YORK, PA. (June 20, 1:20 p.m. EDT) — Graham Machinery Group (Booth E9901) will work with two Asian equipment companies to make its extrusion blow molding equipment in China and has launched its first production of reciprocating-screw machines.
The dual partnership moves in Asia give Graham a stepped-up presence in China and other parts of the Pacific Rim, said Graham Chairman and Chief Executive Officer Steven Wood in a June 17 interview at the company's York headquarters. Both companies that Graham is working with are major equipment providers in Asia.
The expansion in Asia is Graham's response to customer requests for blow molding equipment in that region, he said. Currently, about half of Graham's machines are sold outside of the United States, Wood said.
“We're not rushing to China as a panic response to Asian competition,” he said. “We look at Asia as an opportunity to broaden the distribution of our products. We've had some success with that already and are continuing to increase that base.”
Graham has started a joint venture with Singapore-based Chee Eng Hang Pte Ltd., called CEH Group, and its RIM Polymers Industries Pte. Ltd. unit. The RIM Polymers group will make blow molding machines for Graham at its existing plant in Shenyang, China, located north of Beijing.
The products will include Graham's line of indexing rotary and continuous shuttle machines and be sold for packaging applications in Asia, said Joe Spohr, Graham senior vice president for global business development.
Graham, known informally as GMG, also will manufacture its line of industrial blow molding equipment in Asia through a joint cooperation agreement signed with Fu Chun Shin Machinery Manufacture Co. Ltd of Tainan, Taiwan. FCS will manufacture the GMG line of accumulator-head machines at its plants in Tainan and Shenzhen, China, Spohr said.
Both companies will distribute the GMG machines throughout Asia, with CEH handling Graham's packaging equipment and FCS its industrial products.
In return, Graham will distribute FCS injection molding machines in North America and will work with the firm to build its base on this continent, Spohr said. FCS is one of Taiwan's largest makers of injection presses.
Graham also has acquired the technological rights to a line of reciprocating-screw machinery from an unspecified source. Those machines, primarily used for monolayer milk containers and water bottles, will be built at Graham's York facility under several multiple-machine supply agreements.
Graham has started building its first reciprocating-screw machine for Keystone Container LLC, a maker of milk bottles based in Reading, Pa. GMG had serviced and remanufactured machines before, but had never made its own reciprocating-screw units, Wood said.
The equipment rounds out GMG's portfolio of extrusion blow molding equipment, Wood said. The reciprocating-screw machines normally are used for less-complex or lower-volume applications, he said.
Five-year plan
The bold moves are another step in Graham's five-year strategic growth plan since separating in 1998 from the company's former container division, now called Graham Packaging Co. Inc. Since then, GMG has grown independently, serving a wider array of customers and becoming a technology leader, according to Wood.
Graham now considers itself the largest producer of extrusion blow molding equipment in North America, where its machines are used for a variety of polyethylene containers, and among the top three producers for that process in the world. The machines are primarily used for PE containers and polycarbonate water bottles.
“We're not a company that is crying the blues,” said Wood, who added that Graham has more than doubled sales in the past three years.
“Our plan has been to accumulate technology and use sound investing principles to live up to our growth potential. We knew we had to get in front of more customers.”
The company has already expanded its product line in the past five years, Known before as a maker of rotary wheel machines for motor oil and beverage products, the company has broadened its extrusion blow molding line to include shuttle machines, rotary shuttles and accumulator-head machines.
Two of the new agreements get those products to the Asian market, where the bottle market is growing significantly, Wood said. But the work will not be performed at the expense of North American labor, he said.
“Our plan is not to export jobs to Asia but to sell more products and improve our market position there,” he said.
In Shenyang, Graham equipment will be made at CEH's 100,000-square-foot site. Although Graham holds a majority share of the joint venture, the machines primarily will be made by CEH workers at the facility.
The company plans to launch its first shuttle machine in time for the Chinaplas 2003 show in December in Beijing, he said. Products sold to the Asian market will include food and beverage bottles, motor oil and consumer goods, Spohr said.
CEH is a large maker of rubber injection molding for shoe production and polyurethane foaming equipment. The Singapore company plans to distribute the equipment throughout the Pan-Pacific region, including South Korea, Thailand, Vietnam and Malaysia, according to a CEH/RIM Polymers Web site.
Also in Asia, FCS will sell Graham's line of accumulator-head machines, used for such items as large trash containers and automotive ducts.
Graham will cross-sell FCS injection equipment in North America, the first time the company has entered the injection molding area. FCS already has an installed base of about 35,0000 injection machines and more than 1.5 million square feet of manufacturing facilities in Taiwan and China, Spohr said. The machines, both all-electric and hydraulic, have clamping forces of 200-3,000 tons.
Graham will be displaying some of its machinery and technology at NPE 2003. The company will introduce a dual-station, shuttle blow molding machine. Its new XBM Navigator controller, which allows remote operation, also will be showcased on several machines at the week-long event.
Graham has come a great distance since the days when it was a captive equipment processor for Graham's line of PE containers, just five years ago.
“The challenge [when Graham Machinery was split off] was really to create a new business model,” Wood said. “We resolved to increase our company's presence, and we've done that in many ways.”
