Injection molder Ace Mold Co. Ltd. is spending more than US$8 million to build a large molding and plastics decorating plant in Zhuhai, China, and giving it room for future expansion.
The Hong Kong-based company has been growing 20 percent a year in sales, on the strength of China's booming exports. The Zhuhai expansion is part of Ace's strategy to move into more sophisticated work and handle operations like electroplating, decorating and assembly, the company said.
The factory, with 40-50 presses and 400-500 employees, will start up in the third quarter of 2007, and will significantly boost Ace's capacity. The company currently has about 2,000 employees, including 650 mold makers and 130 injection molding machines in Shenzhen and Shanghai, China.
``We see if we are just a straight molder, it is very difficult to survive,'' Jack Yeung said in a Nov. 8 interview at the China Dongguan International Plastics, Packaging, Rubber, Die-casting and Foundry Exhibition. The show was held Nov. 8-11 in Dongguan.
The firm is using about one-quarter of the 900,000 square feet in property it bought in Zhuhai, which is across the Pearl River from Shenzhen. It anticipates adding a second factory there.
As well, Yeung said the firm recently bought land to expand Shanghai operations, which it started up in 2003, and last year it also moved into larger quarters in Shenzhen.
Ace's growth comes from positioning itself entirely in China's export supply chain for products such as consumer electronics, packaging, automotive and cosmetics, and avoiding China's much more competitive local manufacturing market.
That local market has significant overcapacity, but Yeung said it is just the opposite in the higher-end export manufacturing market, where there is sometimes a shortage of qualified firms.
``The growth in China is still tremendous,'' he said.
Privately held Ace does not disclose sales. It has three U.S. offices, in Massachusetts, New Jersey and California, and one in the United Kingdom. The company is looking at partnerships with foreign firms, Yeung said.
Ace, which was started as a mold-making company in Hong Kong in 1988, chose Zhuhai because there are tax advantages to manufacturing there and because the company liked the city, which is something of a holiday town.
Part of the firm's move into more sophisticated work includes focusing on multishot molding that mixes materials like silicones and plastics, experimenting with spin two-shot technology developed by Krauss-Maffei, adopting scientific molding and using more automated production lines, he said.
It is adding electroplating capabilities, which it previously had subcontracted, for products like shower heads, automotive trim and cosmetic containers. The firm recently added a Ferromatik Milacron press for thin-wall, high-cavity molds, and a grinding wheel that can be adjusted in 0.000040-inch increments for fine finishes.
Ace sees itself in five years as being where the best European molders and mold makers are today, even as those companies become better as well, Yeung said.
``We want to be advanced in technology,'' he said. ``We want people to see us as `Made in China,' with advanced technology and precision.''
