TECATE, MEXICO — Formula Plastics Inc. is consolidating its Tecate assembly operations and aiming to boost injection molding output and cut inventory drastically.
Formula in January began constructing a ground-level parking garage and a second floor with 25,000 square feet for assembly and offices. The centralized operations will employ 100-350 beginning in the fall, President Alex Mora said during a plant tour. The project is costing about $500,000.
Formula anticipates improving operations and halving inventories. IQ Management Systems Inc. of Paso Robles, Calif., supplied real-time production monitoring and management controls for about $70,000. Last year, Formula carried inventories of about $1 million, split between raw materials and finished goods.
``I want to cut that to $500,000 by the end of 1999,'' Mora said.
Formula's principal operations occupy 90,000 square feet in several buildings on 121/2 acres. The firm is based, and has other production, in Ontario, Calif. The IQMS controls link all sites.
Mora said the commitments bring Formula's Tecate investments to $2.5 million in facilities and $2 million in equipment, including an optical system for a quality-control laboratory.
Now, assemblers and secondary functions are near injection molding operations in Formula's three existing Tecate units. Only specialized assemblies will remain there after the opening of the fourth plant. Mora said Mexican tax laws favor small plants, and he likes the concept of each plant having its own control.
The operations mold, assemble and test Marlow spa pump housings for an ITT Industries Inc. segment, and sonic-weld and assemble Primordial LLC's Zoob-brand toys under a subcontract from injection molder Jatco Inc. of Union City, Calif.
Formula's management ``has a progressive labor-relations policy, is very sophisticated in its approach to quality circles [and takes an] extraordinarily sensitive approach to the environment and the way they work with people,'' Kristin Shannon, chairman and chief executive officer of Primordial in San Francisco, said in a telephone interview.
``They have a sense of honor as a family and carry it out in workplace practices.''
The maquiladora Polimeros Formula operates 13 modern presses with 170-550 tons of clamping force. The Mexican national company Moldeo de Plasticos has 14 mostly older machines of 100-550 tons. And maquiladora Formula de Plasticos operates 13 presses of 30-400 tons, including three Toshibas acquired in January for a new health-care product.
Together, the molding operations employ 45-65 in addition to the assembly force, and a nearby tool repair and maintenance shop has 14 workers.
In Ontario, Formula employs 35, operates 12 presses and provides support services, including mold acquisition. Formula had companywide sales of $13.2 million last year.