Rubber specialist Cooper-Standard Automotive Inc. is embracing plastics, boosting its capabilities to make sealing systems and hoses from a mixture of materials.
The company has carefully planned the move, which recognizes the rising use of thermoplastics where rubber once reigned supreme, said Chief Executive Officer James McElya during an Aug. 3 interview at the auto industry's Management Briefing Seminars in Traverse City.
``We will not set up an application that is either all plastic or all rubber anymore,'' he said. ``We will have the ability to produce the product in the right material, whatever it is.''
The switch has been on the way since 2000 when Cooper-Standard - then owned by Cooper Tire & Rubber Co. - commissioned studies looking at the future of auto body sealing, he said.
Each study gave the same results, predicting that by 2010, plastics would have 40-60 percent of the market, typically using thermoplastic vulcanizate and thermoplastic elastomers.
Since then, the Novi, Mich., company has invested $40 million in engineering, design, development work and capital equipment so it could process plastics as well as rubber, McElya said.
``In 2000, we clearly saw ourselves as a rubber company,'' he said. ``The most significant change that we've made is that we've been able to change the culture to the fact that we are a sealing company, and we will seal with whatever the raw material is.''
In June, Cooper-Standard launched production of an all-plastic body sealing system for General Motors Corp.'s Impala sedan.
And the company has moved beyond simple one-for-one material replacement, McElya said. It manufactures a thermoplastic proprietary module combining a window seal with an extruded plastic exterior applique that matches the vehicle's body color. GM has signed on Cooper-Standard to use the system on its next-generation Cadillac Escalade, he said.
The firm has started moving plastics capabilities into its fluid-handling systems, responding to an increased interest in the material for fuel lines and other tubes and hoses, McElya said.
A change in ownership last year is helping the firm follow its new outlook. Private equity backers Cypress Group and Goldman Sachs Capital Partners acquired the sealing supplier for $1.16 billion in December.
The new owners are providing capital for new equipment, funding possible expansions into new markets and considering acquisitions that will bring Cooper-Standard access to new technology and customers.
The company expects to spend $75 million in capital expenditures in 2005 alone.
``We're pretty happy we were acquired by a company that wants to grow the business,'' McElya said.
The changes are not quite over, though. Last year's sale to Cypress and Goldman Sachs allows the firm to retain the Cooper-Standard name for two years. With the clock ticking, the now-independent business is considering its options.
``I'm inclined to have a name that is somewhat reflective of what we do,'' McElya said. ``We're an engineering company. We're a manufacturing company. We're a problem-solving, solution-providing type of company.''
