A fog of uncertainty still surrounds the timing of a full recovery for plastics processing machinery in Europe, although most suppliers are hopeful an upswing in orders may be evident by later next year.
Confident predictions made a year ago that the market would be on the mend by the middle of 2002 long since have been discarded. Despite patchy signs of growth in orders early this year, the overall direction of European business during 2002 still was down, manufacturers say.
The German Plastics and Rubber Machinery Association, VDMA, for example, recently reported that new contracts were down 5 percent in the first eight months of 2002 compared with the same period last year.
Most dramatic was the 13 percent plunge in business with German processors. Exports, in contrast, were down 1 percent, according to the Frankfurt, Germany-based trade group.
Orders have ``visibly increased'' since the beginning of the year, but VDMA reported that ``the hoped-for unambiguous upswing did not happen so far; new orders still continue to fluctuate every month.''
VDMA expects sales will finish the year down 12 percent. But German suppliers are not alone. Times have been particularly tough for Italy's many smaller, often family-owned machinery manufacturers. Even bigger firms like Negri Bossi SpA are having to ride out the storm.
The market is ``still very, very quiet,'' said Francesco Baldinelli, vice president and managing director of injection press producer Negri Bossi of Cologno Monzese, Italy. Recovery ``is not for this year. If we're lucky it will improve next year.''
During the past two years the European market, in terms of machine volume, has fallen about 40 percent, according to Italian and German machinery associations, Baldinelli said in an interview at the Interplas 2002 show in Birmingham.
As if to defy the market blues, Negri Bossi has been growing its business in the United Kingdom, one of Europe's more difficult markets, with sales in 2002 set to rise 5 percent. Business from new customers soared by a third this year, according to Carl Futcher, director and general manager of subsidiary Negri Bossi Ltd. of Warwick, England.
Another major player in the highly competitive British marketplace is Battenfeld Injection Molding Technology, part of SMS Plastics Technology.
``The [United Kingdom] market is still very weak and there are few signs of serious recovery. ... This year will probably be pretty similar to 2001,'' said Robert Sayers, managing director of Battenfeld UK Ltd., based in High Wycombe, England.
``One feature of this market has always been its peaks and troughs. [But] this has been the first time there's been such a sustained trough. A lot of people are asking if there has been a fundamental change in the nature of business in the U.K. and some are concerned this level of activity is going to continue,'' Sayers said.
Even so, certain end markets, including medical and automotive, are performing strongly in Britain. And, while the market for machines with midrange clamping forces of 200-500 tons is depressed, sales for smaller and bigger machines remain buoyant, he said.
Battenfeld debuted its third-generation, fully electric, 110-ton EM1000/350 press at Interplas.
Another global company feeling the pinch is Husky Injection Molding Systems Ltd. of Bolton, Ontario. The company recently reported a loss of US$12.5 million for the fiscal year ended July 31.
Despite an improved share of key markets such as Germany, Husky has seen a general weakening in the European market.
``We are just hanging behind [North America] in Europe - 11/2 years behind,'' said David Cook, president of the company's European operations, Husky Injection Molding Systems SA of Dudelange, Luxembourg.
Reflecting Husky's overall global position in the past year, Cook said orders were flat in 2001-02, while shipments were down somewhat after new orders in the first part of the fiscal year ``were off.'' In the first six calendar months of 2002 the order position improved, leaving a ``good backlog'' for shipping up to the end of this year, he said at Interplas.
``We are optimistic about the current fiscal year. For Husky in general the order situation in the last six months has improved,'' Cook said. The company has benefited from the still-healthy PET sector and from demand for its Hylectric hybrid electric presses in Europe, he said.
Swiss injection press manufacturer Netstal-Maschinen AG also said things are not going all its way in the depressed European marketplace.
``At the moment, when the market is not going well, we have some problems. But we are in market applications like packaging where they need our machines. We have three product legs, so we have a very good balance,'' said Reto Morger, marketing manager of the NÃ¤fels, Switzerland-based supplier, which is part of the giant Mannesmann Plastics Machinery GmbH.
He reckons the market in 2002 was down almost 25 percent against 2001 even though, unlike last year, customers now ``are speaking about further projects.''
Light on the horizon?
Morger believes the worst of the deep recession is over.
``I think we are through the valley now. It should be better this end-of-year, although it will still be very flat through 2003,'' Morger said.
He forecasts that machinery builders will see a ``brighter light on the horizon'' at the end of next year, but business figures during 2003 will stay pretty much as they are this year.
Morger said the market for Netstal's optical-disc machines for volume production of compact discs and digital versatile discs - where the firm claims market leadership - is down. Netstal recognizes the volatility of that market and has benefited from good orders for packaging for its SynErgy hydraulic presses, as well as for its PET preform machines, he added.
He said his company expects to push the market forward with the launch of its fully electric SynErgy injection press concept within six months. Netstal entered the electric press field last year with its e-Jet hybrid optical-disc press.