronics fully intends to continue sourcing most molds from outside suppliers.
Plastics News' listing of North America's injection molders estimated DTM had sales of $35 million for the fiscal year ending in March 1998. Flextronics acquired DTM in December 1997 for stock valued then at more than $10 million.
Parent firm Flextronics reported profit of $40 million on sales of $1.3 billion for the nine months ending Dec. 31. Flextronics is incorporated in Singapore, has principal offices in San Jose, Calif., and trades on the Nasdaq National Market.