AcroTech Midwest Inc.'s move to South Dakota means the firm will move into new processing technology for its recreational vehicle fuel tanks.
The firm, currently based in Riverton, Minn., announced last week its intent to close the Riverton site and move to Watertown, S.D.
AcroTech's $12 million investment means the firm will advance into coextrusion blow molding technology in order to meet new guidelines for fuel tank emissions under the Environmental Protection Agency's new guidelines.
``[There were] no solutions that meet the EPA regulations in a monolayer, without serious cost impacts to our customers,'' AcroTech President Stephen Abernathy said in a Sept. 13 telephone interview. ``That's why the coextrusion was the direction to go. That was through a lot of work with our customers.''
Under the EPA guidelines, new fuel tanks must be in production by 2007. Abernathy said the company's investment includes one twin-platen SIG Kautex Inc. blow molding machine, model 2-120 D. It will produce a six-layer tank, which will include the barrier layer.
``It's proven technology. It's going to provide us and our customers what is considered a proven fuel tank emissions standard,'' he said.
Although unionized employees in Riverton plan to begin discussions in an attempt to keep the plant open, Abernathy has said the decision to close the Riverton plant is a final decision. AcroTech outgrew the Riverton site, and the Watertown site will be built larger to accommodate AcroTech's manufacturing processes. AcroTech has been in the Riverton location since about 1995.
``The new building is extraordinarily tall. It's a larger facility, more attuned to our manufacturing processes,'' Abernathy said of the 100,000-square foot site that is under construction in Watertown. It also will have rail access.
``Basically, the facility is a linear-flow processing plant. We could do that in this new facility,'' Abernathy said. ``To stay in this market, we had to buy new equipment. The plant was designed for expansion to the point where the current floor footprint could become manufacturing. So it allows us the growth potential that our market looks like it needs.''
That first machine is scheduled for delivery in June. Officials will add a second machine for coextrusion, but that has not been specified yet.
``Our markets will determine what size that needs to be,'' Abernathy said.
The Riverton site has 24 blow molding machines, most of which will be moved to the Watertown site.
Fuel tanks represent about 65 percent of AcroTech's sales.