Cincinnati Fiberglass Inc., a maker of truck roofs and other open-molded composite truck parts, said it soon will be forced to sell its business or close its doors due to pricing pressure from its main customer.
The Batavia, Ohio-based company told its primary customer, Paccar Inc. of Bellevue, Wash., that it will cease doing business with Paccar within the next several months, Cincinnati Fiberglass Executive Vice President Gregory Meurer said March 17.
Cincinnati Fiberglass is shopping for a buyer and already has found interest from several undisclosed parties, Meurer said. The company would like to find a buyer to continue operations at its 104,000-square-foot plant, he said.
The nearly 30-year-old company was forced to take drastic action, as prices for fiberglass raw materials have spiked, and Paccar has asked for price reductions at the same time, Meurer said.
``It's both a matter of resin and a difficult customer,'' he said.
About 95 percent of Cincinnati Fiberglass' sales come from Paccar, he said. The processor uses about 200,000 pounds of resin a month, primarily in resin transfer molding and spray-up work. About 20 percent of its costs come from materials.
The company employs 247, all in Batavia, and recorded sales of $16 million last year.
Cincinnati Fiberglass owner John Glass brought the situation to Paccar's attention two weeks ago, Meurer said. The truck maker had delayed paying the higher price sought by Cincinnati Fiberglass for its truck parts and then asked for a lower base price, Meurer said.
Paccar told Cincinnati Fiberglass that the two could ``reason together,'' but Cincinnati Fiberglass decided the situation was too dire, he said.
Paccar officials could not be reached for comment. The publicly held company posted record sales and profit in 2004, ending the year with $11.4 billion in sales. Paccar makes Kenworth, Peterbilt and DAF trucks.