Injection molder Rosti Technical Plastics will open its third plant in China, and is studying expansion elsewhere in Asia, possibly India.
Mike Sullivan, vice president of international products and research and development, revealed the plans at Interplas 2005, held Oct. 3-7 in Birmingham.
RTP already has 13 production sites on three continents and 350 injection presses. The firm also is considering new capacity in Eastern Europe, with a possible third production unit in Poland.
RTP was reborn in the wake of overcapacity in the global telecommunications market. The company's telecom business has been reduced from 40 percent of its total sales a few years ago to 7 percent today. Now, its key markets include domestic appliances, consumer electronics, business machines, automotive and medical. The company is a division of Rosti A/S in Farum, Denmark.
Radical reorganization in recent years has included the closure or sale of five RTP plants in the United Kingdom, leaving it a single unit today in Larkhall, Scotland. U.S. sites are Dallas; Searcy, Ark.; and Minden, La. Other RTP plants are in Tilburg, Netherlands; Bialystok, Poland; Skive, Denmark; Guadalajara, Mexico; and Suzhou, China.
It was three years ago that Rosti, keen to adapt to changing global market conditions, adopted a transformation strategy.
``What we had to do was quite drastic. Our [first] plant in China was purposely built for telecoms, exactly at the wrong time because as it was being built, the telecoms crisis happened. The whole China project had to change,'' said Karl Stillman, RTP business development manager.
Rosti's two existing China plants cover 81,000 square feet, are equipped with 31 presses of 35-800 tons, mainly Demags, a painting line, and manual and semi-automated assembly. The molder still has to confirm the location for its proposed third production unit. Today, RTPs biggest market in China is business machines, Stillman said.
In Poland, where RTP has found a well-educated and skilled labor force, it has 74 injection molding machines running around the clock. A second plant at the site opened in January and is operating at full volume, with a major manufacturing contract for Philips NV's Suncare tanning appliances. A new, 1,400-ton Demag injection press was installed there in July.
Despite cutbacks last year at its remaining United Kingdom plant, RTP invested in new Demag presses for that site, upping the count to 36, and in automation. It also upgraded painting capabilities there.
The medical sector is becoming more important to RTP, which last year launched a specialty business unit in Tilburg, Netherlands, to handle the market. The firm expects medical sales to double, accounting for 20 percent of its total sales, by 2007, said Chief Executive Officer Tez Kurwie.
``Five years ago our business was in the third tier, although we made major modules in the telecoms and for other appliances; nevertheless, we were in the third tier. We have moved out of that substantially, into added-value second-tier and first-tier work,'' Sullivan said, noting that the new role gives Rosti greater security.
``It's a different way of doing business because now we have longer-term supply contracts and so we have security in our investments; whereas, in the third tier, you are pretty much holding the tool,'' he said. ``Your only security is that you are manufacturing while you have the tool. When the tool moves, the business relationship is over.''
While plastics molding is still its core business, RTP has broadened its capabilities to accommodate customers.
``Now we do [research and development] and design, supply-chain management, and we have some contracts with complete product manufacturing. We are distributing, and we have one contract with after-sales already,'' Sullivan said.
Together, RTP and Rosti Containers, a blow molded packaging division in Europe, have annual sales of nearly 200 million euros (US$239 million).