Tight environmental regulations are breaking loose sales of six-layer Kautex coextrusion machines in a market that was content with single-layer blow molding - fuel tanks for products such as lawn mowers, weed whackers, snowmobiles and all-terrain vehicles.
Rules from the federal Environmental Protection Agency and the influential California Air Resources Board are cutting hydrocarbon emissions from small fuel tanks. Under EPA guidelines, new fuel tanks must be in production by 2007. Many of the tanks will appear on 2008 models.
Kautex Machines Inc., already a leading supplier of multilayer blow molding machines for automotive fuel tanks, is getting lots of interest - and winning sales - from custom blow molders and small-tank makers, said Wolfgang Meyer, president of the company in North Branch, N.J.
The sophisticated, six-layer blow molding machines are assembled in Bonn, Germany, by Kautex Maschinenbau GmbH.
Makers of automotive gas tanks are huge companies, able to pull the trigger on a major capital expense like the Kautex machines. For the new type of six-layer machine customer, typically a small company, it's a huge decision to buy one of the giant, expensive machines.
Officials of two new Kautex six-layer owners, AcroTech Midwest Inc. and Agri-Industrial Plastics Co., said the blow molding machines are their largest-ever single capital investment.
Fuel-tank specialist AcroTech has purchased its first six-layer machine. All of its existing blow molding lines made single-layer tanks.
``About 75-80 percent of our business is fuel tanks, and that drove us in that direction,'' said Don Miller, AcroTech's director of sales and marketing. The company makes tanks for personal watercraft, boats, golf carts, snowmobiles and similar vehicles.
``We have to invest in this to maintain our customer base,'' Miller said.
He said AcroTech is getting into fuel tanks for riding lawn mowers, using the Kautex machine as leverage.
AcroTech bought a dual-platen, double-station machine with robotic transfer. The platens are stationary. As the parison comes out of the extrusion head, a robot moves the parison to each platen for molding.
The massive continuous extrusion machine can pump out 4,840 pounds of plastic an hour.
Ken Carter, vice president of technical services, traveled to Bonn in early September for the final runoff. The machine is scheduled to be at AcroTech's plant in Watertown, S.D., this month. Carter said the company hopes to run the first parts in December.
``The reason we went with a dual-platen was to run multiple jobs, so that I can handle the lower volumes that are nonautomotive,'' Carter said. Technicians can shut off one mold for mold changes or other maintenance, while the other mold keeps running.
Carter said AcroTech also bought an automated finishing station, with four robots, including robotic cutting, trimming and a Bielomatic welding system.
For AcroTech, the new machine was a key reason officials decided last year to move the company from Riverton, Minn., to South Dakota, where it has more than 100,000 square feet of manufacturing space and rail access.
Miller said AcroTech invested $10 million for the building and equipment. It marked the largest investment ever for AcroTech, which generated $25 million in sales last year.
AcroTech's existing fuel-tank customers are ready to buy the new tanks. ``They're not being caught off guard'' by the environmental regulations, Miller said. As word spreads that the company has the machine, calls are coming in from potential new customers, he added.
Miller said AcroTech plans to order a second six-layer Kautex within a year. But it's a big decision. ``We're trying to expand our markets, too, but we also have to make sure we can take care of our existing customers,'' he said.
Lori Schaefer remembers the date in late August when seven semi-trucks' worth of components arrived in Fairfield, Iowa, bearing components for Agri-Industrial's first six-layer blow molding machine. A crew assembled the machine, and the company hoped to be running test parts by November or December, she said.
``It's just a huge machine. It's really hard to even describe it without seeing it,'' said Schaefer, director of business development. She is the daughter of Agri-Industrial President Dick Smith.
Buying the six-layer Kautex was a big decision at Agri-Industrial, a custom industrial blow molder with 20 machines. The family-owned company does not release sales figures.
Schaefer said getting into six-layer blow molding has helped create new business in fuel tanks. ``The strategy has worked well because it's gotten us in early, into conversations with these customers that have to meet these [emissions] standards,'' she said.
Agri-Industrial followed up the six-layer machine buy by ordering two more Kautex machines - these units are single-layer Kautex KT-75S machines. Each machine has a 20-layer accumulator head, and 78-ton single clamps.
Meanwhile, Kautex is promoting the return of U.S. manufacturing of its monolayer accumulator-head machines - for the first time since the company closed its in-house assembly in New Jersey in 2003. Epco Machinery LLC is assembling the machines at its factory in Fremont, Ohio, using heads supplied by Kautex in Germany. Meyer said Kautex is sourcing other major components from the United States, including the extruder and gearbox, hydraulics, barrel and screw.
Epco does final assembly. ``Basically, we are their factory,'' Epco President Steve Schroeder said.
The Fremont plant, which also remanufactures plastics machinery, has high ceilings and overhead cranes.
Schroeder said the partnership began last year.
Meyer said making Kautex single-layer industrial blow molding machines in the United States, instead of Germany, makes sense to reduce costs and speed delivery. The two new KT machines are scheduled for delivery to Agri-Industrial in December, he said.
Agri-Industrial's Schaefer said the six-layer machine has generated general industrial work. ``There's a lot of people who want to talk to us about the coex. That's opened the door for people,'' she said.
Meyer said U.S. assembly should help Kautex, as U.S. business for monolayer accumulator-head machines begins to pick up gradually from the low levels of recent years.