European automotive and medical/pharmaceutical molder Wilden AG, having failed to crack the U.S. market significantly after a decade of trying, is focusing on the promising, less-developed markets of China, Eastern Europe and the Middle East.
The Regensburg, Germany-based firm employs nearly 1,200, runs 270 injection presses and operates 13 plants and branch offices in eight countries.
This summer, it formed a Hong Kong joint venture with Wise Optotech Ltd., a unit of China's Wise Group. The venture, Wilden Wise (Asia) Ltd., will invest 3 million to 5 million euros ($3.8 million to $6.4 million) to buy 30 presses to start production in the latter half of 2005, said Wilden AG Chief Executive Officer Hans Wilden. The German firm owns 40 percent of the venture.
Currently, Wise Group operates 50 presses, from 50-200 tons, and has nearly 323,000 square feet of production space in Dongguan City. It employs 930 and also performs assembly and produces electronic parts.
Wise recently put into operation a 3,230-square-foot, Class 100,000 clean room specifically for Wilden. Clean-room technology is not common in China.
Separately, privately held Wilden AG - considered one of the 50 largest injection molders in Europe - recently formed a one-press molding venture in Dubai, United Arab Emirates.
``Having a strategic presence there is more important than the size,'' Wilden said in an Oct. 20 news conference at K 2004 in Dusseldorf. The venture initially plans to export products back to Germany.
To remain competitive, according to its CEO, Wilden AG must become a global, full-service provider, offering everything from product development to manufacturing, assembly and logistics. That increasingly means following key customers to far-flung corners of the globe. He said the China venture will supply local plants of existing customers Siemens AG, Bosch AG and Volkswagen AG, among others.
But Hans Wilden also remains committed to North America, where Wilden Plastics (USA) LP continues to operate in Peachtree City, Ga., near Atlanta. He said in an interview after the news conference that he harbors a soft spot for the United States, as his father grew up in Cleveland - and he remains keen on gaining a better U.S. foothold. But he acknowledged, ``We were not successful in competing in the American market.''
The going has been tough. Shortly after it launched the Peachtree City plant, the U.S. company announced ambitious growth plans, but had to scale them back because of management restructuring and loss of business. Then, in early 2000, Klaus Kraemer, then president of Wilden Plastics (USA), declared publicly that his firm had generated 1999 sales of $15 million, and it planned within months to add a dozen injection presses to its current stable of 35. He said the U.S. company was close to finalizing joint ventures with molders in Florida and Illinois. The company predicted its 2000 sales would grow by about 40 percent, and Wilden USA sales would hit $50 million by the end of 2004.
None of that materialized. Nearly five years later, Kraemer is long gone, and Wilden USA employs 60 and runs 20 presses in a 32,000-square-foot plant. Hans Wilden said the U.S. operation's sales are about $10 million a year, and acknowledges they never were close to $15 million. The Georgia plant's output is split between automotive and medical/pharmaceutical products.
Wilden said he underestimated the challenges a German firm would have communicating with and winning the confidence of U.S. customers. He now says it was a mistake to buy out his one-time partners - Vermont-based George and Richard Curtis - when he did, since it left the subsidiary without an American face.
``It takes longer than expected'' to succeed in the tough U.S. market, said Wilden, who is willing ``to grow like the market allows.''
Today, he's more inclined to follow existing customers to new markets than to forge his own path. The firm's operations also include sites in Sweden, Italy, Switzerland, Poland and the Czech Republic. A year ago it opened its third Czech plant, and its first there with clean rooms, to make polycarbonate covers for automotive lighting supplier Hella AG.
Wilden AG's overall sales tumbled sharply when customers such as Siemens shifted production to China. In 2003, sales were 147 million euros ($166 million), down from 189.9 million euros ($215 million) in 2001.
Hans Wilden hopes expansion into fast-growing markets like China, combined with a concerted effort to partner with customers in the early stages of product development, will help the company's fortunes rebound. Such efforts include close work with British and U.S. partners on a new, high-speed blood-test kit. A British biotechnology firm developed and produces the test strip; Worcester, Mass.-based Verax Biomedical Inc. owns the product idea and markets and distributes the kit; and Wilden molds the housing and handles complete assembly.
In another instance, Wilden worked hand-in-hand with pharmaceuticals giant GlaxoSmithKline to develop and produce a toothpaste dispenser. The molder makes the product at its plant in Pfreimd, Germany. Wilden did extensive design work, made a number of high-cavitation production molds and created an assembly line. It molds and assembles the dispenser and oversees delivery to the customer's site in Maidenhead, England.