CHICAGO (July 14, 3:15 p.m. EDT) — Hong Kong mold maker and molder TK Group Ltd. has more than doubled its manufacturing space in Shenzhen to 820,000 square feet this year, and further expansion is under way in its 2 million-square-foot “Mold City” production base.
While many Western companies find China to be the fastest-growing market, TK said its largest market, the United States, is leading the growth and will take the majority of its sales within two years.
Claiming to be the largest mold maker in China, the firm said it is promoting a “total plastic solution,” which integrates product design and optimization, mold design and manufacturing, injection molding, secondary processing and assembly.
TK Group came into existence in 2002 by restructuring subsidiary plastic plants to TK Mold Ltd. and TK Plastics Ltd.
“We used to concentrate on large-size molds for the home appliance and auto industries, but the fierce competition has cut down margin, and we find precision molds for electronics, medical and auto have better business potential,” said Managing Director Michael Yung.
TK Mold employs 700, including more than 150 engineers who use English to work with customers. About 90 percent of the products are exported, 30 percent to the United States, 30 percent to Europe and 10 percent to Asia. Sales, which have been climbing at 20 percent annually the past few years, reached $18 million in 2005 and are projected to exceed $20 million this year.
Molds for the auto industry represent 40 percent of total sales and are 100 percent exported to the United States and Europe. The second-largest end market, home appliances, represents 27 percent; followed by office appliance, 21 percent; telecommunications, 6 percent; and medical products, 1 percent.
“Our major customers include Valeo, Visteon, Electrolux, ABB, Whirlpool, etc.” Yung said.
TK uses steel and hot-runner systems from Japan, North America and Europe.
The molding division, TK Plastics, is more profitable than tooling, Yung said, and sales volume is twice as high. The company has more than 100 JSW presses, equipped with Fanuc robots.
TK Plastics supplies the electronics and medical industries.
The first phase of the Mold City complex includes six buildings, each with 60,000 square feet of space.
“Chinese mold makers have advantages of scale-economy, but we need to upgrade our management to Western levels. We believe the way to stay ahead of competitors is high-tech and high-value products,” he said.
“The potential of precision molds hasn't been fully released in China,” he said, “We expect the high [end] market to develop in the next 10 years.”
Yung was happy with the show attendance. “Maybe because we have a good location. We booked this booth three years ago.”
Privately held TK Group employs 2,500. The company initially started in Hong Kong in 1983 as a seven-person molding shop.