Captive Plastics Inc. of Piscataway, N.J., will close its blow molding plant in Edinburgh, Ind., by the end of May, and will close one of two plants in Richmond, Va., by the end of August.
The company cited high freight costs as a reason for the consolidation.
``Edinburgh continues to be profitable,'' said Michael Schreiweis, plant manager for that site, in a Feb. 12 telephone interview. ``Freight is the single biggest issue confronting us.''
The Edinburgh closing affects 39 workers at the 40,000-square-foot plant, which is a leased location Captive has operated since 2001, when it acquired Star Container Co. from Tech Group Inc.
The former Star plants in Edinburgh and Phoenix mostly made injection stretch blow molded containers from glycol-modified PET for food, beverage and household applications.
Captive will move Edinburgh's six stretch blow molding machines to its other plants. One will relocate to Phoenix, two to Baltimore and three to Bettendorf, Iowa.
``We've grown quite a bit organically and through acquisition,'' President Peter Martin said. ``As we've acquired other facilities around the Midwest, it's given us the opportunity to look at our total cost structure. We were constantly faced with the high cost of freight coming out of that facility. With a combination of physical size of the facility and freight logistics, we have more competitive alternatives.''
In Richmond, Captive had two plants within 10 miles of each other that the company acquired with Spentech Plastic Containers Inc. in 2005, Martin said. The firm will close its 48,000-square-foot Richmond facility and move blow molding production and employees to its 137,000-square-foot plant in that city. Captive is taking on an additional 37,000 square feet at that site under a lease agreement. The larger site currently employs 111.
Captive offers more than 550 rigid plastic containers and that lineup is growing, as the company has consolidated all stock containers from the acquisitions of Spentech Plastic Containers Inc. of Richmond in 2005; Grafco PET Packaging Technologies of Hanover, Md., in 2006; and Premier Plastics Inc. of Tacoma, Wash., also in 2006.
In Plastics News' 2006 ranking, the firm reported $200 million in North American blow molding sales.